That size of the agency matters, when it comes to media.
A bigger media agency, the argument goes, gets better rates, because of the bulk of volume in buying. Media owners, apparently, lower their rates for bigger agencies who are buying a great volume of ads from them. The more you spend, the cheaper rate you get, and as an agency, you are then obliged or required to pass those cheaper rates to your clients.
Hence, clients with big budgets go to bigger agencies to get better rates.
So the theory goes.
And it truly amuses me.
Especially today, when 75% of all ad budgets are spent on digital media. And 90% of those media don’t sell with a fixed rate card, but with auction-driven biddable media. That means buyers are bidding for reach or actions by consumers, and if they win the bid, they get that deliverable. If they don’t win that bid, they lose out.
Don’t see your ad top of the pile in Google search?
Or your ad isn’t getting views on YouTube? That would be because you bid too low. If you up your bid, you will get seen.
Or if you tweak your targeting, or find a keyword that others are not bidding on, and where the price is lower, you could win that consumer action for cheaper.
So, does a bigger agency do better at performance marketing?
Not necessarily. Why?
Quite simply, because in performance marketing, there is no economy of scale. Everything depends on tools, insights, buying skills and optimization, attention to detail, the buyer’s skill, care and concern. And that buyer could just as likely be part of a small three-person start-up working from a trendy café as they are likely to be a large agency owned in France and with 20,000 staff globally. Digital media truly removes the advantage of scale, by its very nature of being.
So if there is no economy of scale for digital media, does it exist for traditional media? In the good old days, pre Covid, it used to. Bigger agencies could negotiate with TV or radio for lower media rates for their agency, and then re-sell to clients at higher rates, making a margin. And they might still offer cheaper rates than smaller agencies.
But with the drastic reduction in print and TV advertising, the clients of big agencies are not spending much money on traditional non-auction media. And traditional media owners are offering substantial discounts to just everyone, off their rate cards, because times are so difficult for them.
TV ad spend declined by more than 20% in 2025 in Malaysia. Hence now is a good time to go negotiate with TV companies.
Outdoor media owners are offering more than 50% discount off their rate cards, and yet you can see that digital screens are not fully occupied, and many static billboards give us a gaping, blank metallic stare even on the erstwhile prime Federal Highway. Again, it’s a good time to go chat with your friendly neighbourhood Outdoor media owner. Have a teh tarik, lend a sympathetic ear and get yourself a good deal.
The stark truth is that today a smaller agency, with a few staff, and a few clients, may probably get a better rate for a traditional billboard or a TV spot because:
Truly, scale has stopped meaning advantage, and in some cases, it may have even become a drag. Even when it comes to digital. Here’s why:
1. Technology flattened the playing field
What big agencies used to win with—exclusive tools, data, buying power—is now widely available.
Self-serve ad platforms (Meta, Google, TikTok, Amazon)
Off-the-shelf analytics and attribution tools
AI for planning, optimization, and creative testing
A sharp 10-person shop can access *the same levers* a 10,000-person network can.
2. “Bulk buying power” matters less than it used to
The old pitch: we’re big, so we get better rates.
But, as I mentioned,
Auctions are algorithmic, not relationship-driven
Performance beats volume
Platforms reward relevance and outcomes, not spend size
A smaller agency that optimizes faster often outperforms a giant that negotiates hard.
3. Speed beats bureaucracy
Media today moves in *days or hours*, not quarters.
Big agencies struggle with:
Smaller teams, on the contrary can test faster, kill bad ideas quicker, pivot creatives and budgets in real time.
In performance media, faster reaction time = greater ROI.
4. Importantly, and thankfully, clients don’t want “headcount,” they want impact.
Marketers themselves are under pressure to prove incrementality, tie media to revenue and justify every dollar. They’re less impressed by large top-heavy teams, fancy org charts, or global footprint covering Timbuktu to Tokyo.
They care about who is actually touching the account and how good they are.
5. Talent and people have changed.
Top media talent used to reside in big networks, and move around like an episode of Game of Thrones.
Now they go independent, join boutiques, build specialized shops (e-commerce, CTV, B2B, creator, growth) and strive for more work-life balance.
As Tom Cruise would attest, a few good sharpshooters beats a large team of generalists.
6. Creative + media integration matters more than reach
Winning today is about creative iteration, audience insights, signal interpretation and platform-native execution.
Big agencies often separate these functions. Smaller agencies *blend them*, which produces better performance.
Big agencies aren’t dead, but they are increasingly having to compete with independents and smaller, possibly more nimbler competitors. Big agencies have a deep people bench, and potentially the ability to invest more in AI tools. Perhaps they will still prevail. But whoever comes out on top, or if both kinds of players can co-exist, the truth is clear: size really isn’t the determinant of success anymore.
Sandeep Joseph is the CEO and co-founder of Ampersand Advisory, an award-winning media, creative, PR and data consultancy that has won over 470 awards in 9 years and was 9x #1 agency of the year/competition in 2025. He can be reached for debates or setting up teh tarik chats at sandeep@ampersand-advisory.com
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