Dive summary: 

• According to research by the ANA, the number of agencies with some performance-based pay is on the rise; estimates are that 61% of agencies now include incentives in their contracts, up from 46% in 2010. 
• Incentives are much different that true pay-for-performance contracts which rest solely on results meaning the agencies in those contracts could take a loss if goals are reached. 
• Many agencies are already working on such a thin margin, working with pay-for-performance contracts could potentially ruin the firm; pay-for-performance contracts also inspire agencies to focus on low risk accounts which could stifle creativity and risk in the industry as a whole. 

From the article: 

"Clients themselves often back out of performance-related conversations when they realize they could be on the hook for an invoice that’s considerably larger than they envisaged after an overwhelmingly successful agency campaign or execution. They have fixed budgets and overheads, too, which rarely allow for that type of flexibility."