In defence of performance agencies ⚖️

Over the next month, you’re going to hear a lot of performance agency bashing on Add To Cart. It’s not deliberate—it just happened. I blame a combination of the moon, Oasis, and an egg shortage.

 The truth is, performance agencies are under pressure. Many aren’t adapting quickly enough, and this is leading to unhappy clients and strained relationships.

 Let’s take a look at what’s changed for agencies recently:

• Skyrocketing Salaries: Salaries, the biggest cost for agencies, have surged in recent years, especially during COVID. The traditional model of selling experience while relying on juniors is under strain—especially since capable juniors aren’t cheap anymore.

• Automation in Advertising: Gaming Meta and Google algorithms has lost its edge, as both platforms now rely heavily on AI for placements, reducing the need for skill and creativity.

• DIY Performance Marketing: A growing wave of independent communities and online resources is empowering founders to take control of performance marketing themselves.

So, yeah, agencies are up against it.

 But if I were managing an eCommerce agency, here’s where I’d focus to unlock the unique value that performance agencies can still deliver.

1. Specialties. Agencies often get greedy. They start with a specific skill set and then expand to fuel growth. It’s the “land and expand” model—like my last Fiji holiday. Instead, find agencies that go deep in areas crucial to your strategic success, whether it’s TikTok creative, modern SEO, or Amazon ads. Mastery in a few key areas beats general competence across the board.

2. Creative. The number one barrier in an agency and eCommerce relationship is the creative. “Your supplied creative is impacting results” becomes the battle cry. With algorithms doing most of the heavy lifting, the best agencies help brainstorm and create new directions for your performance. If your agency hasn’t provided fresh creative ideas lately, it’s time to reassess.

3. Ideation. If your agency thinks performance reporting is just analytics overviews or updates on past performance in weekly WIPs, they’re looking the wrong way. Performance reporting should be open and fluid—available for anyone to see at any time, in real-time. Time spent analysing data should be forward-looking, identifying new creative needs, shifts in targeting, and big disruptive ideas. Your genius insights on last weekend’s Father’s Day won’t help my FY25 results now.

4. Connections. We’ve all seen those big DTC independent communities hosting gala training days and bringing founders together—it looks amazing. The truth is, agencies have niche communities of people just like you, ready to share—if they activate it. Slack groups, small events, personal introductions—if agencies spent as much time connecting their clients as they do writing case studies, value would multiply quickly. Just make sure you’re confident you’re doing a good job, though. We all love a bit of eCom gossip.

5. Time: Bringing performance marketing in-house may sound appealing, especially to eCommerce founders, but it means sacrificing your most valuable resource: time. It means shifting focus away from your products, your team, or your family. In truth, performance marketing isn’t that hard—as long as you have a partner who cares as much as the founder does. There’s a huge opportunity for agencies that nail this.

None of these agency value propositions hang their hat on ROAS. They're much more valuable than that. 

But anyway, enjoy the next few weeks of agency bashing. Some very good points are made, and questions need to be asked of performance agencies. Just make sure you’re asking them too.

Cheers,
Bushy

PS. Shout out to Carla, who (in her typically brilliant way) voiced a similar sentiment on LinkedIn yesterday. I promise I had this drafted. 

ECOMMERCE NEWS

🛒 Amazon’s AI Tool for Aussie Brands: The barriers between DTC and Amazon continue to come down. Amazon now lets Australian eCommerce brands upload a URL and have generative AI create product listings for them. So thoughtful of them.

💳 Refund Preferences Unveiled: Loop and Narvar released reports this week. Narvar’s report caught my eye—62% of men prefer immediate store credit refunds, while 50% of women will wait 5-7 days for a credit card refund. Time to split test the refund option? 

🌍 Zero Co’s Innovative Packaging: Big shout out to Mike and the Zero Co team for launching a recyclable paper refill dispenser for detergents, shampoo and more. The redesign comes after their previous closed-loop refillable sleeves had a 42% return rate.

🎮 Gaming’s Overlooked Potential: In my view, gaming continues to be the most ignored mass media. Bain's latest Gaming Report shows the opportunity with the video game market now worth more than streaming and box office combined. 36% of gamers are shopping, creating content, and socialising in-game. Sounds stressful. 

🛋️ IKEA Preowned Launches: What are the dimensions?" In an effort to encourage more meatballs and less meatheads, IKEA now helps sell pre-loved furniture, no eBay or Facebook Marketplace required. Sellers get product data access and a 15% bonus in IKEA gift cards. First stops: Oslo and Madrid.

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THAT’S IT FOR THIS WEEK!

I'd love to hear from you. Feel free to reply to this email or contact me on LinkedIn. 

ABOUT NATHAN BUSH

Nathan Bush is an independent Australian ecommerce transformation consultant, with expertise in marketing, technology, and team leadership. If you're looking for fresh ideas, facing key decisions, or implementing significant investments, I'd love to partner with you.