In 2023, a $50M DTC brand discovered they’d been paying their holding company agency an undisclosed 18% markup on media spend for three years. The revelation cost them $2.7M in hidden fees—and nearly bankrupted their growth plans.
This isn’t an isolated incident. It’s a symptom of a structural problem in how holding companies operate versus independent agencies. Here’s what most brands don’t realize until it’s too late…
1. Agency Expertise and Experience
One of the most important considerations is the media agency’s expertise and experience. Large holding groups have the resources to boast a client portfolio with big brand names, and independent agencies often focus on sectors and specific client profiles that align with values.Independent media agencies have fewer resources, so the team is strategically made up of more experienced marketers with specialized expertise. This extensive expertise enables independent media agencies to craft deeper strategies to help brands effectively engage the target audience and increase market reach. While large holding groups may have expertise at the senior levels, there is an even larger team of generalists that are working on day-to-day with clients. With independent media agencies you will work directly with the team without any middlemen or generalists.Make sure to ask for case studies, client references, and details about how they approach campaigns to gauge their expertise and process. Independent media agencies usually have a healthy mix of being scrappy yet organized — and that’s something to embrace when you’re working with a team of marketers who have decades of experience combined.2. Communication and Transparency
Transparency is nothing revolutionary. In fact, transparency must be the basis of agency partnerships. From performance metrics and advertising spend to operations and reporting, open communication between your agency and team is pivotal. Some larger holding groups have complex operational requirements that lead to lack of clarity in campaign reporting and ad account ownership.With an independent media agency, communication is often more transparent because you a more direct relationship. This leads to better understanding of advertising spend, clearer evaluation of campaign performance, and alignment in strategy. Independent media agencies that are open in their communication are often true partners for many years with brands through growth.3. Data Ownership
Big holding groups have a tendency to keep things close their their chest. Clients who work with large holding groups face challenges to gain complete access to their advertising accounts and especially challenged with access when clients leave for independent media agencies.When you work with independent media agencies, you own all your ad accounts, your data, and reports. No matter the size of your business, an independent media agency will work with you to ensure that any data from your campaigns is secure and 100% owned by your team from day one.Note: Account ownership transfer is possible. When a large holding group say otherwise, it is simply untrue.4. Responsiveness
For any sized business, the agency team’s responsiveness must be reasonable and timely. The media agency you partner with should be able to provide responses within 24-hours of your inquiry, and within a few hours when the issue is urgent and threatens operations.Large holding groups may have extensive resources but because of the large portfolio or demanding client projects, they are often stretched with the larger clients’ projects. That means leaving many clients with delays and unmet business needs. Independent media agencies have more focused portfolio of clients and they can provide more flexibility, higher response rate, and attention to their clients as they grow.5. Cost Structure
The old adage “you get what you pay for,” does not directly apply when it comes to agency costs. While large holding group costs are much higher than independent media agencies, the quality does not always justify the higher fees that large holding groups charge. In addition to high agency fees that large holding groups charge, clients are also locked into annual or multi-year contracts.While some independent media agencies have 6- or 12-month contracts, they tend to be more flexible and agreeable with clients. The pricing that independent media agencies can afford is due to more efficient employee structures, no expensive office space leases, no extravagant expenses, and better operating margins. Unlike larger holding groups, the independents do not have these additional costs to be concerned with.6. Digital Proficiency
You want your agency to be proficient in all disciplines of digital advertising. At the minimum, your agency must have their finger on the pulse of the industry. From the latest beta features available in social media and search to digital platforms and software. An independent media agency stays up-to-date with digital trends so they are aware of cutting-edge strategies to help clients navigate their digital journey.The reality is that in most independent media agencies, the team has shared responsibilities and commitment to make things successful. In larger holding groups, most employees are there to do good work and collect paychecks. There is more skin in the game for independent media agencies with more risks than the larger holding groups with an almost infinite amount of resources to keep the lights on.Warning Signs You’re With the Wrong Agency
- You don’t have admin access to your own ad accounts
- Contract has auto-renewal clauses or 90+ day termination periods
- You’ve never spoken to the person actually managing your campaigns
- Invoices are vague or consolidated without platform breakdowns
- They resist giving you direct platform credentials
- Your “strategist” has been there less than a year
- They can’t explain exactly how they’re compensated beyond retainer
Frequently Asked Questions: Choosing Between Independent and Holding Company Agencies
What contract terms should I look out for with holding companies?
