The digital agency landscape is undergoing a profound transformation. With the rise of AI, evolving client demands, and operational hurdles, agencies are rethinking how they operate, acquire clients, and grow.

To illuminate these trends, Vendasta and Dialog surveyed 294 U.S. digital agencies, uncovering how agencies of all sizes—small (1–10 employees) and large (200+ employees)—are navigating this dynamic landscape.

This blog highlights the key findings behind small vs. large agency trends, what they mean for the future, and actionable strategies to stay ahead. 

Table of Contents

• How Agencies Are Adopting AI to Accelerate Growth
• Growth Challenges: Client Acquisition and Retention
• The Divide Between Small and Large Agencies
• Why AI Will Shape the Future of Agencies
• The Future of Digital Agencies

How Agencies Are Adopting AI to Accelerate Growth

AI adoption is no longer optional for agencies—it’s essential. According to our findings, 87% of agencies are already using or testing AI to improve efficiency, client acquisition, and service delivery.  Here are the core differences between small vs. large agency AI trends:

• Small Agencies focus on tactical tasks like content creation and SEO to streamline execution and improve productivity.
• Large Agencies are harnessing AI strategically for high-impact activities like competitive analysis and advanced client insights.

The benefits of AI are clear: 55% of agencies report increased revenue due to AI’s ability to unlock productivity and strategic advantages.

However, concerns persist, such as pricing pressure for smaller agencies and rising client expectations for larger firms.  You should explore scalable AI tools tailored to your agency's size and needs. Small agencies can start with workflow automation and creative tools, while larger agencies can integrate AI into strategic planning and client acquisition.

Growth Challenges: Client Acquisition and Retention

Our report found that client acquisition remains the top challenge, cited by 52% of agencies.   Here's how client acquisition strategies differ:

• Small Agencies rely heavily on referrals (80%) and networking (50%).
• Large Agencies adopt diversified strategies, including email marketing, search campaigns, and social media advertising.

Client retention strategies also vary significantly:

• Small Agencies prioritize foundational services like SEO and website design.
• Large Agencies focus on scalable, high-impact efforts like paid search and influencer marketing.

What does this mean?

Small agencies should diversify acquisition channels through digital campaigns and build authority via content marketing, like webinars or gated resources.

Large agencies should continue refining multi-channel efforts and leverage advanced digital tools to attract enterprises and franchises.

The Divide Between Small and Large Agencies

Small agencies often operate as generalists, offering services like SEO, business profile management, and website design. Large agencies, on the other hand, have specialized offerings such as brand marketing and influencer campaigns, allowing them to cater to high-value clients like enterprises and franchises.  Here’s what we found for the average spend between small vs. large agencies: 

• Small Agencies spend an average of $1,950/month per client, with a median spend of $749.
• Large Agencies spend significantly more, averaging $10,861/month per client, with a median spend of $8,750.

This disparity highlights the need for small agencies to scale efficiently while remaining cost-conscious.

Why AI Will Shape the Future of Agencies

AI’s impact on retention, revenue, and costs is reshaping agency operations:

60% of large agencies report that AI significantly improves client retention, compared to just 10% of small agencies.  Large agencies also see stronger revenue growth, with 40% attributing significant gains to AI investments.  But AI isn’t just for large agencies. Small agencies are leveraging AI for cost reduction, with 70% expecting automation to lower operational expenses.

What does this mean?

For small agencies, leveraging AI for efficiency gains in areas such as social media content creation, SEO, and email marketing can streamline operations and improve productivity. 

Meanwhile, large agencies can capitalize on AI by integrating it into decision-making processes, conducting competitive analysis, and creating visually impactful campaigns that drive engagement.

The Future of Digital Agencies

The findings in this report make it clear: agencies must adapt to thrive. AI and automation are no longer “nice-to-haves” but essential tools for efficiency, client retention, and revenue growth.

For small agencies, the path forward lies in maximizing tactical efficiencies and diversifying offerings to compete with larger players.

For large agencies, staying ahead means doubling down on innovation and delivering high-value, scalable solutions for enterprise clients.

How Vendasta Helps Small and Large Agencies Thrive

Vendasta empowers both small and large agencies with the tools and insights they need to navigate today’s competitive landscape and achieve sustainable growth

Whether you're a small agency looking to scale efficiently or a large agency aiming to maintain your competitive edge, Vendasta provides tailored solutions to meet your needs.

For Small Agencies:

Vendasta helps small agencies streamline operations and enhance productivity with AI-powered tools that simplify tasks like social media content creation, SEO, and email marketing.  By automating time-consuming processes, small agencies can focus on scaling their services, improving client acquisition, and delivering impactful results—all without overextending resources.

For Large Agencies:

For larger agencies managing diverse client portfolios, Vendasta offers advanced tools for data-driven decision-making, competitive analysis, and personalized client engagement.

These solutions enable large agencies to stay ahead of the competition by innovating with high-impact campaigns and delivering exceptional value and proof of performance reporting to enterprise clients.  With features like automated reporting, AI-driven marketing solutions, and a robust marketplace of services, Vendasta ensures that agencies of all sizes can enhance efficiency, strengthen client relationships, and unlock new revenue opportunities. 

Your Roadmap to Agency Success Starts Here

Explore the complete findings of small vs. large agency trends in our Digital Agency Pulse report, packed with actionable insights and strategies to help agencies of all sizes thrive:

→ Download the Full Report Here ←

Whether you're a small agency looking to scale or a large agency focused on maintaining a competitive edge, this report provides the data and recommendations you need to thrive in 2025.

To learn more about Vendasta and how we can help your agency stay ahead in the new year, let’s get in touch.

Vendasta is your partner for scalable, AI-driven success. Discover how our platform can help your agency achieve measurable growth and deliver unparalleled client value. Request a demo today!