De Facto Collapse of the Holding Model: Why 2025 Ends the Era of Agency Empires
The year 2025 will be remembered in the communications industry not as “just another restructuring,” but as the moment when the era of comforting narratives about synergy and scale effectively came to an end. On paper, the IPG–Omnicom merger creates the largest group in the world. In practice, its first and most tangible outcome is a wave of job cuts - and a ruthless clean-up of the portfolio. At the same time, Dentsu has been trying to sell international assets - as if global reach, treated for decades as the price of admission, had suddenly become dead weight. And WPP, the emblem of the former “marketing services empire,” has seen its share price collapse by more than 50%, leaving the company valued by the market at a level that would have been incompatible with a leader’s ambitions not long ago.
These three facts are not anomalies. They are proof that the holding model, in its current form, has de facto run out of road - not because the world no longer needs communication, but because the holding has stopped being the best answer to the client’s question: “How do we grow?”
The most telling sign of this shift is the “quiet liquidation” of agency brands. Institutions that for decades carried culture, method, memory, and relationships. When we hear talk of “simplifying” and “merging,” it often translates in practice into the extinguishing of identity. The funeral bell has rung for Leo Burnett: Publicis has unified Leo Burnett and Publicis Worldwide under a new creative constellation, Leo. FCB has been absorbed into BBDO. DDB has been rolled into TBWA. MullenLowe has also been consolidated into TBWA.
These are not cosmetic moves on an org chart. They mark the end of an era in which an agency brand was a real entity - not a label on a slide deck, but a talent academy, a craft standard, and a client’s “home.” The mechanics of this decline are no secret; they are the consequence of four strategic decisions holding companies made over many years. Each rational “in the moment,” yet collectively lethal to the very idea of the agency as a true partner.
First, holding companies separated media buying from creative agencies - decades ago in Europe and a quarter-century ago in the United States. Economically, it made sense: transparency, negotiating power, specialisation. But the net effect was different: agencies were stripped of their right to design the decision architecture. Strategy, once the centre of gravity in the client–agency relationship, was deprived of its bloodstream: data, measurement, optimisation, and accountability for outcomes. In practice, creativity began to function like a production cost rather than an investment in brand growth. And a cost, as everyone knows, gets standardised, unified, and cut.
Second, holding companies began organising their structures by function. Media became a single P&L, while brands like OMD or Mindshare are often maintained primarily to manage client conflicts. The same move then started to engulf advertising: Omnicom Advertising coordinates the group’s agencies as a single organism - and WPP has been signalling a push toward a simpler, more integrated operating model of its own. Once function matters more than brand, the brand becomes expendable. And with it go senior roles - expensive, yes, but crucial: they sustain relationships, build trust, and give clients a sense of continuity. In a functional world where you “deliver scope,” seniority is too often seen as cost, not advantage.
Third, WPP introduced horizontality: building client teams from the best talent across the entire holding. The idea sounds compelling, but the consequence is predictable: the dismantling of relationship “rooting” within an agency. In the past, the client had a “home,” as with JWT serving Ford for a hundred years. Later, through successive WPP integrations, that home was systematically taken apart: Y&R was merged with VML, JWT with Wunderman, and then Wunderman with VML. What looks from headquarters like a tidy-up of brands and costs often feels to the client like team rotation, diluted accountability, and the loss of institutional memory. Once client leaders began reporting directly into the holding, the agency was reduced to regional account management, or to supplying talent for “Team Coca-Cola.” The fundamental role of the agency as a creative and strategic partner disappeared, replaced by a logic of “resource assembly.”
Fourth, holding companies took away agencies’ growth engines - precisely the areas that could have rebuilt their economic and strategic rationale. Health, commerce, and influencer marketing became assets of “global collectives” rather than platforms for agency development. One example is particularly stark: FCB Chicago was a strong, multi-sector agency, yet its health capabilities were carved out into FCB Health and then folded into IPG Health as a holding-level structure. The same pattern appears in influencer marketing: acquisitions of influencer agencies by WPP or Publicis could have fuelled creative or PR brands; instead, they often landed inside media structures as part of a content distribution “flywheel.” The result is that agencies lost the right to reinvest in the future on their own P&L. Even when a local business is entrepreneurial, its success is frequently “redirected” to the centre. That kills a culture of growth and produces an organisation that excels mainly at cutting costs.
In the background, a force larger than any merger is at work: today, the real competitor to holding companies is not other holding companies, but the client-side “marketing operating system” and the tech platforms. Clients are building their own first-party data, CRM, e-commerce, retail media, content automation, and in-house production studios. Platforms are closing the loop - planning, creation, distribution, measurement - while AI lowers the cost of many tasks that have long been the agency’s daily bread. In such a world, a holding that is essentially a patchwork of silos loses its edge: instead of accelerating, it slows; instead of integrating, it complicates. The client does not need a supplier’s empire. The client needs a growth partner.
That is why the phenomena we see today: centralisation, brand consolidation, senior reductions, asset sales, and narratives about “AI-driven transformation” — add up to one picture: the holding is moving from a growth model to a managed-decline model. And the “de facto collapse of the holding model” is precisely this: the holding has stopped being an answer to “how do we build advantage?” and has become a tool for “how do we survive the next year and protect margins?”
What comes next? Two scenarios, and both are unfolding in parallel. The first is the super-integrator: two or three global groups remain, truly building a shared system of data, technology, production, and distribution, while agency brands serve mainly as a front-end for conflict management. The second is a modular world, in which the client keeps the “operating system” in-house and selects partners by task: brand strategy, creativity, media, retail, influencer, studio, analytics. In both cases, the era in which the holding was the natural centre of gravity is coming to an end.
If the industry is to recover its meaning, it must return to a unique value that cannot be squeezed out of an org chart: strategic thinking, creativity with measurable business impact, and the ability to connect that creativity with data and distribution within one coherent system of accountability. Otherwise, “the agency” will remain only a memory: a beautiful brand in the history of communications, rather than a living growth partner. And its heirs will gradually be specialised boutiques and strong local independents.
De facto.
