TL;DR

• The 2025 Digital Agency Web Host Report, get your copy here.
• Privately, many agency leaders are uneasy about where to steer their firms.
• Their key concerns lie in AI, growth, and team management.
• AI is obvious, but anemic growth has made team management almost impossible lately.
• Fixing growth can make management easier.
• We summarized responses from 50+ agency leaders over the last few months to find pockets of strength and where they're seeing weakness.
• Leaders most often flagged financial services/real estate, healthcare, and “IT/tech/AI” as strong‑demand verticals.
• Ecommerce/retail, higher ed, and nonprofits were the softest.
• If you’re reading this and thinking “that's us”, then the Custom Strategy Creation program might be the push you need. It’s an intense engagement that delivers a decision-ready growth plan and the financial blueprint to support it.

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2025 Digital Agency Web Host Report

Five hosts stood out as leaders in our recent 2025 Digital Agency Web Host Report, but most are a simple pricing change, feature release, or market shift away from leapfrogging the others. The C1 and C2 hosts are at real risk from the C3 group.

Get your copy to see how the top hosts ranked across security, speed, uptime, support, pricing, scalability, workflow integration, brand perception, and partnership programs.

Agency Vibes

I’m fortunate enough to chat with several new agency leaders each week. I’ve purposely kept Promethean small, mainly because a significant portion of the value we add comes from our awareness and understanding of how this industry is evolving. Being small keeps us as close as possible to these evolutions, and I believe it makes us better advisors.

As Gen-Z as it sounds, a key part of this understanding is vibes.

What’s the general temperature of the market, what’s driving it, and how is that impacting leader decisions? Knowing that lets us game out better strategies for our agency clients. It also allows us to focus our research on topics that actually matter to agency leaders.

So, what’s the general vibe of agency leaders?

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Unease

At least privately it’s unease.

Publicly, the typical bravado is still rampant across LinkedIn, conferences, and client conversations. But privately, leaders are telling me they’re not sure where to go.

Their main concerns revolve around AI and what it’ll do to their businesses, but that’s a longer-term question in their minds, so we won’t dive into it here. Stay tuned for a full report on this in a few months though!

The more prominent challenge lies within agency growth prospects.

By now, most shops have right-sized their teams to deal with the anemic sales velocity they’ve seen over the past 3-ish years. I’ve written (and presented at DE{CODE} and GatherUp conferences) about how they’ve shifted to more contractor-heavy models, trading margin upside for flexibility.

But these adjustments can only go so far.

Agencies still need sales to make this whole thing work, and they need reliable growth in sales to make life easier. The lack of meaningful growth in recent years has weighed on the industry as a whole.

Finally, a number of leaders have commented on the challenges that exist in managing the talent who are left.

I just mentioned how growth makes life easier. That’s because it allows individuals within the agency to grow as well. Most people don’t want to be stuck as a Copywriter II for their entire lives.

When the agency isn’t growing, the talent doesn’t have anywhere to advance to. There aren’t new roles needed, so employees aren’t promoted. They don’t get raises, or bonuses, or new experiences. Leaders don’t have conviction in the agency’s future financial position, so employee perks fade. You can’t prudently invest in growth if you don’t believe it’ll be there.

All this combines to make management an impossible task even in perfect scenarios. And we all know running an agency is far from a perfect scenario.

So the vibes are uneasy, but if we fix the growth challenge, it makes management significantly easier.

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Pockets of Strength

Even through the unease, we’re hearing about some pockets of strength.

In our chats and survey work, leaders most often flagged financial services/real estate, healthcare, and “IT/tech/AI” as strong‑demand verticals, while naming e‑commerce/retail, higher ed, and nonprofits as the softest.

Here’s a summary of what we've heard from 50+ agency leaders over the last few months.

Financial services & real estate

Agency owners who work in finance tell me the mood flipped recently. Their regional‑bank and prop‑tech clients have moved from “sit tight” to “get it out the door.” Budgets aimed at faster onboarding, crisper product pages, and measurable media are back on the table, but only for partners who can plug in quickly and can demonstrate results (tighten up those case studies)

Healthcare & pharma

Leaders running health‑focused shops say the policy haze has cleared just enough for systems and drug makers to spend again. Hospitals are finally green‑lighting portal upgrades and patient‑journey fixes they’ve parked for years, while pharma brand teams need compliant content that makes complex science human.

Enterprise tech & AI

Agency leaders who serve B2B SaaS and AI companies keep pointing to the same pain: engineering updates land faster than marketing can absorb them. Product leads push a new module on Monday, and by Friday the website copy, demo deck, and email flows still reference last quarter’s roadmap. Founders can’t show that kind of lag to customers or investors, so they’re hiring outside teams that can jump into the product Slack, learn the feature set in an afternoon, and ship revised assets within a few days.

Ecommerce & retail

The retail‑specialist agencies I spoke with are still feeling the squeeze. Clients are fixated on contribution margin while everything else is a “maybe later.” Rising ad costs and tariff noise mean even growth teams are asking for guaranteed payback within the quarter. The work is still there, but performance-based is winning out as it reduces the client’s risk substantially.

Higher education

Higher-ed‑focused agencies report that RFPs keep circulating, but sales cycles are longer and budgets are tighter. Layoffs, enrollment gaps, and endowment jitters have schools pausing site rebuilds and big campaign ideas. For now, most higher ed dollars seem to be in maintenance and emergency comms, not transformation.

Nonprofits

Agencies serving nonprofits describe a market in survival mode. Large rebranding or mar‑tech projects are stalled as nonprofits rush to backfill grant slashes. There’s a potential bright spot in facilitating grassroots fundraising, but just about everything else looks tough.

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Where to Go From Here

So unease is the baseline, but there are some moves to make that should make 2H25 easier than the first half.

Lean into the strong verticals: Tighten case studies, quantify ROI (the CFO will be evaluating everything), and be ready to slot in quickly. Clients in these sectors typically know what they need, and there's an urgency to the projects, but you still have to convince them you’re the right shop for the job.

Price for speed and iteration: Whether it’s a regional bank onboarding flow, a hospital portal refresh, or a SaaS launch sprint, the work spins up and pivots quickly. Short cycles and transparent metrics beat long discovery phases every time. Use that 80/20 rule to find where the value in your process lies and cut any fluff.

Careful with the weak verticals: Retail, higher‑ed, and nonprofit work isn’t gone, but the hurdles are higher, and the risk of sales stalling out mid-close is real.

Protect your team: Slow growth makes promotions tough, but retaining senior talent is critical when turnaround times keep shrinking. Augment with contractors as needed, but find a way to keep the (good) senior staff interested.

Until next time!

-Nick

We Help Agencies Navigate This

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Several owners told me they feel uneasy about the future of their agency. The market’s shifting, their org is straining, and every path forward looks expensive.

If you’re reading this and thinking “that's us”, the Custom Strategy Creation program might be the push you need.

It’s an intense engagement that delivers a decision-ready growth plan and the financial blueprint to support it.

We’re booked at the moment, but if a fall start would help you turn today’s unease into a clear path for 2026, hit reply and I’ll add you to the waitlist.

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