When Wall Street Runs the Agency: How PR Client Service Has Deteriorated Under Holding Companies

Building on my Clario Group Co-founder, Lars Rosene’s prior blog post “Big Agency Model is Collapsing Under its Own Weight”, I’d like to share what many know but aren’t talking about – that client service in public relations agencies is not what it used to be.  This isn’t nostalgia for “the good old days.” It’s a practical observation: PR has become more complex, more compressed and more accountability-driven — and yet, many agency–client relationships feel more strained and transactional than ever. The friction is real. And the client experience (CX) is suffering.  The uncomfortable truth is that this decline isn’t primarily caused by a lack of talent or a lack of care. Many PR agencies are filled with smart, committed people who want to do excellent work. The deeper problem is structural: public relations agencies—especially those operating inside large public holding companies—are increasingly optimized for quarterly performance, margin protection, and shareholder return. Best-in-class CX is one of the first things to erode when the operating system is built for earnings. 

PR Is a Client-Service Business — And That’s Why This Matters 

Public relations, and all marketing communications, is not a commodity. It’s not a factory line where you can produce “X deliverables” and reliably generate “Y reputation outcomes.” Yes, agencies produce outputs — press materials, media outreach, thought leadership, strategic content, social strategy, executive platforms, crisis plans, employee engagement. But what makes PR valuable is the ongoing relationship work that supports those outputs: strategic judgment, contextual awareness, emotional intelligence, and trust allowing an agency to advise a client not only on what to do, but on what not to do. It’s counsel that helps companies navigate ambiguity and reputational risk — and do it quickly.  That’s why PR is extremely sensitive to deteriorating client service. When client service breaks down, PR doesn’t just become less pleasant. It becomes less effective: 

• Pattern recognition across culture, media, and stakeholder behavior 

• High-context counsel grounded in deep understanding of the organization and its risks 

• Crisis readiness and the ability to respond with speed and calm 

• Trust, continuity, and strategic judgment built over time 

• Relationships — not just between agency and client, but with journalists, creators, analysts, and communities 

• Proactive idea generation and reputational offense (not just reputational defense) 

  
  

None of this thrives in a system designed to constantly reshuffle teams, optimize utilization, and extract margin. And that is increasingly the modern agency environment. 

Holding Companies Don’t “Try” to Break Client Service — Their Incentives Do 

Holding companies operate under the same pressures any publicly traded business faces: earnings expectations, shareholder demands, margin targets, and near-term growth narratives. But these pressures shape behavior — and behavior shapes CX.  In a holding-company context, the question isn’t whether leadership cares about client service. Most do. The question is what they are rewarded for. When “performance” is defined largely by margin and earnings, certain patterns become predictable – with senior talent being treated as an expense versus a differentiator to protect and with layoffs being the easiest lever to pull.    The challenge for PR is that client experience depends on senior continuity and deep knowledge — precisely the things that are hardest to scale and yet what we are seeing being cut around the globe at levels never seen before. When agencies are optimized for earnings and margin protection, client service degrades in familiar ways: 

• Senior leaders spread too thin across too many accounts 

• Turnover forcing clients to constantly re-onboard new team members 

• Reduced proactivity because teams are focused on throughput, not anticipation 

• Juniorization of day-to-day delivery and fewer experienced counselors in the room 

• Fragmentation across disciplines and internal handoffs that dilute accountability 

• More internal approvals and layers of management that slow responsiveness 

This isn’t because the people are worse. It’s because the operating conditions are worse — and PR is uniquely vulnerable to those conditions. 

The Reality Clients Experience: Instability and Service Debt 

Clients don’t always call it “CX deterioration.” They describe it plainly: 

• “We’re always onboarding new people.” 

• “Our team keeps turning over.” 

• “We don’t get proactive counsel anymore.” 

• “Everything feels reactive.” 

• “We used to have a senior leader who truly knew us.” 

• “We have to manage the agency instead of the agency managing the work.” 

