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When “The Market” Becomes a Crutch

When “The Market” Becomes a Crutch

Reality Check #1: Growth Isn’t Tied to the Economy. It’s Tied to What Firms Do.

This is the first in our 5-part series around our 2026 New Year Outlook Report.  (Download it here.)

Let me get this out of the way first. Yes, growth is influenced by the economy. So is uncertainty, inflation, political volatility, and cautious client spending.

All of these factors affect business development. And this is typically when “the market” becomes a crutch. (You could just as easily substitute inflation, budget pressure, or economic uncertainty in its place.)

But if you’re not driving new business, or doing anything meaningful to support it, you can only blame the economy for so long.

That is the truth behind our first 2026 Reality Check.

The economy explains pressure. It does not explain inaction.

In our newly released 2026 RSW/US New Year Outlook Report, agencies and professional services firms once again point to familiar challenges heading into the year ahead: economic uncertainty, client caution, budget pressure, confusion around AI, and increased competition from firms chasing smaller budgets.

None of that is surprising.

What is more telling is what happens when you look past the headlines and into our report data.

Across the last three years, agency growth has been remarkably consistent, and consistently modest.

In 2023, 38 percent of agencies reported growth.

In 2024, that number was 44 percent.

In 2025, it edged up a bit to 39 percent .

Different economic conditions, different narratives, but nearly identical outcomes.

That consistency suggests agency growth has not moved, and does not move, in lockstep with the economy.

It has stayed largely flat regardless of it.

When “The Market” Becomes a Crutch

Client Expectations Are Shifting. Agency Outcomes Are Not

Now let’s look at how clients have been thinking about growth over the last 3 years.

Client growth expectations have moved sharply over the past few years.

Heading into 2023, only 39 percent of clients expected positive growth compared to the prior year, reflecting widespread uncertainty and caution at the time.

Going into 2024, 75 percent of clients anticipated positive growth compared to 2023, driven in part by stabilization after a difficult period and a belief that conditions were improving.

And finally, when clients looked to 2025 in comparison to the previous year, expectations moderated again, with 60 percent of clients expecting solid growth.

What matters most is not whether clients are optimistic or cautious in any given year, it’s that their expectations move with economic cycles.

Agency outcomes, by contrast, have remained remarkably consistent over the same period, regardless of shifts in client sentiment or broader economic conditions.

That contrast reinforces a key point behind this Reality Check.

Client expectations are shaped by the market.

Agency growth is shaped far more by what firms choose to do about business development, visibility, and positioning when those expectations rise or fall.

Optimism exists. Investment does not always follow

There’s also an important distinction between expectations and behavior.

Looking ahead to 2026, 69 percent of agencies expect improvement in their business performance, a meaningful increase from the prior year.

Confidence is creeping back.

But when it comes to investment, the story changes.

Only 46 percent of agencies expect to invest somewhat or heavily in their business this year.

On the client side, that number drops to 37 percent .

Marketing spend expectations are even more cautious. Just 25 percent of clients expect their marketing spending to increase in 2026, down from prior years.

This is where many firms drop the ball.

They want growth but they hesitate to invest in the very activities that make growth more likely.

Waiting, Assuming, and Hoping Are Not Growth Strategies

The data reinforces that these are not successful strategies for growth:

  • waiting for the economy to turn
  • assuming referrals will rebound on their own
  • hoping clients suddenly become less cautious

The firms that outperform in environments like this,

  • Stay visible when other firms pull back.
  • Stay proactive about business development instead of reactive.
  • Make it easier for prospects to find them, understand them, and engage with them.

Outsourcing growth is a successful strategy to combat marketing conditions (shameless plug for RSW).

Outsourcing stagnation to combat marketing conditions is no strategy at all.

Reality Check #1

Growth is not disconnected from the economy. But it’s not dictated by it either.

What ultimately separates firms that grow from those that stall is what they do when conditions are uncertain.

Do they reinforce their messaging clarity or wait it out.
Do they invest in discoverability or retreat into existing relationships.
Do they treat new business as an ongoing function or something to revisit when things feel easier.

The economy sets the context. Your actions determine the outcome.

This is the first of our 2026 Reality Checks, and it sets the tone for what comes next.

Growth is still happening and opportunity still exists.

The question is whether firms are positioned to capture it.

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