Independent digital agencies in India gain ground on the back of retainers, ROAS deals

India’s digital marketing landscape is undergoing a structural shift, and leading that change are the country’s fiercely independent digital agencies. Once seen as the underdogs in a field dominated by global networks, these nimble outfits are now carving a new growth path defined by agility, impact, and evolving client engagement models.

This momentum is reflected in the Pitch Madison Advertising Report (PMAR) 2025, which projects that India’s digital advertising sector will reach Rs 52,992 crore this year, a 17 per cent increase and account for 44 per cent of the total advertising market.

As digital platforms proliferate and consumer behaviour continues to shift online, independent agencies are riding this wave with growing confidence.

While there is no definitive count, industry estimates suggest that India now has over 1,000 digital-focused agencies, up from just about 50 in 2011. Collectively, they are commanding a significant share of this Rs 50,000 crore-plus market, which is expanding at double-digit rates and rapidly closing the gap with legacy media in overall ad spend.

Whether it’s through performance-linked engagements, hybrid contracts, or co-creation deals, independent agencies are no longer playing catch-up, they're in fact setting the pace.

Their financials from FY24 show a sector in recalibration - cutting losses, deepening client engagements, and testing ownership-led models.

Independent digital agencies in India are charting distinct financial trajectories as they scale, with recent filings reflecting both resilience and recalibration.

Financial fortunes

For instance, Grapes Digital has reported a revenue of Rs 70.6 crore and a net profit of Rs 3.14 crore in FY23.

Then there is Tonic Worldwide that clocked revenue in the range of Rs 45-50 Cr for FY 24-25.

Beneath the balance sheets lies a shift in the very DNA of independent agencies: how they engage, bill, and deliver for clients.

Hybrid engagement models emerge as the sweet spot for independent agencies

Beneath the balance sheets lies a shift in the very DNA of independent agencies: how they engage, bill, and deliver for clients.

Lets start with Grapes Worldwide. What they have done is, they have strategically flipped toward long-term structures.

“Roughly, 70% of our work is contract-based, and 30% is project-based,” said Shradha Agarwal, Co-founder & Global CEO.

“This strategic balance enables us to foster enduring relationships with brands while simultaneously retaining the agility needed to capitalise on unique, campaign-driven, or standalone opportunities.”

Agarwal further stated that their operational framework encompasses all three models (retainer/projectbased/hybrid), with the choice driven by the unique requirements of each mandate.

Retainers continue to work best because they help them create long-term brand value and manage integrated mandates across creative, media, and strategy. Project-based work also helps us, she said, to stay agile and explore newer categories or formats without long-term commitments. It opens an opportunity for future retainer relationships.

BrandStory, by contrast, thrives on a blended engagement model.

“Around 80% of our engagements are hybrid. We typically set a base retainer for consistent deliverables like social media or SEO, with add-on projects for product launches, influencer campaigns, or tech builds. This model provides financial predictability for us and flexibility for clients, especially in volatile markets,” said Bala Kumaran, founder and director.

BrandStory has 65-70% of clients on a project basis, which aligns with how most clients prefer to test agency capabilities through campaign launches, digital revamps, or short-term performance mandates before entering long-term commitments. It also allows them to stay agile and responsive to evolving brand needs.

White Rivers Media also sees the hybrid model as an essential element to staying relevant.

“Independent agencies in India are increasingly favoured for project-based work, driven by the demand for agility and specialised expertise. While retainers remain common, especially for ongoing digital and content needs, the hybrid model blending both retainers and project assignments, has emerged as the most effective strategy,” said Viren Vesuwala, lead, strategic partnerships.

This approach enables agencies to provide both consistent support and precise, campaign-driven solutions with
equal impact.”

Holding on to clients

Alongside shifting financials, independent digital agencies are also recalibrating their client engagement models - most notably in how they structure retainers. “Our retainer clients have remained quite robust, and we've certainly seen them expand over the past twelve months,” said Agarwal, adding that this growth, they believe, clearly demonstrates increased confidence in their expertise and the lasting value they create through enduring collaborations.

