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Media agency holding company CEOs are openly acknowledging the importance of arbitrage-based principal trading to their business models – and it’s spreading rapidly out of digital display into TV, audio, digital out of home, connected TV and beyond. Former UM Global Chief Media Officer Joshua Lowcock, who left the IPG-owned media agency network last year to head up media at US group Quad, is bleak on the distorting market effects of holding companies buying media for themselves and on-selling to advertiser clients with handsome mark-ups – often in ‘bundled’ products which blend a small quota of quality inventory with low value tonnage. “Both agencies and clients have built themselves a prison that they can’t get out of,” says Lowcock, adding that holdcos are hiding “boatloads of cash” within the “myriad complexity” of their structures – and that rank and file staffers don’t even know they are doing it. He thinks a client-driven “ugly” reckoning is coming that will pull down the principal media house of cards – and has the five questions procurement, marketing, finance, legal and compliance should be asking. But evidence so far suggests that day may be some way off. Ex-GroupM exec Dave Gaines, now CEO at Media by Mother, says retail media is making the situation worse – but also that media owners complaining of getting squeezed are likewise reluctant to apply margin-sapping sales resource to direct client deals. Either way, few owners will complain publicly for fear of retribution, i.e. being cut out of group spend, per Nick Manning, non-executive chairman of Media Marketing Compliance and adviser to peak US advertiser body the ANA. Manning sees principal media’s rise leading holdcos to becoming just the same as the walled gardens whose “black box” business models they are trying to emulate, a “zero sum game”. But for those that care, here are the fixes.

Cracking America is the mark of any great brand. Leigh Barnes, Americas President and Chief Customer Officer at global Australian travel firm Intrepid is relocating his family – literally today – to Seattle, home of grunge, and walking a tightrope as a DEI, purpose-driven B Corp business in the age of Maga corporate. He’s getting “slapped around the head” a little and is working through what adjustments he may need to make in a sensitive political environment. Still, Intrepid in the US is cutting a contrarian brand-powered swathe through the performance-driven marketing echelons and it’s working. Organic search is through the roof as a “cocktail” of traditional above-the-line brand advertising and PR storytelling rapidly moves the needle, though AI chatbots may have a hand. Direct business is working so well that Barnes must now build out US partnerships akin to its early ANZ work with Flight Centre or risk over-reliance on fickle online platform gatekeepers. But, to the chagrin of “Russian bot farms”. he’s confident Intrepid will soon be a billion dollar company.

Brands will soon be confronted with a choice: Employ AI to make cheaper, more plentiful ad creative so you can keep chasing a prospect with iterative messaging until they finally click yes, or risk pissing off said consumer while doing it, says The Coca-Cola Company’s chairman and CEO, James Quincey. Speaking today at this year’s Adobe Summit, the beverage giant chief has no immediate plans to remove the real humans from its advertising, even after attaining cost and efficiency gains from its first generative AI-made holiday campaign at Christmas. But he admits the enticement of cheaper, faster, infinitely more personalised campaign creative at scale using AI is a lure most marketers are going to be hard pressed not to swallow – and that could prove seriously problematic. The last great hope? Live events.