The Entertainment Pivot: Why Agencies Are Trading “Work-for-Hire” for IP Ownership

The traditional advertising agency model is undergoing a radical, existential recalibration. After fifteen years of watching creativity be commoditized, optimized, and eventually automated by procurement-led processes, a new breed of agency leadership is pivoting toward a radical alternative: becoming entertainment companies.

This shift represents more than just a new service offering; it is a fundamental rejection of the “work-for-hire” paradigm. As agencies like Ralph, Elvis, and Small World navigate this transition, they are moving away from the role of service provider and toward the role of content owner, brand partner, and intellectual property (IP) developer.

The Death of the "Service Provider" Mindset

For over a decade, the agency business has been defined by the pursuit of scale and efficiency. This pursuit led to a "race to the bottom," where creativity was stripped of its soul to satisfy procurement departments focused on line-item costs. Chris Hassell, founder of the independent agency Ralph, argues that this path has hit a dead end.

“Entertainment is the one part of the creative business that cannot be procured, optimized, or automated,” Hassell notes. He argues that performance marketing, while effective for short-term conversion, cannot manufacture the cultural gravity of a hit show or a beloved brand franchise. According to Hassell, the industry has spent a decade making itself cheaper and more efficient, only to find itself staring at a haunting question: What is the agency actually for?

Ralph is now actively transforming itself from a legacy shop into a multi-faceted entertainment powerhouse. With a portfolio that includes a dedicated magazine, a podcast partnership with Time Out, a burgeoning TV channel, and a "Labs" division for IP incubation, Ralph is betting its future on “Fun Worth Finding.”

Chronology of the Shift

The move toward entertainment-first creativity did not happen overnight. The timeline of this evolution tracks closely with the rise of the creator economy and the decline of traditional television dominance.

• 2010: Chris Hassell launches Ralph with the mission to “make cool things.”
• 2021: Small World is founded by Dan Salkey and Harvey Austin, explicitly built on an “entertainment-first” creative philosophy.
• 2024–2025: The industry reaches a tipping point. As AI-generated content floods the market, agencies find that human-led, narrative-driven entertainment becomes the only true premium differentiator.
• Mid-2026: Agencies like Elvis formalize the shift by hiring dedicated "Heads of Entertainment," signaling that this is no longer a fringe strategy, but a structural necessity for growth.

Supporting Data: Why "Entertain First" Works

The evidence for the entertainment-first model is becoming difficult for even the most skeptical CMOs to ignore. When agencies stop producing "ads" and start producing "content," the engagement metrics shift significantly.

Small World’s work for Hot Topic provides a blueprint. Facing a disconnect with Gen Z, the retailer collaborated with the agency to form a writers’ room and produce a social-first sitcom. The results were quantifiable:

• 16% increase in store visits among viewers of the series.
• 12% increase in online purchase intent.
• 6% lift in brand affinity (perceived "coolness") compared to standard retail marketing.

These numbers illustrate a clear runway for the approach. When marketing functions as entertainment, the "sales cycle" shifts from an interruption to a destination. As the industry faces a future where YouTube daily viewing (99.1 minutes) has officially overtaken Netflix (93.4 minutes), the agencies that can capture that time through entertainment rather than traditional spots are the ones that will thrive.

Official Perspectives: The Agency Leadership View

The transition is fraught with internal friction. Agencies are often forced to balance their legacy revenue—the bread-and-butter work-for-hire—with the speculative, long-term investment required to build an entertainment brand.

Chris Hassell on the Commercial Model

Hassell is candid about the duality of his business. “If your business model is still aiming to be fee-based, you’re not really approaching it wholeheartedly,” he says. For Ralph, the commercial model relies on brand partnerships, direct subscriptions, and merchandising rather than simple hourly billing. The goal is to find "partner brands," not clients. "We are investing alongside them to make sure our approach is pure," he adds.

Claire Prince on Structural Evolution

At the London-based agency Elvis, the appointment of Claire Prince as head of entertainment was a direct response to a stark realization: "Staying as a traditional advertising agency means you’re just going to get smaller." Prince, who brings a background in TV development, is restructuring the agency to operate like a production house. This includes shifting the roster of partners from traditional ad-production firms like Stink or Pulse to entertainment giants like Banijay and Fremantle.

Implications: The Future of the Agency Landscape

The transition to an entertainment-first model has profound implications for every facet of the marketing ecosystem.

1. The Death of the "Chief AI Officer"

As James Chandler of IAB UK points out, specialized roles like the "Chief AI Officer" are likely transitional. AI will become a utility, not a strategy. The true competitive advantage will shift back to human-led creativity—the ability to build rights, talent relationships, and distribution networks that AI cannot replicate.

2. Procurement’s Looming Obsolescence

The biggest barrier to this new model is the existing procurement apparatus. Procurement departments are designed to compare apples to apples, making it difficult to price "value-based" entertainment assets. However, as Scott Spirit, chief growth officer at S4Capital, notes, the industry is moving toward "asset-based pricing." This model moves away from time-and-materials, focusing instead on the value of the asset itself. While procurement departments may push back, the market is forcing their hand.

3. The "Creator Collective" Challenge

The success of entertainment-led agencies is not without risks. As seen with the recent departure of high-profile creators from collectives like the Sidemen, businesses built on personality and IP are subject to the same pressures as tech startups. Issues regarding equity, succession planning, and IP ownership are becoming the new standard for creative agencies.

Conclusion: The New "Fun Worth Finding"

The advertising industry is at a crossroads. The era of optimizing for reach at the lowest possible cost has rendered much of modern marketing invisible. To survive, agencies must become the architects of culture rather than just the purveyors of messages.

Whether it is Ralph’s commitment to building its own media channels, or Small World’s commitment to writers’ rooms, the message is clear: consumers have never had more choice, and they are choosing to ignore advertising. They are not, however, ignoring entertainment. The agencies that can bridge that gap—by trading the security of a fee-based model for the risk and reward of IP ownership—will define the next decade of the creative economy.

For brands, the choice is equally binary: continue to fund campaigns that are skipped, or invest in the long-term equity of entertainment that the audience actually wants to spend time with. As Hassell puts it, the goal is "Fun Worth Finding." In a crowded digital landscape, that is the only metric that truly matters.