BrandStory has also seen a rise in retainership clients. According to Kumaran, retainer clients increased by around 20% in 2024, though the scope of these retainers has evolved. “Instead of blanket mandates, retainers are now more focused on continuous optimisation—SEO, CRM, content cycles, and social media management are common areas of ongoing engagement.”

However, there’s also a larger problem at play - the rise of short-term, project-based engagements signals a deeper shift in client-agency dynamics, underscoring a broader erosion of brand loyalty. As clients prioritise agility, many are stepping away from long-term commitments in favour of flexible, outcome-focused collaborations.

As Agarwal said, “This market currently demands agility, and brands are becoming increasingly cautious about locking themselves into long-term contracts. The market now demands that clients shift directions quickly, explore collaborations with different partners, and evaluate outcomes often. For agencies, this situation might lead to more project work, yet it undeniably requires them to consistently validate their worth to preserve ongoing engagements.”

At BrandStory, around 60% of clients now prefer 3–6 month retainers, typically framed around performance metrics and built-in exit clauses. There’s growing hesitation around 12-month or longer contracts unless the engagement involves significant complexity - such as CRM overhauls, marketplace integrations, or international rollouts—where extended timelines are essential.

Rise of performance-linked engagements, co-creation models

In an outcome-obsessed market, performance-linked contracts are becoming more mainstream.

“About 20% of our revenue now comes from campaigns with Return on Ad Spends (ROAS) guarantees or pay after-results structures,” said Kumaran. BrandStory is also seeing an increase in co-creation models, with brands increasingly embedding their teams as fractional CMOs, especially in early-stage D2C setups.

Agarwal reiterated this and said that for Grapes too, performance linked engagements and co-creation models have gained ground. “Performance linked engagements offer a clear, results driven approach where both sides are equally invested in the outcome. It is not just about delivering work but about delivering impact. That kind of alignment builds trust and long term value,” she said.

At White Rivers, co-creation is changing the game. “Co-creation is transforming partnerships, with agencies and brands collaborating closely to design campaigns that truly resonate,” said Vesuwala. The agency is also exploring equity-based deals with startups, where marketing services are partially offset in exchange for ownership.

On the other hand, both BrandStory and Grapes agreed that equity based deals are still niche.

Agarwal explained why these tend to be more complex, “While the idea is appealing on paper, the reality often involves legal, financial, and strategic hurdles that not all clients or agencies are prepared to navigate.”

For BrandStory, equity-based deals are still niche, but growing. They’ve had exploratory discussions with startups
looking to exchange equity for reduced upfront fees or strategic brand building.

Why Independence is the edge

Despite the perception that global network agencies offer scale and security, boutique agencies are turning their independence into a strategic advantage.

“Unlike larger networks, we can quickly adjust strategies and explore new tools, ensuring creative and measurable outcomes without being held back by outdated systems,” said Vesuwala. He added that while some clients are drawn to the global reach of network agencies, many now value the transparency, innovation, and close collaboration that independents offer. White Rivers positions its AI-first approach and rapid adoption of emerging tools as its edge.

Kumaran said, “At BrandStory, we can pivot campaigns in 48 hours. There’s no bureaucracy—clients speak to leadership, and strategy is deeply embedded in execution.” Cost efficiency—as much as 30–50% lower than networks—is another draw.

Grapes, meanwhile, believes the real differentiator is accountability and customisation. “We generally don't view large agencies as our direct competition. Frankly, the market is broad enough for diverse players. There are times when our work doesn't overlap in the slightest. However, in specific instances, they absolutely are competitive, particularly when engaging with large multinational corporations that often gravitate towards the reassurance and sheer reach offered by global networks,” said Agarwal.

According to her, they’ve seen hesitation from such clients at times, especially when mandates involve international markets or require global alignment. However, what works in their favour is the growing number of brands that are looking for real partnerships where there is skin in the game, more direct involvement, and a team that treats the business like their own.

From their financial rebounds to experimental contracts and creative flexibility, India’s independent digital agencies are not just filling the gaps left by networks—they’re leapfrogging the system. By evolving client models, betting on co-ownership, and prioritising outcomes over outputs, they are building not just sustainable businesses, but resilient ecosystems.