Media agencies are restructuring at speed, but the commercial logic behind those moves is only just becoming visible. For CMOs, procurement leaders and global heads of media, the recent WPP strategy reset and court disclosures are a rare x‑ray of how your money really makes agency profit.
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The combination of WPP’s Elevate28 strategy and the Project Claridges court disclosures tells you exactly where holding companies plan to make money: media, proprietary inventory and AI-enabled scale. For marketers, the priority now is understanding where your budgets intersect with these profit pools and putting guardrails around them.
Elevate28, announced alongside 2025 results, reorganizes WPP into four operating divisions – Media, Creative, Production and Enterprise Solutions, all stitched together by WPP Open. The goal: $676m in annual cost savings by 2028 and a simpler, media‑led group after an 8% revenue decline and 71% drop in operating profit.
At the same time, the leaked “Project Claridges” presentation, released in ongoing litigation, shines a light on $1bn of what WPP calls a “non‑product related income” engine built on rebates, content deals and, most significantly, proprietary media trading. That disclosure doesn’t just affect WPP, it validates what many CMOs have long suspected about the wider holding‑company model.
Your immediate pain point: you are being asked to trust agency partners whose future growth depends on maximizing margin on your spend, precisely when you are being told to cut budgets and prove every dollar of effectiveness.
The court documents outline an internal view of WPP’s economics that most advertisers never see. A $1bn “non‑product” profit centre sits alongside the fee income you recognize on your SOW. The biggest component is proprietary media, where the agency buys inventory, repackages it and resells it at a margin. Btw. You might see this referred to other things like principal based buying, inventory media, arbitrage, media brokering, inventory reselling (why so many names?)
Anyway, one example in the filing is now being dubbed 'TikTok math' that illustrates the scale. WPP committed $70m of client spend into TikTok. In return, it received $107m in media credits. Those credits were then sold on for $98m, locking in roughly $29m of margin on top of the original $70m of advertiser money. The documents suggest that WPP gets to retain that $29m under terms of contracts with their clients.
From a corporate perspective, this is smart arbitrage. From a CMO’s perspective, it might raise a few urgent questions: Was TikTok chosen because it was the best place to grow your brand, or because it unlocked the richest margin for the agency? Were those benefits transparently disclosed and contractually agreed, or buried inside a pooled trading arrangement you never see?
Overlay this with the $400m, five‑year Google Gemini AI deal, positioned as fuel for WPP Open. That investment will supercharge the ability to manufacture and optimize inventory at scale and, by extension, to expand that non‑product profit pool unless client governance keeps pace.
The famous adage says that the golden rule of business is “whoever owns the gold, can makes the rules”. In theory, as advertisers you own the budget, so agencies play by your rules. In practice, the complexity of today’s media supply chain has quietly reversed that relationship in critical areas like proprietary media and rebates.
When agencies aggregate billions of dollars of spend across clients, they become the counterparty platforms, publishers and data firms want to please. That creates parallel incentives: one set described in your contract, and another driven by group‑level trading targets, for example, internal ambitions to grow non‑product income 15% a year even when client categories are flat.
For CMOs, this asymmetry can show up as confused performance signals. You can see delivery, but you cannot always see price paid, net rebates, or how much of your plan is routed through owned or pre‑committed inventory. You are asked to trust that recommendations are objective, while your own procurement teams sense the commercial tail could be wagging the strategic dog.
The result is a confidence gap. Senior marketers tell us they are being briefed on restructures by their agency holding groups, but almost never see a simple, quantified map of where and how those groups actually make money from their spend. Advertisers feel they have a right to be stakeholders in the agency's strategy to assume a 'principal' role over advertising budget allocations.
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To fix the incentive problem, you do not need to blow up your agency relationship. ID Comms co-founder David Indo suggests you do need to modernize your media governance so it reflects how WPP and other agency companies now operate. David advises that these three moves are typically achievable within a quarter for most advertisers.
First, demand a forensic explanation of your agency’s operating platform, in WPP’s case, WPP Open. Treat it as a critical infrastructure dependency, not a slide in the credentials deck. Ask for a clear map of the tools, data, AI models and inventory pipes that touch your campaigns, and where group‑level commercial deals sit in that stack.
Second, create explicit policy on proprietary and inventory media. For example, you might cap inventory‑based buying at 10–20% of spend, mandate channel‑level reporting, and reserve the right to exclude certain deals entirely. If the TikTok‑style maths shows a 40%+ gross margin, that may be acceptable, but only if it is transparent, auditable and demonstrably brand‑safe.
Third, update your contract and audit rights. Legacy “no rebates” language is meaningless if value is created and retained via credits, AI tooling, data fees or content barter. You need the ability to see and test outcomes: where your ads ran, how they performed, and how any non‑product income related to your account is calculated, even if you do not see exact buy prices.
In the wake of Elevate28 and Project Claridges, every CMO, procurement director and global head of media should be asking three very specific questions, ideally in writing, at holding‑company level.
1. “Where, exactly, do you make money on our media investments?” Request a breakdown of fee income versus "non‑product income" related to your account: rebates, proprietary media, data, technology, content and any platform‑level commitments (for example, TikTok or Google). You are not asking for trade secrets; you are asserting shareholder rights over how your money is monetized.
2. “What proportion of our spend can flow through proprietary or inventory media, and under what rules?” Press for a target range and a hard ceiling. Insist on visibility of inventory sources, quality guarantees and clear exit rights. If the agency expects these trades to grow 15% annually, you need to know what that does to channel mix and risk. Ask to know ALL the parts of your agency (including affiliates) that can touch your media investments, not just your lead agency.
3. “How are your people incentivized, to grow our business or to sell specific media?” Ask how bonuses, KPIs and promotion criteria have changed under Elevate28‑style restructures. If traders and planners are rewarded on margin or volume through certain pipes, you must compensate with stronger client‑side governance and independent performance measurement.
None of this is about vilifying agencies. WPP and its peers are doing what any listed group must do after an 8% revenue slump and having to make thousands of job cuts: Simplifying, doubling down on profitable lines, and betting on AI. Your job is to make sure those bets accelerate your growth, not just theirs.
The brands that win in this next phase will be the ones whose media governance is as sophisticated as their agency’s trading model. That means clear policies on proprietary media, modern contracts that acknowledge and account for on‑product income, and independent analytics that keep everyone honest.
CMOs want (and need) agencies their to be successful. They want their agencies to attract amazing talent and build amazing resources. Let's be clear; asking these questions is not trying to limit agencies' capacity to be strong and grow. We are not all trying to put agencies out of business. But CMOs have a right to ask their agencies to be aligned and organized to benefit them as the customer. Its fair to ask questions of your major business partners like this, in fact its your obligation to your own leadership.
If you want a confidential space to stress‑test your current arrangements, benchmark your exposure to non‑product income, or rehearse the questions above before you ask them, get in touch. We can help you build a game plan that protects your competitive advantage and ensures that, once again, the marketer who owns the gold genuinely makes the rules.