AI has changed the production equation. It has not removed the need for experienced judgement, independent challenge or excellent craft.
Someone asked me recently whether Challenge should still call itself a marketing agency.
It has been playing on my mind ever since. Then, a few days later, somebody asked a harder version of the same question. Perhaps agency is not the outdated word. Perhaps marketing is.
I run a marketing agency, so neither is a particularly relaxing thought.
I am not writing this from the sidelines. Agency land is tough. Challenge is feeling it. So are friends, former clients and people I have known in this industry for years. There are exceptionally experienced marketers, writers, strategists and creative directors looking for work right now.
Meanwhile, the conversations I am having with clients have changed. “We are doing more ourselves.” “We are using AI for that.” “Can you show us how to do it better?” “Can you look at what we have made and improve it?” “Can you help us work out where to start?”
That last group of questions interests me most. It does not sound like a client who needs less expertise. It sounds like a client who needs expertise in a different place.
Making things got easier
A marketing team can now create copy, decks, social posts, images, research, campaign routes and increasingly capable video without automatically commissioning an agency. That is a meaningful change.
The data follows the behaviour. Marketing Week reported that 15.2% of B2B marketers in its 2025 State of B2B Marketing survey had reduced agency spend specifically because of increased AI use. Forrester’s 2026 research describes a similar shift. AI is allowing more work to move in-house and making B2B marketers more selective about where they use external agencies.
The majority have not cut agency spend, so this is not a collapse. But for an industry that has historically made a great deal of its money by assembling people to make things, the direction of travel is clear.
What clients have not stopped valuing
The picture is not as simple as clients no longer needing agencies. The IPA and Tracksuit’s recent research with 200 senior brand-side decision-makers found that nine in ten believe their agencies are either central to commercial success or contribute meaningfully to their results. Nine in ten also expect their agency use to increase or remain the same over the next three years.
It also found that excellent asset production is the capability clients value most, cited by 83% of respondents. Craft still matters. A lot.
But the same research reveals the part of the relationship that too many agencies are failing to deliver. Among C-suite, EVP and VP respondents, 85% say they highly value an agency challenging their brief and assumptions. Only 37% believe they receive it.
AI has reduced the production constraint. It has exposed the judgement constraint.
That is the issue. A capable in-house team can now make far more, much faster. But speed does not tell them whether the brief is right, the positioning is distinctive, the campaign is solving the right problem or the work will persuade anyone outside their own organisation.
And AI cannot create the distance that a good external partner brings. If the same person frames the question, prompts the tool, chooses the answer, develops the work and approves it, who is left to challenge the premise?
The task is not the job
AI can perform a growing number of marketing tasks. Marketing was never simply a collection of tasks.
It is understanding people and markets. Making choices. Creating preference. Building trust. Finding a position worth occupying. Deciding what not to do. Persuading another human being that something is worth their attention, time or money.
I can generate fifty campaign ideas before breakfast. That does not mean I have fifty good ideas. When everybody can produce more, producing more stops being an advantage. Knowing what deserves to exist becomes one.
My view is that clients increasingly need someone to make the difficult 20% excellent, rather than an external team to staff the routine 80%. That is not a rejection of production. It is a more selective use of it.
There is a second thing worth watching, particularly in B2B. Everybody is reaching for the same tools, trained on much the same material, prompted in much the same way. The result is not a flood of bad work. It is a flood of ‘acceptable’ work that looks and sounds like everybody else’s.
That is then a commercial problem, not a matter of taste. If a buyer cannot tell you apart, you stop earning attention and start buying it. The scarce thing in a market full of simply ‘competent’ output is not competence. It is a reason to look twice.
This is where I would defend creative people most strongly. Not because machines cannot make things. Because somebody has to decide what would be worth making that nobody else is going to make.
So what is an agency for now
I do not think the answer is to throw the word agency away and replace it with consultancy. Consultancy can imply that somebody comes in, produces a deck and leaves. Challenge can do more than that, and it should.
For us, the shift is about what sits at the front of the relationship.
Diagnose. Understand what is actually happening, from evidence rather than assertion.
Challenge. Bring the outside perspective that an internal team and its AI tools cannot give themselves, including on the brief itself.
Enable. Help people use AI, behavioural science and creative thinking more effectively in their own hands.
Make. When the work genuinely warrants specialist craft, bring the right people together and make it excellent.
The fourth remains important. But it becomes an option, rather than the whole business model.
That is not a cosmetic change. It affects what we sell, how we price it and where we apply experience. It is the direction behind Challenge’s Visibility Intelligence Programme and the Engagement Intelligence work we are building. The work begins by helping a client see more clearly, decide more confidently and act where the evidence points.
A question worth asking
Look at the last six things your team produced with AI. Do not ask only whether they were made quickly or whether they look polished. Ask whether anybody outside the room challenged whether they were the right six things to make.
If the answer is no, that is not an AI problem. It is the gap.
The principle underneath Challenge has not changed. Engagement is everything. What is changing is where experience has to be applied to create it.
Research notes
IPA and Tracksuit, Bridging the gap: Redefining the value of agencies, 8 July 2026. Read the IPA summary
Forrester, As AI Use Expands, B2B Marketers Become More Selective About Agency Spend, 15 July 2026. Read the Forrester analysis
Marketing Week, Almost a fifth of large B2B brands cutting agency spend in favour of AI, 2025. Read the Marketing Week report
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