A: Here are the red flag clauses to negotiate or avoid:
🚩 Auto-Renewal Clauses:
- What they say: “This agreement automatically renews for successive 12-month periods unless terminated with 90 days notice.”
- Why it’s dangerous: You could decide to leave in Month 10, give notice, but still owe fees through Month 22 (12-month renewal + 90-day notice)
- Negotiate to: Month-to-month after initial term, or maximum 30-60 day notice period
🚩 Work Product Ownership:
- What they say: “All strategies, campaign structures, and derivative works remain the intellectual property of [Agency].”
- Why it’s dangerous: They claim ownership of audience segments, campaign blueprints, and strategic frameworks you paid them to develop
- Negotiate to: “Client owns all work product and deliverables upon payment. Agency retains right to use anonymized case studies.”
🚩 Non-Compete/Exclusivity:
- What they say: “Client agrees not to engage other agencies for [digital media/paid social/etc] services during term.”
- Why it’s dangerous: Locks you in even if performance deteriorates
- Negotiate to: Remove entirely, or limit to “Client will designate Agency as primary partner but retains right to specialist support.”
🚩 Vague Termination for Convenience:
- What they say: “Either party may terminate with 90 days written notice and payment of termination fee equal to 25% of remaining contract value.”
- Why it’s dangerous: Leaving a 2-year contract in month 6 could cost you 25% of the next 18 months = ~4.5 months of extra fees
- Negotiate to: “Either party may terminate with 60 days notice. Client pays only for services rendered during notice period.”
🚩 Data and Account Access:
- What they say: “Agency retains administrative access to all platforms and accounts as primary administrator.”
- Why it’s dangerous: They control your data, pixels, audiences, and can hold them hostage during transitions
- Negotiate to: “Client is primary administrator on all accounts. Agency receives admin access as secondary user. All platform accounts created in Client’s legal business name.”
Can I actually transfer my ad accounts from a holding company to an independent agency?
Yes, absolutely—and they cannot legally prevent you. However, they will make it difficult. Here’s what actually happens:
The Transfer Process (What Should Happen):
- You request admin access to all accounts (Google Ads, Meta Business Manager, LinkedIn Campaign Manager, etc.)
- Agency provides credentials within 24-48 hours
- You grant your new agency access
- Transition complete
The Transfer Process (What Actually Happens with Holding Companies):
- You request admin access
- They claim “security protocols” require 2-3 week review
- They “discover” accounts are under their Business Manager/MCC (not yours)
- They require you to sign liability waivers
- They transfer only partial access (limiting historical data)
- They claim audience segments and campaign structures are “proprietary agency IP”
- They delay until your contract notice period expires (keeping you paying longer)
Your Rights:
- Platform Policies: Google, Meta, LinkedIn all specify that advertisers own their accounts and data. Agencies are service providers.
- Legal Ownership: If advertising spend came from your budget, you own the results and data
- Pixel Data: Conversion pixels installed on your website belong to you, period
What You’ll Lose (Even in Successful Transfer):
- Learning Period: New agency needs 30-90 days to optimize based on historical performance
- Platform Representatives: Holding companies’ agency reps don’t transfer with you
- Proprietary Audiences: If they built audiences in their infrastructure, you start from scratch
How to Protect Yourself:
- Before signing: Negotiate that all accounts are created in your business name with you as primary admin
- During relationship: Quarterly audit to ensure you have admin access to everything
- Before leaving: Document all account URLs, audience definitions, campaign structures
- During transition: Have new agency ready to immediately replicate campaign structures
Real Example: A B2B SaaS company gave 90-day notice to their holding company. The holding company took 87 days to “process” the account transfer request, forcing the client to pay for nearly the entire notice period while unable to transition. They finally transferred accounts… but “accidentally” deleted 3 years of conversion history and custom audiences. Legal action recovered costs but not lost data.
