Tom Cumberworth, GM of Media, Innocean
There is a predictable rhythm to the media industry’s existential crises. This week, the drums are beating again over Principal-Based Media.
Recent commentary suggests that bundled media (packages of mixed inventory sold by holding companies) is a bigger problem than principal-based trading because of its opacity in measurement. It’s a valid technical point, but it feels like arguing over which deck chair on the Titanic has a better view of the iceberg.
As an industry, we are getting pulled into a procurement war over the plumbing of transactions, while completely ignoring the creativity required to actually move human beings.
The issue isn’t just about whether an agency owns the inventory (Principal) or obscures it in a group deal (Bundled).
The problem is that both models are symptoms of a broken incentive structure. They both result in media planning that is engineered to satisfy the agency’s commercial commitments rather than the client’s business problems.
When you strip away the jargon, the current debate reveals three uncomfortable truths about our industry that no amount of spot-level data can fix.
Transparency is about Intent, not just invoices
The defence of Principal Media often hinges on the idea that if the agency takes the risk, they deserve the margin. Critics, like Nick Manning, rightly point out that this turns agencies into vendors, prioritising the sale of their own inventory over agnostic advice.
But Bundled Media is just the same wolf in sheep’s clothing. Whether you are selling inventory you own, or inventory you have committed millions of dollars to in a volume deal, the result is the same: Bias.
You cannot be fearless in your media recommendations if there are profit incentives tied to investments in specific partners.
We know that 87% of brands believe agencies are resistant to models that require greater transparency. But true transparency isn’t just about seeing the net cost; it’s about understanding the motivation behind the plan.
If your media agency has a financial stake in where the money goes, they are no longer an agent; they are a salesperson. We believe in being truly agnostic, no reliance on preferred partners, no hidden kickbacks, and no agendas. If we recommend a channel, it’s because it solves the business problem, not because it clears our ledger. As a full-service agency, our recommendation may also outline no paid media spend at all! When profit is tied to increased media spend, more media spend is very likely what will be served up.
The outcome illusion
The industry defence for these opaque models is often that they deliver improved outcomes and guaranteed pricing. But we need to ask: what outcomes are we actually chasing?
We have allowed tech platforms to define performance in ways that suit their ecosystems. They sell us efficiency, cheaper CPMs, higher click-through rates, and automated optimisation.
Agencies love these metrics because they are easy to report and easy to fulfil via programmatic pipes (bundled, principal or otherwise).
But efficiency is not effectiveness.
We see a landscape where marketers and agencies estimate that 33% of budgets are wasted on misdirected work. Why? Because we are optimising for the algorithm’s happiness, not the brand’s health. We are chasing media outcomes rather than business outcomes tied to our clients’ longer-term success.
A media plan filled with cheap, low-attention inventory might look great on a procurement spreadsheet, but if it doesn’t command attention, it’s worthless.
The creativity deficit
Perhaps the most glaring omission in the Principal Media argument is the creative product’s role.
We are so obsessed with the efficiency of the delivery mechanism that we’ve forgotten the value of the payload. The data is irrefutable: creative quality is the single most incredible multiplier of advertising ROI, capable of generating 12x more effectiveness. Creative and effective ads generate more than four times as much profit.
Yet, in the traditional agency structures, media is handled by people who are often walled off from the creative process. They are incentivised to find the cheapest route to the eyeball, not the most impactful context for the idea.
The truth is, you cannot solve today’s complex problems with yesterday’s siloed thinking. We hire media talent and turn them into communication specialists who understand the power of ideas. We don’t just place media, we engineer it to be unignorable.
When one of a media agency’s key profit centres is arbitrage (reselling inventory), they have no financial incentive to care about the creative strategy, and that’s a death sentence for brand distinction.
The way forward: Fearless and agnostic
The industry doesn’t need a better way to hide margins; it requires a knock-down rebuild.
Clients are increasingly dissatisfied with the lack of flexibility and alignment with business results. They don’t want a black box of bundled inventory, nor do they want their agency acting as a principal vendor.
They want a partner who can: Diagnose the real business challenge, not just the media challenge.
Integrate creative and media so that every placement makes the idea more powerful.
Operate with radical transparency, providing unrestricted access to the entire media landscape without favour.
The “Bundled vs. Principal” debate is a distraction from the real work. It’s a squabble over how to slice up a shrinking pie. If we want to grow the pie, for our clients and ourselves, we need to stop acting like banks and brokers and start acting like fearless creative partners.
Let’s stop arguing about the plumbing and start focusing on the work.