Creative Agency Percentage Compensation
To understand the average percentage creative agencies charge as fee against the total media spend of the brand in order to share the data internally.
- Our preliminary research suggests that there hasn't been any recent study or survey into the average percentage of a brand's media spend creative agencies charge as fees against the total media spend of the brand.
- Our research revealed several reports and articles stating that creative agencies generally charge 15% of the brand's media spend as fees, but none of the report was an actual study, survey, or research. However, 10% is also common, while up to 25% is also possible.
- The 15% agency fee was first introduced in 1869 when N.W. Ayer and Son, an ad creative agency, negotiated a deal with the media, and it has remained in place for over a hundred years and is still adopted by some agencies today.
- Despite the fact that many agencies have replaced the 15% agency fee with fixed rates, specific fees, and other similar payment structure, the benchmark income for most creative agencies is still 15% of media spend of their clients' total media spend, regardless of how the agency's fee is structured.
- Programmatic advertising is recently gaining ground and a recent Association of National Advertisers study on agency compensation found that "there is a bit of a resurgence of 15% deals in the programmatic space" as brands are pushing for a simpler agency fee structure.
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