Since 1992, the average price for creative agency deliverables has declined by 70% in today’s dollars, according to my research [1] for Madison Avenue Manslaughter. Nevertheless, agencies have managed to deliver growing profit margins for their owners throughout this 25-year period. How was this possible? Are agencies still “fat,” as many procurement executives believe, or have they starved themselves to generate profits in the face of declining prices?
Agencies Struggle with Declining Prices
