The $5-10K Retainer is Dead

And Most Agencies Don't Know It Yet

📢 AI will do to agencies and professional services what the Internet and Social did to newspapers and journalism. A few agencies will grow bigger but most will die and be replaced by new entrants using agents, data, and community to niche down and differentiate. Our webinar will focus on the trends driving this transition and the tools agencies need to start using to be one of the survivors.

Don’t be a casualty. Register for our free webinar. 

I was on the 21 Hats podcast last week talking with two agency owners. Both smart people. Both embracing AI. Both building great businesses.

But halfway through our conversation, this line popped into my head:

AI is going to do to agencies what the Internet and Social did to newspapers and journalism.

There's going to be a smoking crater where that $3-10K monthly retainer used to be.

The Helper Fantasy

Most of us have a comfortable story about AI. It'll do the scut work we don't like. Handle the research. Write the first drafts. Be our helpful assistant while we focus on strategy and relationships.

It's a nice story. And partially true.

But it's also dangerously incomplete.

The Research Revolution

AI can already do the deep research that used to take agencies weeks. Want to know the latest market tactics? The most current strategies? Best practices across every industry?

ChatGPT, Claude, and Gemini can gather and synthesize that information in minutes, not months.

Then I can build a GPT that uses that research to create marketing strategies, customer profiles, and campaign assets.

Take my Ideal Customer Profile GPT. It walks you through identifying your ICP step-by-step, all based on current best practices. That's 30 minutes of work that used to require hours of agency consultation.

And that's just with today's tools.

The Agent Era

We're about to enter the age of AI agents. These aren't just chatbots – they're autonomous systems that can take actions on your behalf.

AI agents are software programs that can perceive their environment, make decisions, and take actions to achieve specific goals without constant human oversight.

The web is being redesigned around an agent-centric protocol. Here's what that means for agencies:

These agents will design ads, test them against your customer personas, submit them to Google or Meta, and optimize your campaigns automatically. They'll measure results and find better ways to achieve your goals.

All without human intervention.

The Meta Reality Check

Mark Zuckerberg recently said something that should terrify every agency owner:

Eventually, Meta won't even need your ideal customer profile or ad copy. You'll bring cash, they'll deliver customers.

Why have a creative strategy when you can A/B test 100,000 versions of your message in seconds?

Why pay thousands in monthly retainers when you can pay tens of dollars for the exact outcome you want?

The Journalism Parallel

Remember what happened to newspapers? The Internet didn't just change how news was distributed – it changed who could create and distribute news.

Suddenly, anyone with a blog could be a journalist. Social media made everyone a publisher. The gatekeepers became irrelevant.

The same thing is happening to agencies. The tools that were once exclusive to professionals are becoming available to everyone.

The Survival Strategy

So how do agencies survive? The same way a few journalism organizations did:

Become the agent, not just the user.

Build community around your unique perspective. Niche down ruthlessly. Embed your process into software and scale it.

From that scale, you get something the LLMs don't have: proprietary data.

The Specialization Imperative

Things are about to get hyper-specialized. Instead of "marketing agency," you'll need to be "the conversion optimization specialist for SaaS companies in the healthcare vertical."

Instead of "we do social media," you'll need to be "we help manufacturing companies build communities that drive B2B sales."

The broader you are, the easier you are to replace with AI.

The Community Defense

The agencies that survive will be the ones that build communities around their expertise. Not just client relationships – actual communities of people who value their specific insights.

When you have a community, you have data. You have feedback loops. You have something AI can't replicate: human connection and trust.

The Data Advantage

Here's the key insight: When you embed your process into software and scale it, you generate data that general-purpose LLMs don't have.

Your specific approach to helping manufacturing companies with social media. Your unique method for optimizing SaaS conversion funnels. Your proprietary insights about healthcare marketing.

That becomes your moat.

The Building Opportunity

The good news? You can start building these systems today. AI makes software development accessible to non-programmers.

I've been building OwnerRx using AI tools. What used to take teams of developers months can now be done by one person in weeks.

In my next post, I'll walk through exactly how I'm building software with AI tools. Spoiler: You can do it yourself in hours and days, and it's getting easier every day.

The Choice

Agency owners have a choice to make:

  1. Keep doing things the old way and hope AI stays in the helper role

  2. Recognize the disruption coming and start building the new model now

The first option feels safer. The second option is actually safer.

Because the $5K retainer isn't just threatened – it's already dead. It just doesn't know it yet.

Ready to build an AI-proof business model? More insights on surviving the transition at ownerinstitute.comWant to see what's possible with these new AI tools? I'm sharing examples in the newsletter at ownerinstitute.com

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