ADWEEK Advantage is part of a series where every month, our top editors interpret what happened in each vertical, and what it means for the future.
Bob Lord, the president of independent agency Horizon Media Holdings, said the quiet part out loud at an industry event earlier this month: The FTE (full-time equivalent) billing model is the “old system.”
“The question for me is whether or not the business models, especially if you’re a public company, can actually be broken without some kind of external force,” he said.
Agencies are at a crossroads. As AI puts a squeeze on traditional revenue models like FTE, they’re pushing the industry to embrace new ones built around measurable results, known as outcome-based remuneration or performance pay.
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