What exactly do I lose if my agency owns my pixels and conversion tracking?
This is the most underestimated risk in agency relationships. Here’s what’s at stake:
1. Conversion Learning Data ($50K-$500K value) Platform algorithms learn from conversion data over 6-24 months. If your Meta Pixel, Google Ads conversion tag, or TikTok Pixel is installed under the agency’s Business Manager:
- Facebook/Meta: Loses all historical conversion optimization data. Algorithm starts from scratch. Expect 40-60% efficiency loss for 90-120 days.
- Google Ads: Conversion history doesn’t transfer. Smart Bidding loses all learning. Expect CPA to increase 30-50% during relearning.
- TikTok/Snap/Pinterest: Complete reset. You’re bidding against competitors with mature algorithms.
Real cost: A $2M/year ad spend account losing 45% efficiency for 90 days = $200K+ in wasted spend during transition.
2. Custom Audiences (Potentially Millions in Value) If audiences are built in agency-controlled infrastructure:
- Customer match lists: Your customer data, but uploaded to their assets
- Lookalike audiences: Based on your conversions, but owned by their account
- Website custom audiences: Your website traffic, their pixel
- Engagement audiences: Your content, their catalog
What it takes to rebuild: 60-180 days to regenerate comparable audience quality, depending on traffic volume.
3. Attribution Modeling If using agency-provided attribution tools or dashboards:
- Historical data doesn’t export cleanly
- Multi-touch attribution models need rebuilding
- Channel performance comparisons lose historical context
Do independent agencies have access to the same tools and platforms as large holding companies?
Yes—and this is a myth holding companies perpetuate. Here’s the reality:
Platform Access (Identical):
- Google Ads: Any agency can access the full platform. “Google Partner” status is marketing, not a technical advantage
- Meta Business Suite: Identical interface and features for all agencies regardless of size
- LinkedIn Campaign Manager: No special features for large agencies
- TikTok for Business: Early beta access goes to high-performing agencies, not just large ones
- Programmatic DSPs: The Trade Desk, DV360, Amazon DSP all accept independent agencies meeting minimum spend thresholds ($10K-$50K/month)
Where Size Matters (Barely):
1. Platform Representative Access:
- Holding Companies: Dedicated Google/Meta/LinkedIn reps due to $50M+ annual spend
- Independent Agencies: Typically shared reps or self-service support until reaching $5M+ annual spend
- Reality: Platform reps are helpful but not game-changing. Most optimizations come from agency expertise, not rep guidance
2. Alpha/Beta Features:
- Holding Companies: Sometimes get early access to test features
- Independent Agencies: Apply for betas and often get accepted based on innovation history
- Reality: Beta features become public within 3-6 months. First-mover advantage is temporary
3. Volume Discounts:
- Holding Companies: Negotiate volume rebates with platforms and vendors
- Independent Agencies: Pay standard rates
- Reality: Those “volume discounts” at holding companies rarely pass to clients (remember the rebate scandal)
Where Indies Actually Have Advantages:
1. Tool Stack Flexibility:
- Holding Companies: Locked into enterprise contracts with specific vendors (often kickback arrangements)
- Indies: Choose best-in-class tools for each client’s specific needs
2. Emerging Platform Adoption:
- Holding Companies: Slow to adopt new platforms (risk averse, require executive approval)
- Indies: First to test TikTok (2019), Threads (2023), and emerging platforms
3. Specialized Partnerships:
- Indies: Often have deeper partnerships with niche platforms (podcast advertising, influencer networks, DTC-specific tools)
- Holding Companies: Focus on mainstream platforms where scale matters
How do I evaluate an agency’s actual expertise vs. their sales pitch?
