• by Cory Treffiletti , Featured Contributor, Yesterday

Reading the latest trade news, I saw that Adidas announced it was ending an eight-year relationship with WPP. The account moves to Omnicom's PHD following a competitive review that also included several other agencies.

Eight years is a long run in today's landscape.  There’s not many of those long-term relationships left in the industry.  In my opinion, this is not an edge case or some kind of coincidence tied to a single account. I think it's a pattern, and the pattern is only going to accelerate.

Rough math suggests that most strategic agency relationships last around seven years, whereas media agency relationships tend to last just under four years.  Creative and strategy seem more “fixed” than media. 

These numbers get very interesting when you look at the average tenure for CMOs, which is around three to four years these days.  They get even more interesting with the pace of technological innovation increasing to every two to three years. The relationship between those two numbers implies a lot about how churn is increasing, and what holding companies can expect over the next few years.

For decades, the reason you stayed with an agency was the people. You stayed because a specific team did a pitch, understood your brand, history, and internal politics.  They were the best team to execute against all your brand needs faster than anyone new could ramp up. That knowledge took years to build, and losing it was expensive.

Talent was the moat (for a long time).  Talent is no longer the moat because talent moves around, and technology is starting to supplant the importance of the talent.

AI, specifically, is filling in that moat left by talent moving around. Every agency, big or small, incumbent or challenger, now has access to the same stack for media planning, creative production, and optimization.

The playing field on raw talent and capability has leveled out faster than most of us expected. When every shop can stand up a comparable AI-assisted workflow in a matter of months, the old advantage of “our people know you best” erodes quickly. What replaces it isn't people. It's systems.

The agencies winning reviews right now aren't necessarily the ones with the best individual talent. They're the ones that have built the right stack for your needs.  It’s about the data infrastructure, the automation, the measurement layer, and how all of that that can respond to a client's needs faster and more precisely than the incumbent's stack can.

Go one step further, and talent can be wooed from one agency to the next for the right price, and they can steer the stack in a direction that works better for the brand.

That CMO tenure comes into play, too.  The agency isn't really being hired by “the brand,” at least not in the institutional sense that used to be the case. It's being hired by whoever currently holds the CMO seat, built around that person's read of the technology, their vendor relationships, their point of view on where the stack needs to go.

When that CMO leaves, the rationale for the agency leaves with them, whether or not the work was good. The new CMO wants their own read on the AI-era stack, and a review gets called once again.

I don't say any of this as an indictment. A three- to four-year relationship isn't automatically worse than a 10-year one. Plenty of 10-year relationships were coasting on inertia long after the strategic logic had faded away.

What we're watching isn't the death of loyalty between agency and brand. It could be that the market is finally pricing agency relationships the way it prices the executives who chooses them -- honestly, and on a much shorter clock than any of us were built to expect.

Adidas didn't leave WPP because the work got bad. It left because the rate of change eventually outpaces even the best relationships, and eventually, the clock always resets. 

That is what the agency business has to plan for: a future where the pace of innovation is how you sell the client relationship, and you might have to be willing to upend your own stack and your own model every three to four years just to stay in business with that client!