Principal Media Is Changing the Agency Model—Whether We Like It or Not

Principal media buying has moved from a quiet industry practice to a very public flashpoint. 

While much of the current discussion focuses on digital and programmatic channels, principal media spans the full media ecosystem, from traditional linear channels to programmatic marketplaces.

The practice has long existed across traditional media—broadcast, cable, radio, and outdoor—where agencies could leverage scale to secure and resell inventory. What’s changed is not the existence of principal buying, but its scale, complexity, and the degree to which it now sits at the center of agency economics.

This is an extremely sensitive topic, but the recent surge in reporting, coupled with broader industry tension, makes it clear: this once-niche practice is reshaping the economics and the trust dynamics of our business.

The case for principal media

Those that support principal media largely point to cost efficiency. And that is, in many cases, true. Some marketers may see 10%–15% savings versus open-market buying.

But the advantage runs deeper than that.

When price becomes disproportionately weighted in an agency review, those agencies with scaled principal media practices have a structural edge. 

Not just because they can offer lower pricing, but because the profits generated through principal media can subsidize other services—sometimes significantly. It’s not uncommon to see teams provided at no charge for a period as part of a broader commercial arrangement.

In this environment, clients seeking cost extraction as a primary goal will naturally gravitate toward agencies with scaled principal offerings.

There’s also a second-order benefit. The profits generated through principal media can be reinvested into capabilities—whether through acquisitions or in-house development—that strengthen an agency’s competitive position. 

Consider the scale of investment some holding companies are now making in AI and data infrastructure. Those investments are not happening in a vacuum.

The case against principal media

The concerns around principal media are well-documented and deeply interconnected.

The most visible issue is lack of transparency, due to hidden fees, undisclosed margins, and opaque pricing structures.

While some agencies disclose their margins on principal media, many do not—unless explicitly required by contract. According to the ANA, only 57% of marketers have governance rules in place around this practice.

I saw this firsthand. During the onboarding of a major retail client, we discovered their media flowcharts showed only aggregate costs—no partner-level detail. When pressed, the incumbent agency declined to disclose rates, arguing they “belonged to the agency.”

The issue quickly becomes a conflict of interest. 

Agencies are no longer purely incentivized to act in the client’s best interest—they are also incentivized to maximize their own margin. That can mean prioritizing inventory they own or deals that carry higher spreads, rather than what may perform best.

And when pricing is opaque and incentives are unclear, trust erodes.

Agencies rarely lose clients over pricing. They lose them over trust.

It deepens tension in the agency-client relationship

These issues are symptoms of a larger structural shift.

For years, clients have pushed for lower costs—both in media and in agency fees. 

Procurement has taken a more prominent role in decision-making, often with a mandate to deliver savings. Consultants frequently reinforce this dynamic, leading with cost guarantees rather than growth.

Even though principal media can deliver both cost efficiency and performance, it fundamentally alters the agency-client relationship.

Agencies were traditionally positioned as trusted intermediaries—acting on behalf of their clients. Principal media shifts that role. Agencies become market participants, with financial exposure and competing incentives.

You can’t be both a fiduciary and a counterpart in the same transaction without introducing tension.

A former colleague of mine, now on the client side, ran a global media review. 

Three of the four consultants competing for the assignment focused heavily on savings. Only one focused on strategy and topline growth. That’s the one she hired—but the broader trend is clear.

In this environment, agencies have been forced to find new revenue models. And at the same time, clients increasingly expect outcomes, not process.

How to move forward when outcomes are paramount

Principal media is not going away. In fact, it is likely to accelerate. The economic pressures that drive it exist across all channels.

Even smaller, independent agencies are now establishing their own principal practices. But what’s interesting is that many of these independents are taking a different approach:

• Disclosing margins
• Requiring opt-in rather than opt-out
• Comparing buys with and without principal media

That may signal where the model evolves next—not away from principal media, but toward greater transparency and client control.

At the same time, the clients need to shift their thinking.

An emphasis on cost extraction is a race to the bottom. Agencies can always find cheaper media. The more important question is what that media actually delivers.

Does it command attention?

Does it place brands in environments that enhance perception?

Does it drive meaningful business outcomes?

Because better media builds better brands.