Marketers are walking away from labor-based agency fees. Only 17% of deals now use hours or headcount, down from 54% fifteen years ago. The latest World Federation of Advertisers study shows brands want to pay for what agencies deliver, not how long it takes.
According to WFA/AMS research, 89% of brands believe they receive value for money from their agencies, but only 45% feel they have real transparency into agency costs.
AI is speeding up this change. Laura Forcetti, WFA’s Director of Global Marketing, sourcing and director marketing services, Asia Pacific, says clients now care more about the quality and impact of agency work than hours logged. AI tools let agencies finish many jobs faster, so time is no longer a good measure of value.
Hybrid pay models are catching on. No single system fits every marketing job. Most respondents-global marketing procurement leads from 69 multinational brands-expect performance-based fees to grow, with 58% predicting more use. Value-based and fixed-fee deals are also set to rise. Old commission models keep shrinking.
The WFA's updated research, set for publication in late September 2026, expands its focus beyond remuneration to cover the full commercial cycle-from briefing and scoping to performance, value, remuneration, and payment. This broader approach reflects the increasing complexity of agency relationships and the need for holistic evaluation criteria.
Media service deals show a mixed pattern. Labor-based pay still covers 41% of media planning, 34% of media buying, and 30% of paid social. Most media planning (67%) and media buying (61%) use global contracts, showing the scale and complexity of these jobs.
Media rebates are a separate story. Nearly two-thirds of marketers (63%) do not change agency pay based on volume rebates, up slightly from 60% in 2022. Of those who do, most say the change is small: 25% report rebates offset less than 10% of agency fees, and only 7% see adjustments between 10% and 30%.
These shifts echo what happens when platforms change how they show or credit content, as reported earlier about AI-driven traffic and content visibility. The message is simple: value is being redefined, and old models are losing ground to systems that reward real business results.
Marketers who stick with labor-based pay risk falling behind as AI and performance data change what clients want from agencies. The numbers show brands now reward agencies for results, not effort. Hybrid and output-based models are the new normal for those who want both accountability and creative work that lands. For agencies and marketers, the message is clear: update your pay models to fit the new reality, or risk missing out on the best partnerships.
