Ep 550 Five Opportunities for Agency Evolution with Drew McLellan

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Apr 19, 2026

A seasoned agency leader maps five big opportunities born from AI, consolidation, trust shifts, and hiring changes. He highlights why niche, founder-led shops can thrive as clients rethink in-house teams and discovery methods. Practical plays cover becoming strategic advisors, monetizing AI around outcomes, specializing to get found, capturing unwound budgets, and building sellable businesses.

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INSIGHT

Independent Agencies Inherit Collapsed Institutional Trust

Independent agencies are uniquely positioned because trust in big institutions is collapsing and employers are the most trusted entities.
Drew McLellan cites Edelman and AMI research showing employers are seen as both competent and ethical, creating an advantage for boutiques.

INSIGHT

Consolidation Creates A Lucrative Neglected Middle

Consolidation among holding companies creates a neglected middle market of brands too big for boutiques but too small for networks.
Drew notes CMOs feel bureaucracy and B-teams from networks, opening space for niche independents with 10–20 point higher margins.

INSIGHT

AI Raises Agency Sophistication And AGI Per FTE

AI is rearranging work not eliminating demand for advisors; it commoditizes low-value production while increasing need for strategy, governance, and measurement.
Agencies are boosting AGI per FTE from ~$175k to $225k+ by cutting production time 30–40% with AI and automation.

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Welcome to another energizing solo episode of Build a Better Agency! This week, host Drew McLellan draws on his 25+ years of agency experience to deliver both a rallying cry and a clear-eyed reality check for independent agency owners: the chaos swirling around AI, consolidation, and economic uncertainty isn't the threat it appears to be — it's an invitation. For owners who are willing to evolve, this may be the best decade in history to run an independent agency.

Diving deep into the macro forces reshaping the industry, Drew McLellan unpacks the five trends that every agency owner needs to understand right now — from the collapse of institutional trust landing squarely in your lap, to the cracks forming inside the big holding company networks, to the seismic shift in how clients find and hire agencies. He shares data from AMI's own 2026 Agency Edge Research alongside findings from the Edelman Trust Barometer, painting a compelling picture of why independent, niche, founder-led boutiques are uniquely positioned to thrive while the giants stumble.

Beyond the trends, Drew maps out five concrete opportunities your agency can pursue in the next three to ten years — from repositioning as a strategic advisor rather than a vendor, to monetizing AI the right way, to riding the in-house reversal as brands unwind internal teams they can no longer sustain. You'll hear real data on what's happening to AGI per FTE, why generalist agencies are losing ground, and what the consulting world can teach us about where agency revenue is headed next.

If you're tired of feeling anxious about the future and ready to see the opportunity hiding inside the uncertainty, this episode is essential listening. Whether or not you make it to the Build a Better Agency Summit in May, Drew McLellan's guidance will challenge you to stop waiting for the dust to settle — and start building the agency you actually want to own.

A big thank you to our podcast's presenting sponsor, White Label IQ. They're an amazing resource for agencies who want to outsource their design, dev, or PPC work at wholesale prices. Check out their special offer (10 free hours!) for podcast listeners here.

What You Will Learn in This Episode:

Why this is the best decade to own an independent agency for those willing to evolve their business model
How consolidation among holding companies creates lucrative opportunities in the neglected middle market segment
Five major opportunities that will define successful agencies over the next decade
Why AI adoption gives small shops the sophistication level that previously required holding company resources
How to transform from vendor relationships into strategic advisor partnerships that command premium pricing
The specialization imperative that delivers 10-20% higher margins than generalist agencies
Why your agency is positioned as the most trusted entity in the new economy
How to monetize AI properly by focusing on outcomes rather than tool usage
The workforce evolution requiring fewer FTEs but more strategic value creation