Why D2C brands actually fire their agencies

Where this data comes from — and its limits

Our free Growth Audit form asks brands that are switching one open question: why? Over the past year-plus, that has produced hundreds of written answers from Indian D2C founders — mostly food, FMCG, nutrition and consumer goods, mostly between ₹1L and ₹50L/month in ad spend. We tagged the free-text answers and ranked the themes. The field is optional, which makes the answers better: the founders who fill it want to be understood, and they write in detail.

Two honest caveats. The sample self-selects for unhappy brands — nobody fills an audit form to praise their agency — and the shares below are rounded from hand-tagged text, not a survey instrument. Directionally, though, the ranking has been stable for over a year, which is what makes it worth publishing.

The reasons, ranked

Here is the pattern, with what each answer usually turns out to mean once we open the account:

Numbers are rounded and overlap — founders often list two or three of these in one answer.

“We can't tell what's working” — the number one answer

The single most common phrase in the form is some version of “we get reports but we don’t understand our own account”. Sometimes that is a dashboard problem: vanity metrics, blended numbers, no contribution-margin view. Sometimes tracking is genuinely broken and the agency has been optimising on noise. Either way, the founder’s trust dies the same death — slowly, then all at once at a quarterly review. By the time a founder types it into a form, the relationship is usually past saving — the practical argument for demanding transparent reporting in week one, not month six.

The fix is structural, not cosmetic: reporting that starts from contribution margin and cohorts, with platform numbers reconciled against the bank account monthly. Our CMO agency evaluation checklist shows what that reporting standard looks like before you sign, which is the cheapest time to demand it.

The plateau: why accounts stall after month four

The second-largest group scaled well for a quarter and then flat-lined. The pattern inside these accounts is remarkably consistent: the early wins came from structure — consolidating fragmented campaigns, fixing tracking, killing losers — and once structure was fixed, creative volume became the binding constraint. Spend kept rising against the same five hooks, CPMs and CAC followed, and the agency answered with budget mechanics instead of new angles.

Plateaus around ₹10–50L/month are usually a creative-throughput problem, not a media-buying problem. We wrote up the specific mechanics in scaling past ₹50L monthly ad spend — the short version is that testing cadence has to scale with spend, and at most agencies it doesn’t. The uncomfortable corollary: if your account has plateaued, audit the creative pipeline before you audit the agency.

The bait-and-switch team, and the ROAS-vs-reality gap

Two more themes deserve naming. First, the bait-and-switch: the founder met sharp senior people during the pitch and never saw them again after signing. This is pod economics — senior time is spread across too many accounts — and the only defence is asking, before signing, exactly who works your account day to day and for how many hours.

Second, the reality gap: platform ROAS says 4×, the P&L says otherwise. In food and FMCG this is almost always COD returns, RTO and platform over-attribution stacking up — the maths is in COD, returns and real ROAS. Founders rarely leave over one bad month; they leave when the numbers stop reconciling and nobody at the agency seems bothered.

When switching is the wrong move

A meaningful share of the audits behind this data end with us saying: your agency is not the problem. If contribution margin is negative at the product level, if the offer has stopped converting, or if tracking is broken upstream of everyone, a new agency inherits the same wall — plus 6–10 weeks of relearning your account. Switching has a real cost, and paying it to solve the wrong problem is the most expensive mistake in this dataset.

Before you decide, pressure-test the decision against when to fire your marketing agency — and if the real question is whether to bring it in-house, that trade-off has its own maths. Sometimes the best outcome of an audit is a repaired relationship with the agency you already have.

How to switch without torching performance

If the decision is made, protect the transition:

• Own everything first — ad accounts, pixels, catalogues, analytics and the creative library must live on your business assets, not the agency’s.
• Document what worked: winning creatives, audiences, offers and the numbers behind them.
• Run a two-week overlap if the relationship allows it; a cold cutover costs more than the awkwardness.
• Give the new partner a 90-day brief with explicit success metrics — including the reporting standard whose absence made you leave.
• Do not let anyone rebuild from scratch on day one; structure changes should be earned by data, not by newness.

Handled this way, a switch costs weeks, not quarters — and the reporting standard you write into the new engagement is the best predictor of whether you will be filling in a form like ours again next year.