In PR, these issues are operationally damaging. They create service debt — the accumulated loss of institutional knowledge, context, and trust that slowly makes the relationship harder and the work less effective. Service debt shows up when: 

• A client asks for counsel, and the agency responds with execution 

• A crisis hits and the agency lacks historical sensitivity and internal context 

• An executive needs coaching but the agency doesn’t know their voice or risk appetite 

• Media outreach becomes less precise because relationships aren’t maintained over time 

When clients stop trusting agencies to anticipate, they start micromanaging. When agencies feel micromanaged, they become defensive. The partnership becomes transactional — and performance declines. 

Why Friction Feels Worse Than Ever 

The client–agency environment contains more friction than at any point in recent memory, not because clients have become unreasonable, but because the complexity of the work has exploded and the big agency and holding company models are prioritizing elements that are working to undermine CX. 

WFA + MediaSense’s Future of Media Agency Models research found that just 11% of respondents believe their current agency model fits their future needs, and 24% believe it’s unfit for purpose - a direct signal of widespread dissatisfaction and misalignment. And when 75% of advertisers want to change how they pay agencies, what they’re really saying is, This partnership isn’t working as well as it used to.”  Clients operate in a reality where earned media competes with creators and platforms, reputation risk can trend globally in hours, stakeholders include employees and regulators, and measurement expectations are rising even when outcomes remain probabilistic. At the same time, agencies face tighter budgets, scope compression, and increasing demands for speed. Combine client complexity with agency margin pressure and friction becomes inevitable – ultimately identifying that a change in the agency model is needed.  

Restructures and Layoffs Aren’t Abstract — They Land on Client Teams 

The fastest way to degrade client service is to interrupt the people delivering it. The industry is in an era of consolidation and massive cost-cutting, and even when changes don’t directly target PR, they ripple into PR teams through shared services, centralization, leadership changes, and internal instability.  

Clients are signaling that the model is misaligned. 

You don’t need a single “client satisfaction index” to recognize what’s happening. Look at how advertisers discuss the agency ecosystem overall. A large share of advertisers want to change their agency compensation model — a signal that many clients believe the current model is misaligned with value, transparency, and outcomes. When client experience is strained, the relationship becomes less strategic. PR becomes more tactical. Work becomes safer. Outcomes become less differentiated. 

What Agencies Can Do 

PR agencies can still win on client service — even inside holding-company structures — if they treat CX as an operating discipline. The biggest mistake agencies make is treating client experience as something that happens “organically.” In reality, it needs to be designed, measured, and protected. Client service commitments that improve: 

• Most agencies assign a single accountable client owner responsible for the relationship end-to-end, this needs to continue 

• Protect team continuity as a service promise and measure it (e.g., 12–18 month targets) 

• Make proactivity a KPI 

• At a time when training programs have all been cut to the bone – prioritize investments in CX training programs; invoke it into your agency’s cultural ethos 

• Create a clear “fast lane” escalation path for urgent issues and crisis moments 

• Increase senior involvement where it matters most (counsel, crisis readiness, executive platforms, creativity) 

• Be transparent - about staffing, constraints, and tradeoffs before service break 

• Most importantly treat relationship health as a leading indicator of performance 

What Clients Can Do, Too (Because It’s Not One-Sided) 

Clients also shape the conditions for great marketing communications agency programs. The clients who get the best outcomes treat agencies as partners and advisors, not as commodity vendors: 

• Reward proactive counsel, not only fast execution 

• Align procurement with reputation and business outcomes (not purely rate targets) 

• Bring agencies into planning earlier to reduce last-minute emergencies 

• Clarify decision-making and approval paths so work doesn’t stall 

• Create space for strategic thinking, not only production 

Great agency CX requires a partnership structure. If the relationship is purely vendor-based, the work will eventually reflect that. 

The Agencies That Win Will Look More Like Advisors Again 

Holding companies aren’t going away. Earnings pressure isn’t going away either. Agencies that treat client experience as a competitive advantage — and protect the relationship as fiercely as they protect the work — will stand out dramatically.  In a world where agency relationships feel more strained than ever, the agency that makes the client feel taken care of will win. Not because that’s sentimental — but because, in PR, trust is the engine of the work.