The world of advertising agencies is undergoing a profound transformation that goes beyond creativity and traditional media. We are witnessing a complete redesign of the business model, the main players and customer expectations, driven by the digitalisation of the service sector and the new dynamics of the market.
At Baker Tilly, we have analysed this metamorphosis in detail in our latest industry report, where we identify the main trends that are reshaping the advertising landscape both globally and in Spain. If you work in advertising, media or marketing, this analysis will help you understand where your industry is heading and what opportunities for growth and consolidation are emerging.
The end of campaigns without metrics: results-based models
The advertising industry is definitively abandoning hourly billing and deliverable models in favour of performance-based remuneration schemes. Agencies are increasingly evaluated—and paid—based on the actual impact they generate: leads captured, sales closed, return on advertising spend (ROAS), or conversion rate.
This change responds to a direct demand from chief marketing officers (CMOs), who must justify every euro invested to their boards of directors. The agencies that survive will be those that integrate advanced analytics capabilities, real-time dashboards, and tools that connect creativity with performance.
Strategic involvement: The agency-client relationship is no longer based on creative trust, but rather on evidence of measurable economic impact. This is driving demand for agencies with advanced technological capabilities and expertise in data analytics.
Generative AI: the new engine for creative scaling and personalisation
Generative artificial intelligence models — ChatGPT, Midjourney, Adobe Firefly — have gone from being a futuristic promise to an operational reality in the day-to-day operations of the most competitive agencies. From copywriting to generating visual variations or automated A/B testing, AI is accelerating the creative cycle exponentially.
The result is transformative: More versions, greater customisation and massive iteration capacity without driving up operating costs.. This phenomenon does not imply the disappearance of human creatives, but rather their evolution towards profiles that know how to guide, supervise, and scale the output generated by algorithms.
Agencies that master this integration of emerging technologies will multiply their efficiency, maintaining creative criteria as a key differentiating factor.
First-party data: el nuevo petróleo del marketing digital
With the imminent disappearance of third-party cookies and the tightening of privacy legislation (GDPR, ePrivacy), agencies that fail to adapt are doomed to irrelevance.The new standard requires operating with own data, manage consents transparently, and demonstrate technological capacity to comply with regulations without losing effectiveness.
This involves integrating advanced CRM, data management, martech, and advertising automation solutions. It's not just about legal compliance: we're talking about sustainable competitive advantage..
Key insight: Our analysis reveals that Agencies with expertise in data management, privacy, and compliance are being targeted for strategic acquisitions. by groups seeking to strengthen these critical capabilities.
DTC and e-commerce: performance as the new reigning discipline
The rise of direct-to-consumer (DTC) strategies has revolutionised marketing priorities. More and more brands are abandoning traditional retail channels, using platforms such as Shopify, Amazon or social media such as main sales channel.
This change has triggered a surge in demand for agencies specialising in digital acquisition, performance marketing and conversion optimisation. The focus is no longer on ‘positioning the brand,’ but on acquiring customers in a profitable and scalable way..
Our report documents the emergence of boutique agencies specialising exclusively in growing DTC brands, with a surgical focus on ROI and growth hacking. These sector specialisations are generating premium valuations in M&A transactions.
The great consolidation: from the ‘Big Six’ to the ‘Big Three’
The recent merger between Omnicom and Interpublic marks a historic turning point. The global agency landscape is rapidly consolidating, reducing the number of large multinational groups to three dominant players: Omnicom, Publicis, and WPP.
This movement, which involves $25.6 billion in combined revenue, has profound strategic implications: greater bargaining power with media and technology companies, more robust integrated capabilities, and increasing pressure on medium-sized players to differentiate themselves or join larger platforms.
The trend towards building multi-agency groups through additional purchases continues to accelerate, where technological synergy and access to specialised talent are the main drivers of value.
The imperative of the ‘full funnel’: integrated end-to-end services
It is no longer enough to capture the consumer's attention.. Brands demand that agencies manage the entire customer journey, from the first touchpoint to post-purchase loyalty and customer lifetime value
This demand is driving the growth of Integrated agencies that combine strategy, creativity, media, analysis, and automation under one roof.. According to our analysis, these types of agencies are signing larger and more stable contracts, with ample opportunities for cross-selling.
Fragmented or overly specialised agencies face increasing difficulties in competing, unless they are part of micro-networks or groups covering the entire value chain.
Vertical specialisation: the value of niche expertise
Faced with global giants, many brands—especially in sectors such as healthcare, financial technology, and e-commerce—are betting on boutique agencies with deep expertise in their specific vertical.
Our report documents the rise of «micro-networks»: highly specialised agency groups focusing on specific sectors, specific audiences or unique channels (TikTok, Amazon Ads, mobile programmatic). This specialisation allows more relevant, agile and efficient campaigns.
Strategic conclusion: Generalisation no longer generates value. The future belongs to the niche expertise, creating opportunities for specialised agencies that master specific verticals.
Financing in decline, M&A on the rise
The volume of investment in new agencies has fallen significantly from its peak in 2019, with declines in both the number of rounds and average ticket size. The sector has matured, competition from walled gardens (Google, Meta, Amazon) is fierce and capital is migrating towards more scalable and profitable models.
This dynamic has generated a very active M&A ecosystem, where established groups acquire agencies with distinctive capabilities in order to continue growing. Our analysis includes multiple relevant transactions in Spain and Europe, such as the acquisitions of Jirada by Labelium and Metastartup by MioGroup.
Strategic opportunities for agencies
The challenges are clear: pressure on margins, technological competition, demand for results, customers who internalise services. But so are the opportunities for agencies with clear positioning, technological expertise and strategic vision.
Understanding investment dynamics, consolidation movements, and the preferences of strategic buyers (global groups, funds, consulting firms, private holding companies) is essential for designing the roadmap to growth or an eventual corporate exit.
Advertising Agencies 2025 Market Report
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