Research
The 2026 numbers show a crowded, fragmented agency market where most firms say their growth engine is too weak and most believe they are differentiated.
The Agency Demand System collected the published statistics most useful to small agency owners, each with its source. Read together, they make the case for DemandOS: when 71,000 agencies compete and most look alike, clear positioning and more people creating demand are what separate the growing ones.
Last updated: November 2026
Promethean Research counts more than 71,000 digital agencies in North America in 2026, up from 50,000 in its 2024 checks, and more than 200,000 globally. The North American count has grown at a 12% compound annual growth rate since 2018.
Most of them are small. 87% of the agencies Promethean evaluated had fewer than 50 full-time employees, which is exactly the size range this site is written for.
Market size
Growth and margin
Positioning
How The Agency Demand System reads each finding, and which part of DemandOS responds to it.
| Finding | Source | What it suggests | DemandOS layer |
|---|---|---|---|
| 71k+ agencies in North America | Promethean Research | Buyers have many look-alike options | Positioning |
| 75%+ call the industry undifferentiated | RSW/US 2026 | Sameness is the default, not the exception | Positioning |
| 85%+ positioned entirely in-house | RSW/US 2026 | Few agencies test their message with prospects | Positioning |
| 93% say growth engine is too weak | RSW/US 2025 via Haus Advisors | Founder-plus-referrals engines run out | Whole-team demand |
| 13% average net margin | Haus Advisors | Little room for expensive, low-odds new business | Positioning and expansion |
Tim Kilroy curates more industry research, with his take on each report, at the Agency Research Hub. To see how the system responds to these numbers, start with the agency positioning system or the agency demand system overview.
Short answers to the questions agency owners ask most. The full list of 48 lives on the agency demand system FAQ.
Promethean Research reports more than 71,000 digital agencies in North America in 2026, up from 50,000 in its 2024 checks, and more than 200,000 globally. The industry has grown at a 12% compound annual growth rate since 2018, which means more agencies competing for the same buyers.
See this answer in the FAQRSW/US's 2026 positioning survey found over 75% of agencies call the industry somewhat or very undifferentiated, yet more than 80% say their own firm is differentiated. Over 85% built their positioning entirely in-house with no outside perspective or prospect testing. That gap is the problem a positioning system solves.
See this answer in the FAQHaus Advisors reports the average digital agency earned a 13% after-tax net margin in 2025, down from a long-run average of about 15% since 2015. Thin margins are why Tim Kilroy stresses higher-value positioning and expansion revenue over chasing more low-priced new logos.
See this answer in the FAQThere is no single official list, and people split agencies by service type in many ways. For growth decisions, Tim Kilroy uses three zones: the Structured Zone under $50K a month, the Graduation Zone from $50K a month to $1M a year, and the Custom Zone from $1M to $20M a year.
See this answer in the FAQA demand generation agency is a firm that helps other businesses, usually B2B, build awareness and interest before buyers are ready to purchase, then turn that interest into pipeline. DemandOS is different: it is not an outsourced agency. It is a system Tim Kilroy installs inside your agency so your own team creates the demand.
See this answer in the FAQTim Kilroy publishes free, in-depth playbooks on his main website. These three pair best with DemandOS.
Published by Tim Kilroy
