19th May 2025
Holding company restructures and redundancies are producing a new wave of indie agencies. It’s only a matter of time until they herald a new era of creativity, says Green Square’s Tony Walford.
At the 2025 Predictions event run by The Drum in February, I was asked what I thought the year would bring for the agency landscape. My response was two things: further consolidation and this will be the year of the indie. Whilst we will see various agencies come together (not just Omnicom/IPG, but think Bauer/Channel Advisor and even Transmission/Earnest), we will also see indie agencies coming into their own, supplemented by a plethora of start-ups. And here’s why.
The Omnicom/IPG combination will undoubtedly result in significant job losses as the combined company looks to increase profitability through cost-cutting. The saying “You can’t cut your way to growth” is very pertinent here…improving profitability through rationalization is all that’s being talked about, with seemingly no focus on growing revenues. WPP is shedding staff following its dismal 2024 results and, only this week, announced further consolidation within GroupM as it pulls its four agencies that operate under that banner into one. This is on top of some high-profile departures, including Ajaz Ahmed, founder of AKQA and veteran of 30 years, who recently broke cover on his new Indie startup, Studio.One.
As a result, there are a lot of senior players within these groups considering their options even before the axe falls, and many will already be planning their next move – either joining an independent or starting one with a bunch of like-minded talent.
Whilst restrictive covenants will prevent many stealing key clients and soliciting fellow staff for a period, client CMOs and brand marketers follow the talent, and it won’t take long for these agencies to thrive – look at Adam&Eve and Uncommon as prior examples of indies that became superstars. Indeed, Richard Brim (CCO) and Martin Beverley (CSO), recently left Adam&Eve/DDB (now seen as a mature agency, given it’s been 13 years since Omnicom bought it), to set up an Indie.
But it won’t just be the senior talent on the move. Smart mid-tier and even juniors who understand the incoming impact of AI and can see a way of harnessing this into a differentiated offer will be interested in doing something novel.
The issue, as always, will be money. It’s not easy for folks with mortgages and the like, or those on fairly low salaries, to simply walk out of an agency and set up another without a client already in place, and taking clients with them will be a big issue unless it’s with the employer’s blessing. This is something we’ve been involved with at Green Square, but it’s rare, and normally only when a business is divesting of a specific offering, in which case the clients go with the departees.
Enter Private Equity. We’ve seen Huge and R/GA both be sold to management by IPG with PE backing and there are rumors that IPG is divesting of the Australasian element of one its other major agencies to avoid falling foul of the anti-trust (monopoly) legislation that could hamper the Omnicom merger. Historically, PE has backed some of the major “independents” we see today – Dept, Brandtech, North Alliance, and Jellyfish to name a few, and there remains a lot of “dry powder” (cash needing deployment) in PE funds. This cash is available for various purposes – to facilitate the purchase of significant agencies from larger groups, augment existing PE-backed platforms through the acquisition of complementary offers, or fund big Indies to accelerate growth whilst allowing owners to take some cash off the table.
But backing startups isn’t something PE is interested in – too risky and too long to wait for a return. For startups, it’s back to the blood, sweat and tears of using personal resources and funding to get off the ground. Perhaps turning to friends and family, or indeed peers who have previously sold a business and want to get involved with backing an exciting new venture. But small is beautiful and as the global economy slows, marketing budgets get cut and CMOs and brand managers spend differently, perhaps spreading their reduced budgets across smaller, more agile agencies that specialize in specific areas of expertise, rather than giving it to one of the networks who could be perceived as navel gazing as they try and solve their own problems.
On that note, I worry about this rash of consolidation across the ‘Big Three’. Whilst Publicis was ahead of the game in moving to its Power of One, WPP’s restructuring and Omnicom/IPG smacks of crashing things together primarily to cut costs, and I wonder what the results will look like from a client point of view. Will there be any differentiation? If it becomes a bit of a blancmange, with their offers all looking the same, then the only obvious differentiator is price, which will mean a race to the bottom for that gang, whilst fresher, more agile and client-focused indie agencies steal a march.
It’s always been the case that indies are fleet of foot and are less restricted by admin, bureaucracy and overhead in delivering their creativity and output. In a world currently characterized by conflict and economic uncertainty, we need to be entertained to take our minds off things. As we see indie agencies flourish, the biggest ray of light will be the uplift in creative output they will undoubtedly bring. Their ability to experiment, push boundaries, and just generally be more innovative without the shackles of “big corporate”, should lead a plethora of new ideas. So, whilst 2025 is already the Year of the Indie, I’m putting my money on 2026 being the year of Outstanding Creativity.