"Full-service agencies’ value proposition has been that they can execute a client’s message through every conceivable medium." This is not very accurate. "Full

"Full-service agencies’ value proposition has been that they can execute a client’s message through every conceivable medium." This is not very accurate. "Full-service" usually means that an agency both makes the ads and buys media to place them. There are many agencies that do only one or the other, and then there are subsets of each: digital-only shops, ideation-only shops, search-only shops and so on. "Full-service" is not a bad thing, at least in theory, because the fewer agencies you have working on different pieces of the same project, the smaller the chances that the result will be a watered-down compromise between competing organizations. The real reason why big agencies are big -- which is what I think OP is really arguing against -- and will stay big is scale. A national retail chain will produce thousands of banners a year, dozens of TV commercials with dozens of regional variations, hundreds of radio spots, thousands of catalog images and pieces of copy. A single unit of ad output may require input from dozens of people. The OP has an idealized model of the business that ad agencies are in, but creative ideation is only one line item in an advertising budget.