Davidson: It’s Time for Naked 2.0

Why It Matters

Unbundling thinking from doing aligns agency incentives with client value, preserving strategic differentiation in an AI‑saturated market. It forces the media industry to adopt transparent, performance‑based pricing that can sustain profitability as execution costs collapse.

Key Takeaways

• AI cuts media execution costs dramatically
• Traditional retainers bundle thinking and doing together
• Execution should be priced per output, not spend
• Strategic thinking merits premium, spend‑independent retainer
• Market ready for “Naked 2.0” unbundled model

Pulse Analysis

The rapid adoption of artificial intelligence and automation tools is reshaping the economics of media buying and campaign management. Tasks that once required large teams—optimisation, reporting, and real‑time adjustments—are now handled by algorithms that operate faster and at a fraction of the cost. This cost compression creates a pricing paradox for agencies that continue to charge legacy retainers, which conflate the creative, strategic insight with the mechanical execution of campaigns. As AI standardises execution, the true differentiator becomes the human‑centric, forward‑thinking strategy that machines cannot replicate.

Separating strategy from execution, often called the “Naked” model, offers a clear commercial solution. By billing execution on a per‑output basis—such as per campaign, asset, or buying cycle—clients gain transparency and pay only for measurable work. Meanwhile, strategic services receive a premium, spend‑agnostic retainer that rewards original thinking without the conflict of interest inherent in bundled fees. This structure eliminates incentives for agencies to push high‑spend channels merely to boost their own margins, allowing planners to recommend the most effective mix based on data and insight rather than revenue considerations.

The market is primed for this evolution. Clients are increasingly sophisticated, demanding accountability and value from every dollar spent. Major players like WPP have publicly committed to moving away from time‑and‑materials billing, signaling broader industry acceptance. Whether an independent boutique, a downstream consultancy, or a creatively strong agency pioneers the first fully unbundled offering, the shift promises to restore strategic relevance and create a more competitive, cost‑efficient media ecosystem. The next few years will likely see a wave of “Naked 2.0” implementations, redefining how agencies price and deliver value in the AI era.