Why Your £50k/Month Agency Retainer Feels Like It's Doing Nothing
The past few years have been difficult for agency relationships.
Budgets tightened during the pandemic, then again with inflation. Agencies lost senior talent to in-house roles. Clients demanded more for less. And somewhere in the middle, a lot of retainer relationships drifted into dysfunction.
This isn't because agencies became worse at their jobs. It's because the conditions that allow agency relationships to thrive - clear objectives, mutual accountability, aligned incentives - have become harder to maintain.
I've sat on both sides of this. I ran a CRO agency for years and sold it. I've also been the client, hiring agencies and trying to figure out whether I was getting value or theatre. What I've learned is that most retainer relationships fail for structural reasons, not because anyone is acting in bad faith.
The 3 Types of Strategic Misalignment
When I audit an agency relationship, I'm looking for misalignment. This typically falls into three categories.
1. Incentive Misalignment The agency wants to bill hours or retain scope. The client wants commercial outcomes. These goals aren't just different; they often pull in opposite directions.
2. Capability Misalignment The agency pitched with senior strategic thinkers. Delivery is handled by capable but inexperienced people who've never sat in a board meeting or felt the pressure of a quarter that isn't landing.
3. Communication Misalignment The agency reports on activity because that's what they can measure. The client wants to know about impact but doesn't know how to ask for it. Both sides end up talking past each other.
The "Activity Trap" and Other Red Flags
Within those three categories, certain patterns appear again and again.
The Activity Trap Every two weeks, you get sprint reports. Tickets closed. Velocity charts. Features shipped. What they rarely mention is whether any of it moved the needle commercially. The agency looks busy. The metrics go up. But revenue stays flat.
The Disappearing Pitch Team You remember the senior people who understood your business within an hour. Then the contract was signed and they gradually vanished. This isn't deception. It's economics. Senior salaries are high, and the only way to make the numbers work is to push delivery down the ladder.
The Scope That Never Shrinks When an agency identifies a genuine efficiency—like a third-party tool that could replace a custom build—they face a choice. Tell you and risk reducing their scope, or keep things complicated because complexity justifies the retainer. (This often leads to the Technical Fragility I see in portfolio brands).
The Metrics You Can't Trust GA4 says one thing. The platform says another. The agency report says something else entirely. Which number is the business actually running on? Usually whichever supports the narrative in that particular meeting.
The Opportunity Cost of Stasis
The problem isn't just the £50k you're wasting on the retainer. The real cost is the growth you aren't capturing while your agency files reports on activity metrics.
In a £50M business, six months of flat growth due to agency inertia costs you far more than the agency fees. It impacts your run-rate, your valuation, and your market share.
When I audit these relationships, I don't just look at the hours logged. I look at the Commercial Velocity. If the agency isn't increasing the speed of your execution, they are an expensive bottleneck.
A Parallel Worth Noting: The Principal-Agent Problem
This dynamic isn't unique to digital agencies. It's a version of what economists call the Principal-Agent Problem: what happens when one party is supposed to act in another's interests but has their own incentives pulling in a different direction.
Law firms face it. Accounting firms face it.
The difference with digital agencies is that the information asymmetry is particularly acute. Most clients don't have the expertise to evaluate whether an agency is doing good work. They're relying on the agency to mark its own homework.
The Retainers That Actually Work
Not every agency relationship is broken. In my experience, healthy retainers share three characteristics:
No long-term lock-in. When either side can walk away with reasonable notice, everyone stays sharp.
Reciprocal accountability. Good agencies push back. They write into the contract what they need from you.
Regular reviews tied to business goals. Not "here's what we shipped" but "here's what moved."
If you feel the partnership has lost momentum
I can audit your agency retainer in five days.
Not to create drama or undermine relationships. Just to give you a clear-eyed view of what you're paying for, what you're getting, and whether the two are aligned.
You'll get an honest assessment: stay, renegotiate, or move on.
I can provide an objective assessment of the commercial value. Enquire about a Diagnostic