This post was created in partnership with Pendulum
AI is already reshaping the way agencies do business, but the biggest changes are yet to come.
During an ADWEEK House Cannes Lions fireside chat co-hosted with Pendulum, Mark Listes, co-founder and CEO of Pendulum, and Michelle Hutton, global chief client and growth officer at Burson, unpacked the coming “intelligence era.” They dove into what it means for agencies, how clients will adapt, and why AI-wary professionals can rest easy.
Opening new frontiers
Both speakers agreed that agencies are on the verge of a fundamental transformation, with AI agents and infrastructure replacing old workflows. Although the industry is accustomed to change—Hutton traced its evolution from generalist to specialist models, then post-pandemic agile approaches—this one is different in scale and in kind.
“We’re at the tipping point for what will be the next material change in the way agencies are structured,” Hutton said, deeming it the “intelligence era.”
But what will that change look like? As Listes observed, most agency AI use is for ideation and image generation; it’s an efficiency multiplier, but not yet a revolution. The question is whether AI will grow into something that agencies either sell or fold into their existing approaches, or if it will empower them and open new frontiers entirely.
Hutton’s answer: Those frontiers are already open. Over the last year, her braver clients have embraced advanced data analytics as a means of targeting specific communities and reaching them in authentic, culturally relevant ways. “You don’t have to be the loudest now to be the most effective,” she reflected. “In fact, it’s the opposite.”
Caring for people and teams
As agencies cross that tipping point, they will face messaging hurdles on two fronts.
The first is commercial: shifting to value-based pricing, which Listes described as “the mecca we all search for,” will mean persuading clients and procurement teams accustomed to time and materials-based pricing. “We have to find a way to care for the people on those teams as we make the transition,” he explained. “We have to account for what looks to be a market-demanded tectonic shift in the way we do business.”
Listes likes an old adage illustrating the value of expertise. A junior and senior locksmith both charge $100 to get you into your house, even though the junior takes a full hour and the senior only takes a few minutes.
“For some reason, we psychologically struggle to pay that senior person an hour for it,” Listes explained. “What we’re paying for is the age-old wisdom. In our world, it’s the taste of decision-making, not the struggle of getting there.”
