Avinash Kaushik spent roughly 16 years inside Google, has held senior client-side roles at companies like Intuit and DirecTV, and now advises brands and agencies as chief strategy officer at Human Made Machine. So, when he tells marketers to renegotiate their agency contracts and expect savings of 25% to 75%, starting this month, it is worth stopping whatever else you are reading.
I have known Avinash for more than 20 years. He does not throw out numbers like that for shock value. He builds a model, shows his work, and dares you to argue with the math. In his latest Marketing < > Analytics Intersect newsletter, “Pay Less, Grow More, Agencies in an AI-Era,” he does exactly that, and the argument reaches well past the performance and creative agencies he names directly. Anyone running SEO, content, or GEO work through an outside partner should be doing this same math on their own contract this week.
Kaushik’s starting point is that three forces converged at once. AI got broadly, generally smart, not just smart at one narrow task. The ad platforms happen to also own the foundational AI models running underneath the campaigns those platforms sell, so intelligence showed up fast and is already wired into the tools agencies use daily. And every system in the stack now talks to every other system in real time, which does not make AI smarter in the abstract; it makes AI smarter about your specific account. Put those three together, and you get what Kaushik calls the “we are not in Kansas anymore” moment for every type of agency, media, creative, performance, brand, measurement, and yes, SEO.
The practical result is that work that used to justify a monthly retainer is now handled by the platform itself, and Kaushik says clients should expect 25% to 75% savings on existing scopes of work as that shift plays out, alongside 15% to 25% growth in fees for genuinely new work the old contract never anticipated. He is not arguing for a smaller relationship with your agency. He is arguing that the money should move to different work.
Where The Old Contract Stops Making Sense
Kaushik breaks the old agency scope into clusters, and the pattern across every one of them is the same. Account architecture, keyword and audience structuring, and campaign build-out once ran roughly a fifth of a typical contract’s cost, and he estimates that work can shrink by close to 80% now that platform algorithms handle segmentation and targeting better than a human team slicing campaigns “for control.” Manual bid and pacing adjustments told a similar story, with AI already outperforming human pacing decisions since late 2024, and Kaushik makes a sharper point here that deserves attention beyond his own newsletter. He argues that an agency jumping in to “rescue” a dip during an AI learning cycle is not helping, it is actively sabotaging the algorithm’s ability to learn, and every one of those manual rescues resets the clock.
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