What are the patterns that are shaping growth in our sector? Why does agency size matter? How does location drive opportunity? Which specialisms are fueling growth across the agency subsectors? The Growth Report digs into the detail behind the 7.3% agency sector growth rate we published in our Agency by Agency Industry Report, to take a look at what’s really going on in our diverse and dynamic industry.
The Growth Report, published this week and available to subscribers of Agency by Agency, reveals not one story of growth but multiple narratives, playing out across regions, subsectors and agency types; patterns that could reshape how you think about positioning, scaling and strategy however you are involved in this sector of ours.
The growth paradox
What emerges from our analysis is a fascinating paradox at the heart of the agency sector. While the industry often celebrates high-growth success stories, the reality is decidedly more nuanced. A relatively small minority of agencies are driving disproportionate economic impact, while the majority of the sector remains remarkably stable, suggesting differing approaches to strategy and measurements of success.
It reminds us again that growth is not a simple story of winners and losers. It is a story of different approaches to building a sustainable agency business. And for those aiming to grow, the report offers interesting insights into scaling agencies, including perhaps surprising advantages for specific size ranges and the specialisms that are fueling high growth.
Specialisation and a shifting agency landscape
Indeed, perhaps the most striking pattern we’ve uncovered in The Growth Report is how dramatically new specialisms are outperforming traditional agency strongholds. This isn’t simply about new services replacing old ones, but suggests a movement away from generalist approaches towards agencies that can solve specific, complex problems exceptionally well.
What makes this particularly compelling is that some of the fastest growing subsectors are also those with the highest proportion of newly founded agencies, suggesting sustained demand rather than temporary market bubbles. The implications for agency positioning are potentially profound.
Size, scale and the sweet spot
The relationship between agency size and growth also reveals patterns that might challenge conventional wisdom around scaling. While large agencies show higher proportions of fast growth, the actual concentration of high-growth agencies tells a different story.
It might just be that there is something like an “optimal growth zone”, a specific size range that seems to offer unique advantages for rapid expansion. These agencies appear to be large enough to have developed real capabilities but small enough to maintain the agility that larger competitors lose.
Meanwhile, the smallest of agencies show remarkable levels of stability, suggesting deliberate strategic choices that prioritise different outcomes than pure growth.
Beyond London
While the capital remains the sector’s gravitational centre, some of the most interesting growth stories are happening elsewhere. Several regions beyond the capital are showing growth rates that dramatically exceed the sector average, raising questions about untapped opportunities and shifting market dynamics. At the same time, high growth rates in some regions also come with increased volatility, suggesting that opportunity and instability can often go hand in hand in emerging markets.
Stability as strategy?
Perhaps most intriguingly, our research suggests that the industry’s growth obsession may be missing something fundamental about what makes a successful strategy in the eyes of many founders and leaders. The vast majority of agencies operate in what we classify as “stable” growth categories. Is this sophisticated strategic thinking or a lack of ambition? What does success look like anyway?
At the same time, the relationship between high-growth subsectors and regions with volatility also reveals important considerations for agencies, investors and advisors. That some of the fastest growing regions and subsectors also have the highest proportion of rapidly shrinking agencies suggests that aggressive growth strategies also come with operational risks.
What does it all mean?
The patterns that have been identified in The Growth Report raise interesting questions about positioning, scaling and strategic priorities. Whether you are a solo founder considering your first hire, an established agency evaluating expansion opportunities or an investor assessing the sector’s landscape, these insights challenge many assumptions around what success looks like in the modern agency world.
The agencies thriving in 2025 are not necessarily doing different work, but there is a good chance they are making different strategic choices about how to position, scale and optimise their operations.
Find out more…
The Growth Report is available now for subscribers to Agency by Agency. If you are not yet a subscriber, but would like to explore all our findings and insight in more detail, you’ll find subscription options here. As well as access to The Growth Report, you’ll also get full access to our library of reports and articles, benchmarking data for 28 agency subsectors, and the Agency Toolkit with articles, workshops and downloadable resources to build a smarter agency.
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