Agencies Can’t Price AI. You Still Pay.
Holding companies are folding AI compute into principal media deals, and Omnicom’s CEO says the market has not yet seen what AI costs. Your SOW has no line for it.
On July 29, Omnicom CEO John Wren said "the marketplace hasn’t seen what the cost of this AI is." Two months later there is still no billing standard: PMG caps tokens at $50 per employee per day, and some holding companies cover the tokens in exchange for a share of your media.
Greetings from New York.
Here is the shift: agency economics are moving from hours to tokens, and the cost of production is migrating into media. Digiday reported in July that holding companies are asking clients to route a fixed share of spend through agency-owned principal media in exchange for the agency absorbing AI infrastructure. One deal it described carried zero fees. Goldman Sachs forecasts token consumption rising 24-fold between 2026 and 2030. Coca-Cola’s Christmas ad took 70,000 prompts.
The consensus reading says AI makes agencies cheaper and the savings reach you. S4 Capital says otherwise: headcount fell from over 8,200 to 6,150, and H1 operating profit doubled to £35.2 million. The deflation is real. It landed in agency margin.
This week: ask each agency in writing whether your account’s AI costs are absorbed, passed through at cost, or marked up.
The Take
The belief: AI will make your agency’s work cheaper. The evidence: it made the work cheaper to produce, and nobody has committed to making it cheaper to buy. S4 Capital’s profit doubled while its headcount shrank by a quarter. Omnicom’s CFO says the company is moving toward an "outcome-driven" revenue model, and Omnicom’s CEO admits the market cannot yet price the AI underneath it. An agency that defines the outcome, prices the outcome, and hides the compute sets every number on the invoice. Do not sign an outcome-based deal without a token statement attached. Do not accept "AI-enabled" as a discount.
AI made agency work cheaper to produce. Nobody promised it would get cheaper to buy.
Also Worth Knowing
There is no standard for billing tokens. Digiday’s survey of agencies found Merge and Big Spaceship charging tokens as production line items, RPA absorbing them, and Pencil selling tiered "generation credits." Anomaly’s chief AI officer called pass-through "a money grab." Each model shifts risk to a different party, and only some of them shift it to you. Action: ask every agency which model it uses, in writing, before Q4 renewals close.
Agency AI bills are still mostly people. Digiday reported September 17 that Crispin runs about 100 AI tools on fixed annual fees, and Dept convenes a monthly AI Tool Committee to police spend. Omnicom’s CFO Phil Angelastro says revenue will move to an "outcome-driven model." Fixed fees and committees are cost controls agencies apply to themselves first. Action: ask which controls exist on your account and who signs off on overages.
Agentic ad spend is still small. Magnite’s CEO put 2027 protocol-based advertising at $600 to $700 million a year, and PubMatic’s revenue declined four straight quarters after launching AgenticOS. The infrastructure is arriving faster than the budgets. Action: cap agentic buying tests at 1 percent of programmatic spend until an agency shows you the cost per transaction and who pays for the compute behind it.
Under the Radar
Principal media is becoming the billing rail for AI. Trade coverage treats principal media and AI costs as separate stories. Digiday’s July 27 reporting joins them: clients commit a percentage of spend to agency-owned inventory, and the agency covers the compute. Robert Webster of TAU called some of the AI investment claims "manufactured to justify exactly this." IAB Europe’s Daniel Knapp described agencies as "futures markets" through principal deals. Your annual media audit likely covers neither the markup nor the tokens. Action: extend your audit scope to principal media pricing and token cost this quarter.
Frameworks & Vocabulary
The Shadow Rate Card: The price an agency charges for AI work when it is recovered through principal media, markups, or seat fees instead of a listed line item. Example: "Before we renew, show me the Shadow Rate Card for our account."
The Practitioner Move
The Token Audit. Put three questions in your next SOW: (1) What was our account’s token and compute spend last quarter? (2) Was it absorbed, passed through at cost, or marked up, and by what percent? (3) Does any of our spend route through principal media commitments? Then add a clause: token pass-through at cost, quarterly statement, capped at 3 percent of fees ($60,000 on a $2M retainer) as a negotiating start.
Think About This: When production costs fall, whoever controls the invoice controls where the savings land.
Forward this to the CMO renewing an agency retainer this quarter with no token line item in the SOW.
About mktg.ai
mktg.ai is the Creative Intelligence System for modern marketing. The platform unifies every creative asset, channel, and KPI in one place, connecting creative performance to spend in real time so teams can act at the layer consumers actually experience. Features include Ask mktg.ai for natural-language queries against your marketing data, and Daily Alerts AI for automatic anomaly detection that surfaces performance issues without waiting for weekly reports. On a $5M media budget, mktg.ai customers typically recover over $100,000 by reallocating 15 to 20 percent of spend toward higher-ROI creative within months. Learn more at mktg.ai.
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