The pitch is theater. Here’s how to see through the performance and evaluate real capability:
DURING THE PITCH:
🚩 Red Flag Statements:
- “We’ve worked with brands like Nike, Apple, and Google” (name-dropping without proof)
- “Our proprietary AI algorithm optimizes campaigns 24/7” (buzzword bingo)
- “We guarantee X% ROI improvement” (impossible to guarantee)
- “We have a proven playbook for your industry” (cookie-cutter approach)
✅ Green Flag Statements:
- “Here are three challenges we anticipate based on your current setup…” (shows they’ve done homework)
- “We’d recommend testing these two approaches, here’s why…” (demonstrates strategic thinking)
- “This won’t work for you because…” (honesty about limitations)
- “Here’s a campaign that failed and what we learned…” (transparency)
QUESTIONS TO ASK:
1. “Walk me through how you’d approach the first 90 days with our account.”
What you’re evaluating:
- ❌ Bad answer: Generic phases (“audit, strategy, implementation”)
- ✅ Good answer: Specific questions about your business they’d need answered, platforms they’d audit first, hypotheses they’d test
2. “Show me a campaign that underperformed and what you did about it.”
What you’re evaluating:
- ❌ Bad answer: “We don’t really have campaigns that underperform” (lying)
- ❌ Bad answer: Blames the client or external factors
- ✅ Good answer: Walks through data, their hypothesis for why it failed, how they pivoted, what they learned
3. “Who specifically will work on my account, and can I meet them now?”
What you’re evaluating:
- ❌ Bad answer: “We’ll assign the right team after you sign”
- ❌ Bad answer: You meet senior people during pitch who won’t actually work on your account
- ✅ Good answer: The actual team is in the pitch presentation, answering questions
4. “What’s your approach to [specific tactical challenge relevant to your business]?”
Examples:
- “How do you handle iOS 14.5 attribution loss for our Facebook campaigns?”
- “What’s your experience with multi-touch attribution for long sales cycles?”
- “How do you approach YouTube creative testing for B2B audiences?”
What you’re evaluating:
- ❌ Bad answer: High-level platitudes without specifics
- ✅ Good answer: Tactical specifics with examples from similar situations
5. “What tools and platforms would you use for our account, and why?”
What you’re evaluating:
- ❌ Bad answer: “We use our proprietary tool suite” (vendor lock-in)
- ❌ Bad answer: Lists 15 expensive tools (unnecessary complexity)
- ✅ Good answer: Recommends 3-5 tools specific to your needs with rationale, offers alternatives
REQUEST THESE MATERIALS:
1. Case Studies with Real Data
- Not “improved ROAS by 300%” (meaningless without context)
- But “reduced CPA from $150 to $85 over 6 months for B2B SaaS client with $2M ad spend”
Ask for:
- Starting metrics and timeframe
- Specific strategies implemented
- Results with statistical significance
- Challenges encountered
2. References from Similar Clients
Don’t just ask for a reference list. Ask:
- “Can I speak with a client who’s been with you 2+ years?”
- “Can I speak with a client in [your industry]?”
- “Can I speak with a client with similar budget/business model?”
During reference calls, ask:
- How often do you interact with the actual strategist vs. account coordinator?
- Have you had team turnover? How did they handle it?
- What’s one thing they’re not great at?
- Would you recommend them to your competitor? (If they hesitate, dig deeper)
3. Work Samples
For media agencies, request:
- Example media plan for similar business
- Sample reporting dashboard (anonymized)
- Creative brief template
- Campaign post-mortem document
What you’re evaluating:
- ❌ Overly complex documents designed to impress, not inform
- ✅ Clear, actionable documents that demonstrate thinking
TECHNICAL DEPTH CHECK:
Ask progressively more detailed questions to test depth:
Level 1: “What’s your experience with Google Performance Max?” Level 2: “How do you structure asset groups for PMax?” Level 3: “How do you prevent PMax from cannibalizing branded search?”
If they can’t get past Level 2, they don’t have hands-on expertise.
DIG INTO THEIR OWN MARKETING:
Evaluate their website/content:
- Do they practice what they preach?
- Is their own SEO strong? (If they can’t rank themselves…)
- Do they publish thought leadership content?
