I just paid 53 clients of my agency, Acadia, their share of the six figure sum in rebates we received for media purchased in 2025.
Not all of Acadia’s clients were repaid; they had to qualify based on a rubric that includes timing of the buy, amount spent, the date the client was onboarded, among other factors.
But I did this to make a statement at a time when an uncomfortable portion of agency margin is coming from pocketing media rebates that belong to our clients.
Industry studies estimate that rebates and “non-transparent incentives” represent 3% to 10% of total spend on digital media globally, which now exceeds $600 billion. That sizes the rebate economy at $40 billion, roughly equal to the U.S. linear TV market.
Rebates, however, are earned by client spending volume—and should go back to them, or at the very least be disclosed to them transparently.
The silent rebate economy
As media fees have compressed over the past decade, rebates have quietly become a backdoor margin engine which that agencies have become structurally dependent on.
Agencies aggregate millions to billions of dollars in client media spend and deploy that capital across platforms and publishers. In return for that scale, publishers often extend rebates, incentives, or volume-based credits.
Industry benchmarks put average agency operating margins at 8% to 12%. Yet rebate income can account for 10% to 30% of total agency profit.
At the holding company level, that can add up to several hundred million dollars a year. Even a mid-sized agency managing $500 million in billings could generate as much as $25 million a year in rebate-driven margin.
Publishers are allowed to offer rebates; it’s good business practice. What’s bad business practice at best is when agencies keep those givebacks as profit—without disclosing them to clients.
That’s not optimization. It’s appropriation.
Opaque by design
Clients often don’t know this is happening, because the system is intentionally opaque.
Contracts are vague. Language is “commercially flexible.” Procurement teams focus on fees, not incentives. Marketers assume their agencies are acting in their best interest. And few clients ever ask publishers directly whether their spend is part of a rebate pool.
But clients can’t afford to have their rebates pocketed by agencies. They are under relentless pressure to prove ROI and justify every incremental dollar spent.
Agencies can’t afford it, either. We face unprecedented credibility challenges, and our future depends on trust, transparency, and true partnership.
