The future seems to be (finally) looking bright for creative agencies in 2025

While the pressure for profitability has forced the split of creative ideation from creative production — dismantling end-to-end creative development services, in 2025, new creative partnerships will emerge that reunite the big idea with the scaled activation.

According to a report by Forrester, the division of creative services will be an opportunity for new companies and collaborations to deliver both creativity and scale. The report added that CMOs conducting creative agency reviews in 2025 should look for providers with built-in ideation/execution partnerships or assemble and manage a roster of independent specialists.

While in the past few years there was a fair bit of in-housing of content and creative roles, the report added that in-house agency growth will decelerate because of AI content production agencies. Insourcing marketing capabilities to gain cost efficiency and reduce agency fees will decline in 2025. There will be a surge in outsourced AI content production agencies that build bespoke platforms for their clients or leverage ad manager platforms configurable to any brand.

CMOs will also ramp up generative AI (genAI) capabilities using external agencies. Forrester says that currently 61% of agencies currently use genAI in marketing execution, but just 17% of US-based B2C executives say their in-house agency uses genAI in their marketing efforts.

As outsourced agencies build AI content production capabilities and bespoke brand AI models, CMOs will notice their ability to deliver low-cost marketing at scale. In 2023, 71% of US B2C executives agreed that genAI will reduce marketing costs by more than 20% in 2024. In 2025, CMOs should explore drawing down their in-house creative service operations while ramping up less costly, lower maintenance, bespoke AI-marketing platforms.

Despite the bright spots, Jay Pattisall, VP, principal analyst at Forrester explained that agency executives have no shortage of issues to muster in 2025. The most critical are AI literacy so that agency staffers are comfortable and capable with AI; a commercial model that puts agency platform products in the hands of their employees; and making their talent part of their product sets by training differentiation and uniqueness into their algorithms.

Creative agency leaders should be singularly focused on scaling the creativity and brand distinctiveness they provide to the same level as media impressions. This means millions of assets on a daily basis. To conceive and produce that type of volume of marketing means that will need to significantly alter how marketing is created and by whom.

"Creatives will need to adopt a creative systems approach in which 100s or 1000s of assets and variables combine to create the right ad, for the right person, delivered at the right time. This can’t be accomplished without AI as the fourth member of the creative team," said Pattisall.

When it comes to the media agency scene, Forrester’s Q4 2023 B2C Marketing CMO Pulse Survey said that 46% of respondents plan to integrate performance and brand media assignments with a single media agency, and 35% plan to integrate creative and media assignments in the next 12 months.

In 2025, CMOs and agency executives will reconcile full-funnel, full-service capabilities with deep expertise in various disciplines and channels. To do this, CMOs will need to combine their team and their provider’s most valuable resources (people and culture) with sophisticated audience technology, creating a human and technology teams to deliver media skills with both precision and persuasion.

In a conversation with MARKETING-INTERACTIVE, Goh Shu Fen, principal of R3 said with holding companies and networks simplifying their operating structures, creative and media agencies will need to find a way to stand and increase investment in specialist capability. This is especially true for full-service agencies.

“As clients seek simplicity and agility in an increasingly complex world we’re navigating, success will be driven by seamless integration of creative, media and data, within client marketing team and business, as well as with external agency partners,” she added.

Goh also added that the focus on performance will “calm down as marketers learn that they cannot drive growth just spending on lower funnel”. This will prompt marketers to reflect and refocus efforts beyond the next tactical campaign, and think strategically about their distinctive brand assets and marketing impact measurement.

Rob Dreblow, global head of marketing services at the WFA said in 2025 a big challenge, facing both agencies and clients, will be to find a balance between automation and human creativity.

“This is not just a challenge for creativity and insight because the solution also needs to maintain transparency and manage risk for both parties. WFA research shows that the latter issues are areas of concern for many of the world’s biggest advertisers” Dreblow said.

Data, data, data

Unsurprisingly, data will continue to dominate and data sourcing and management will no longer be the end products. Instead, agencies will position them as foundational elements to support activation for services like media planning and buying, customer analytics, marketing technology implementation and management, customer experience (CX) implementation, and loyalty and CRM execution.

More CRM agencies will then present as consultancies (standalone or part of a holding company offering) and try to shake off the baggage of data brokers and marketing service providers. CMOs considering data-driven loyalty or CRM activations must recognise that these services are deeply enriched when delivered in the context of commerce, creative, customer insights, and media services.

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