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We live in an era where AI makes everything appear faster.
A client sees ChatGPT generate a paragraph in five seconds and wonders: “Why can’t my agency deliver in half the time, too?”
Under the traditional agency pricing model (time for money), this becomes a constant tension. Agencies bill by the hour, clients question every estimate, and both sides stare at the proverbial meter. It’s like taking a taxi and staring down a rising fare instead of enjoying the view.
For years, I knew the traditional services pricing model was broken. It rewarded slowness, not results. It made clients suspicious of every invoice and forced teams to justify every hour instead of every outcome. Most of all, it put the engagement risk on our clients instead of our agency, which always felt backwards to me.
The real turning point came at the SoDA Global Member Conference in September 2024 in Copenhagen, when Caroline Johnson from the Business Model Company delivered a keynote on the cracks in the agency model and what to do about them. Her talk was a wake-up call. I’d been feeling the same frustration for years, but hearing it articulated on stage, to a room full of founders and operators, made it undeniable.
That night, our team committed to rebuilding Verbal+Visual from its first principles. What we wanted was the Uber experience for professional services: a clear, predictable pricing structure, agreed upon by all parties before the ride begins. We’re driving, and clients can sit back, enjoy the scenery, and arrive at their destination without worrying about where they are going and how much it will actually cost.
Productizing intelligence, not hours
Following months of planning work with external advisors and our internal leadership team, we came to a simple conclusion: traditional agencies sell services; the next generation will sell intelligence. From that premise, we created and launched Commerce+, a productized, outcome-based, flat-rate model designed to deliver commerce growth predictably.
Here’s how it works. Instead of billing hours based on discrete services and tasks, we sell programs consisting of pre-defined products that bundle strategy, design, technology, and optimization into transparent, fixed-price engagements. Each product is defined not by a scope document, but by KPIs and deliverables. In other words, we’re defining concrete outputs and outcomes instead of tasks and hours.
This new approach to flat-rate, programmatic pricing shifts risk and uncertainty from the client to our agency. And that pressure is a healthy performance incentive for our teams. It forces us to deliver quality and speed (top talent only), to be flexible to fluctuations in demand (freelance talent model), and to use AI and automation intelligently (faster, more repeatable processes). It also requires that we systemize and continually refine our systems so that we can predictably deliver against defined outcomes.
In aggregate, this structure forces us to compete on value, efficiency and outcomes rather than on proliferating services and lower hourly rates. Put simply, if we’re efficient and effective, we win. If we’re sloppy, we lose.
Early wins and honest lessons
Since launching Commerce+, the market response has been positive. The simplicity of a flat rate pricing structure, the transparency of defined outcomes, and the ability to forecast spend have created comfort and trust with clients and new prospects while also enabling us to differentiate our offering from a sea of competitors in the commerce space.
On the flip side, we’ve also learned that our initial approach was far from perfect. Some clients found the bundled program model to be, “too much on the menu” and they faced decision paralysis on which option(s) would be best for them. In other cases, clients didn’t understand what each product contained, what was in-scope or not, and how flexible the system might be for their unique needs.
There is no doubt that these questions cost us a few deals we might have otherwise won. But the feedback has also proven crucial and helped us understand that the next evolution of this offering isn’t more complexity, it’s more clarity.
Our goal to make outcomes (e.g., KPI achievements) instead of hours the new currency for success has proven to be a fruitful first step in restructuring the way we operate and how we go to market. We now look more comprehensively at “success” by what actually changes in the client’s business (i.e., conversion rates, average order value, speed to launch, customer retention, etc.) and not just whether a project was delivered on-time and on-budget. We’ve also seen that once you remove the stopwatch, teams focus on quality. We’re incentivized to collaborate more freely, make smarter decisions, and push for speed and impact instead of just motion. Through this lens, AI is embraced as a creative accelerant rather than feared as a margin threat. These changes in mindset, behavior and structure alone have energized our team and provided an optimistic vision for what the agency of the future can become.
In terms of concrete operating metrics, our shift to a productized pricing model and outcome-based programs has helped fuel an increase in our new business win rate from ~21% to ~45% for SQL’s. That, of course, is a promising sign. While our project margins have declined around 7%, we view this as an expected and short-term cost for learning and adapting to a new way of working. We’re pleased with the progress we’ve made and expect that operating margins will improve and exceed our old model in year two of Commerce+.
Get started or lose the way
The fundamental economics of the agency business are changing and it seems clear that AI-technology adds fuel to the fire. In fact, data from SoDA’s 2026 Agency Outlook Study shows that 51% of agencies say that increased competition has negatively impacted their pricing power, 43% report shrinking profit margins, and 60% are actively re-evaluating their core business model.
At Verbal+Visual, we’ve felt an urgency to act and have had to shed some of our old beliefs and ways of working to begin finding our path to a new model. Our approach to Commerce+ is grounded in our specific expertise, what we love to do, and our vision of what we want to become. But these are just the initial steps in a new journey. No doubt, there is much to learn and unknown adversity ahead. The important thing is that we’ve decided to leave what was an old, familiar home for what we see as promising new territory in the direction of productization, subscription models, and outcome-based pricing. Our approach won’t be right for everyone and there are a million permutations on these ideas. The differences will manifest in how clearly agencies can tie their value proposition and operating model to client results and how quickly and intelligently they evolve it over time. The path ahead may be unclear. But the time to get moving is now.
