Sector experience is an advantage and a risk at the same time, and which of the two dominates depends on one question: do the rules drive the work, or does differentiation?
Where sector experience wins
When the sector has its own legislation, procedures or jargon. Pharma, financial services, public procurement, food: there a generalist spends months learning what is allowed, and you pay for those months. An agency that knows the rules gets to the work itself faster.
Where sector experience loses
When you want to stand out. An agency already serving five players in your market knows that market's conventions and has applied them five times. That is exactly what you do not want when you are trying to be different from those five.
There is a second reason to hesitate: conflicts of interest. An agency serving your direct competitor usually cannot take your assignment, and if it does anyway, that is worth a conversation about who sees what internally.
The practical middle ground
Ask for experience with the audience rather than the industry. An agency strong at convincing technical buyers is as useful in machinery as in software. Audience knowledge travels; industry knowledge often stops at vocabulary.
How to find them
The factsheets show the stated sector focus per agency, and you can browse by sector. There is also a crossing of sector and expertise, so you can ask for "digital agencies with retail experience" instead of one or the other.
Do not look only at the list of sectors but at the reference clients below it, and ask in the meeting when that relationship ran. A sector reference from seven years ago with a team that has since left is a name, not experience.
See also: how to know whether an agency has experience in your sector and do you need a specialist agency for B2B, pharma, retail or public sector.