Observed Signal · Oct 1, 2026 · Research Report · Source: VideoWeek · Impact: 3/5 · Sentiment: Positive
Global Brands Ditch Labour-Based Agency Fees, WFA Finds
A new report from the World Federation of Advertisers (WFA) and Agency Mania Solutions, titled 'How Brands Define, Scope and Reward Agency Work', reveals a significant shift in agency compensation models. Based on responses from 69 multinational companies with a combined marketing spend of $147 billion, the report finds that labour-based payment models, which were dominant in 2011, now represent the main compensation model for only 19% of global brands. Meanwhile, fixed-fee/output models have risen to 33%, and 'Labour + Performance' models to 21%. Performance-based fees show the strongest momentum, with 63% of multinationals expecting to increase their use, driven by AI, which is compressing labour hours. However, only 20% have evolved their commercial models in response to AI, though 61% intend to. The report also notes a shift in focus towards factors like briefing quality and trust over financial incentives.
This report highlights a significant industry-wide shift in agency compensation models, moving away from labour-based fees towards output and performance-based models, driven by AI. It directly impacts how agencies and brands structure their commercial relationships.
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Key Takeaways & Evidence Grounding
- Labour-based payment models now represent the main agency compensation model for only 19% of global brands, down from dominance in 2011.
- Fixed-fee/output models have risen from 20% to 33% over 15 years.
- 71% of respondents were in global marketing procurement roles.
- 63% of multinationals expect to increase use of performance-based fees.
- Only 20% of brands have evolved commercial models in response to AI, but 61% intend to.
Connected Companies & Entities
2 Entities mapped“The World Federation of Advertisers (WFA) and Agency Mania Solutions have produced a report on agency remuneration....”
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