Navigating the Future of Agencies: Insights from My Fireside Chat with Klaviyo

On February 26, I had the pleasure of joining Jeremy Singh from Klaviyo for a fireside chat, diving deep into the evolving landscape of agencies, technology, and customer experience.

We tackled some of the biggest challenges agencies face today. How to integrate new services without disruption (too much disruption I should say), the shifting role of customer experience, and how AI is reshaping the way agencies deliver value. Below are some key takeaways from our conversation.

1. Evaluating and Integrating New Services Without Disruption

Technology moves fast. Arguably 5 years ago agencies where driving tech to be better and now it seems to be the opposite. Mid market tech is moving really fast as they start to play in the enterprise arena and many agencies are struggling to keep up.

Agencies and brands alike are constantly assessing new tools, but the real challenge is adopting the right ones without breaking what’s already working. I see this as a two-part process:

• Technical Fit: What problem does this technology solve? Can it integrate seamlessly with existing tools and workflows?
• Strategic Fit: Does it align with the agencies Ideal Customer Profile (ICP), product roadmap, and marketing strategy? Or should we adapt our strategy to certain technology partners strategy?

The idea of “best in breed” is subjective. What works for one brand or retailer might not work for another. Instead, success comes from deep knowledge of how clients actually use these tools and guiding them through implementation.

One key insight? Even the most powerful tech can fall flat without the right team driving it. The most successful agencies pair technologists and strategists to eliminate blind spots.

Reading the Klaviyo benchmark report it really hit me that agencies implementing tech without understanding the power of the tech is dangerous terrain in 2025. You move into the order taker category. Commodisation is next.

Campaign order rates are more than 5x higher for the top 10% of campaigns across both email and SMS. For the top-performing campaigns, revenue per recipient (RPR) is 7x the average. Klaviyo 2025 Bench

2. The Common Mistakes Agencies Make When Managing Change

One of the biggest challenges for agencies today? Team structure.

We’re witnessing a shift. Agencies need to move from the traditional "order taker" model to becoming true consultants and strategists.

With AI-driven efficiency reshaping industries, agencies need to rethink roles:

• Are we over-indexed in certain areas?
• Can we automate repetitive tasks to free up strategic thinking?
• Are we still delivering true value, or just selling hours?

The agencies that thrive will double down on subject matter experts and strategists. people who unlock opportunities rather than simply execute tasks. However, the key is staying aligned with existing client needs, deepening relationships, and driving higher retention.

3. The Next Big Opportunity: Data & the Rise of Operational Experience (OX)

Customer data is everything blah blah blah. Brands and retailers need to have a very clear view on how they think about data, how they use it and where the blind spots are.

In the last five years, we’ve seen brands introduce Chief Digital Officers, then a slight pivot to Customer Experience Officers, but now, the real power lies in Operational Excellence (OX).

The question is: who is truly looking after the customer?

Some of the smartest agencies (like Limesharp , for example) are already pivoting, hiring Customer Experience Strategists to bridge the gap between brand, data, and experience. This is part of their move to having a dedicated Strategy Department. I really like this approach. Another interesting move is from Domaine who are introducing a Retention Department. These leading agencies are already seeing the shift necessary to keep agencies relevant.

With Shopify and other tech platforms solving the frontend puzzle, the real differentiation now comes from how brands use their data to drive meaningful engagement.

The era of pushing SaaS down every brand’s throat is over. Now it’s about grown-up, strategic engagements.

My advice, from 6.5 years growing a mid market development agency, is to centralise any new service or initiative. When everyone is involved (decentralised) no one is accountable and its chaos. Let's not talk about the poor excuse of wasted R&D budget. I believe in the concept of moving from Centre-led to Centre-supported. This also means you can launch with a small cohort of people, avoiding too much disruption to BAU.

4. AI & The Evolution of Agency Pricing Models

AI isn’t just another trend, it’s here to stay. But does that mean fewer billable hours for agencies?

Yes… and no.

• AI has already compressed pricing in areas like Shopify site builds. What once cost $150K could now goes for $100K (or less).
• SEO is moving in-house for many brands, citing AI as a key driver.

But efficiency doesn’t have to mean lower revenue. It means new opportunities. The shift is from charging for hours worked to charging for value delivered.

Agencies need to be crystal clear on which type of business they are, you need to do all 3 to a standard however one should be your clear winner:

1. Product Leadership: Innovators with unique offerings.
2. Operational Excellence: The most efficient & cost-effective.
3. Customer Intimacy: Deeply embedded in their clients' success.

The biggest risk right now? If you compete on operational excellence alone (lowest cost, least hassle), you’ll find yourself racing to the bottom.

The agencies that will thrive are those that lean into AI and redefine their value proposition not only as executors of ai agents (personally I am dubious of this as few agencies can define the strategy and scaleability here), but as strategic partners driving measurable outcomes.

Final Thoughts: Where Agencies Should Be Focusing Next

Technology, data, and AI are reshaping the agency landscape. But the core principle remains unchanged: The agencies that win are the ones that understand their customers best and deliver real impact.

🔹 Move to the hybrid Strategy/Agency model.

🔹 Invest in strategy and customer experience expertise

🔹 Want to be the seen as the expert in Shopify / Klaviyo / Yotpo / fill the gap ? Make sure you have subject matter expert on the team.

🔹 Leverage data-driven insights to drive retention and revenue.

🔹 Shift from time-based billing to value-based pricing.

🔹 Stay two steps ahead. Especially as AI reshapes marketing services.

There’s no single “right” model for agencies in 2025. But one thing is certain: those who embrace change, stay ahead of client needs, and focus on outcomes over hours will own the future.

Let’s keep the conversation going. How is your agency adapting to these changes?