- Are their case studies specific or vague?
Check their social proof:
- Google reviews (look for patterns in complaints)
- Clutch/G2 reviews (more detailed feedback)
- Industry recognition (real awards vs. “pay to play” awards)
THE ULTIMATE TEST:
“Can you provide a paid trial period?”
Some agencies (especially indies) will offer:
- 30-day paid trial at reduced rate
- Limited scope project before full engagement
- Money-back guarantee on first month
If they’re confident in their abilities, they should be willing to prove it with skin in the game.
RED FLAGS DURING EVALUATION:
- 🚩 Pushy sales tactics or pressure to sign quickly
- 🚩 Unwillingness to provide specific examples or data
- 🚩 Contract requires signature before meeting actual team
- 🚩 Vague answers about pricing or fee structure
- 🚩 Defensive reactions to tough questions
- 🚩 They haven’t looked at your current campaigns/website before the pitch
Can I manage some channels in-house and outsource others to an agency?
Yes, and this “hybrid model” is increasingly common. Here’s when it works and when it doesn’t:
WHEN HYBRID WORKS WELL:
Scenario 1: Specialized Expertise
- In-house: Brand social media, content creation, email marketing (where brand voice is critical)
- Agency: Paid media, SEO technical implementation, conversion rate optimization (specialized skills)
Scenario 2: Capacity Model
- In-house: Strategy, creative direction, brand guidelines, campaign concepting
- Agency: Execution, optimization, reporting, day-to-day management
Scenario 3: Channel Specialization
- In-house: Facebook/Instagram (your core channel, deep expertise exists)
- Agency: Google Ads, LinkedIn, programmatic (secondary channels needing ramp-up)
Scenario 4: Test and Learn
- In-house: Proven channels with documented playbooks
- Agency: New channel testing (TikTok, Reddit, CTV) where you lack expertise
REAL EXAMPLES:
Example 1: Mid-Size DTC Brand ($20M revenue)
- In-house team (3 people): Social media management, influencer partnerships, email marketing, creative direction
- Agency partner: Paid social execution, Google Ads, affiliate management
- Why it works: Brand maintains voice and creative control, agency provides performance marketing expertise
Example 2: B2B SaaS ($50M revenue)
- In-house team (5 people): Content marketing, SEO strategy, product marketing, sales enablement
- Agency partner: Paid search, LinkedIn ads, conversion optimization, technical SEO
- Why it works: Long sales cycles require deep product knowledge (in-house), but paid channels need specialized optimization (agency)
Example 3: E-commerce ($100M revenue)
- In-house team (8 people): Facebook/Instagram ads, email/SMS, retention marketing, creative production
- Agency partner: Google Shopping, Amazon advertising, affiliate, emerging channels
- Why it works: Core revenue driver (Meta) managed in-house with dedicated resources, everything else outsourced
WHEN HYBRID DOESN’T WORK:
❌ Scenario 1: Accountability Gray Zones
- In-house manages Facebook campaigns
- Agency manages Instagram campaigns
- Both on same platform, unclear who’s responsible for overall Meta performance
- Result: Finger-pointing when performance drops
❌ Scenario 2: Fragmented Data
- In-house uses different attribution model than agency
- Inconsistent reporting across channels
- Can’t understand customer journey across touchpoints
- Result: Poor strategic decisions based on incomplete data
❌ Scenario 3: Duplicated Costs
- In-house team and agency both paying for same tools
- Redundant tech stack costs (2x Semrush licenses, 2x Supermetrics, etc.)
- Result: Inefficient spending on infrastructure
❌ Scenario 4: Communication Overhead
- Weekly agency call + internal team meetings + cross-functional alignment
- Information doesn’t flow smoothly
- Decisions take longer because multiple parties need alignment
- Result: Slow decision-making kills agility
❌ Scenario 5: Skill Overlap Without Clear Division
- In-house junior marketer “dabbling” in Google Ads
- Agency also managing Google Ads
- No clear handoff or complementary skill sets
- Result: Confusion and inefficiency
