Bundled media is bigger problem than principal media: OMG
OMG's Kristiaan Kroon, second left, said that "bundled media" is a bigger problem for clients.
Omnicom Media Group Australia’s chief operating officer, Kristiaan Kroon, has waded into the principal media debate, arguing that “bundled media” is the real villain — and stressing that the holdco does not engage in the practice.
Speaking on a panel at Mutinex’s Marketers and Money ’25 conference, Kroon said inventory packages that mix formats, channels, and ad products are a “bigger problem for customers” than the principal trading practices currently under scrutiny at holdcos.
Responding to a question from moderator John Sintras about agency remuneration and principal media, Kroon said bundled media is often conflated with principal media, but the two are “fundamentally different products.”
“We don’t do anything that’s bundled,” he told the audience. “If you buy a bundled media product, you can’t use a [marketing mix modelling] product like Mutinex particularly well. You can build proxies for it, which is the same for our measurement tool and everyone else’s.”
I can confidently say right now that there is no media agency operating in either Sydney or Melbourne that doesn’t have principle media buying arrangements in place with multiple publishers. Maybe apart from those who have gone broke.
You can call in “bundled media”, but anything that results in a company being provided with kickbacks for diverting their client’s money into certain publishers is deceitful conduct and unethical, at best.
Wasn’t the whole angle of principal media to begin with that the agencies bought the inventory “at a lower cost” and then sold it back to clients. That they were entitled to make a larger margin because they took the risk and bought the inventory in advance.
Now they don’t buy it? So what is it? Is it a just share deals under a new name. How can you sell a principal media product (bundled / prop etc) if you’re selling something you don’t own and haven’t bought?
Correct, no one (at least locally) is going to treasury for many multiple of millions upfront to prepay media owners for inventory. It’s all done on forward share / volume commitments like it always has been. Now clients just double-opt in via their contract and on the plan and it’s the same game by another name.
The entire commercial model for a large part of the industry is reliant on non-client revenue, as it always has been. Why are you surprised?
Useless opinion/article if bundled media is not defined at any point. Just reads like baseless deflection.
Never heard of bundled media, and, which client would actively buy this? Seems very murky. Kroon is throwing around some smoke and mirrors to deflect the very real problem (and revenue driver) of principal media for agencies.
Holding groups are crashing so fast
Love this from KK.
Many will be aware of omni channel providers expertly finding gross margins on one line whilst bundling with others and claiming it is competitive. Just look at the pretty planning tool.
Often dressed up as BVOD with large volumes of online video on web domains.
Supplemented with passbacks because the overall margin is so high.
No surprise the biggest HC (‘partnering’ strongly with an omni channel managed service business) exponent of this behaviour is the one looking for a buyer. It doesn’t work out in the end.
Glad to see someone call it out.
“That’s a CDO of a CDO. also known as a “CDO-squared”