Brands taking marketing in-house has turned into quite the movement over the last year. For marketers, speed, efficiency and overall, a need for more control has meant some highly publicized attempts to create their own in-house marketing functions that replace — either in part or full — agency offerings. But deciding whether to go in-house is difficult, and for some, the reality is it’s harder than it looks.
In 2018, 78% of ANA marketers surveyed said they had an in-house agency compared to 2013, 58% had in-house agencies.
“The benefits of having the agility, control and visibility into our creative [process], our performance and our audiences outweighed the benefit of having an agency for us at this time,” said NHL CMO Heidi Browning, of the league’s decision to take its creative and media business in-house.
The NHL is just one example of major marketers moving in-house. Others like Getty Images, Electrolux and Bayer have all taken various marketing capabilities in-house, as Digiday has previously reported. Last month, the beer behemoth Anheuser-Busch said that it had created an in-house team, draftLine, that would work with its roster of agency partners.
Taking marketing in-house exists on a spectrum, as taking programmatic in-house is a much more complicated endeavor than making banner ads or social content. Some, like Vodafone, have backpedaled on in-housing altogether after realizing how complex it can be to manage media.
Plus, even if in-house agencies are built at brands that could change, and has. Last December, Intel closed shop on its in-house agency, Agency Inside, after changing its marketing strategy, Teresa Herd, who ran Agency Inside and now serves as the vp and global creative director at Intel, previously told Digiday. “We met our ROI and all of our KPIs,” said Herd. “Intel is changing and they want to be focused on a B-to-B audience. We did a lot of great work and I built a great capability for the company. You have to give the company what they need and if that changes, you need to change with it.”
The choice to go in-house, stick with agencies or to use external and internal agencies obviously depends on the brand and its marketing needs. Doing so can be complicated and have various issues, per Digiday insights.
Here are the pros and cons.
For: Greater speed and efficiency
Work is done more efficiently and quickly with an in-house team. It’s not a surprising answer, having someone in the same building will certainly make it easier to execute an idea on the fly.
For brands looking to create marketing that reacts to something on the fly, having someone your office who is someone able to create a piece of work and get it out while consumers are still talking about it is key. “If you think about social and the speed of social, there really is no time to escalate and go back and forth with handoffs to and from an agency,” said Matt Weiss, managing director of growth at digital agency Huge. “Particularly when you’re doing things like community management where you need to react in real time.”
That’s been the case for Anheuser-Busch with draftLine, according to a representative for the company, who noted that the volume of work put out into the world has increased.
“From both a speed and a control standpoint, large brands need to have in-house capabilities,” said Scott Harkey, co-founder and managing partner of full-service agency OH Partners.
Against: Talent won’t want to work on one brand forever
For agency creatives, the diversity of work from client to client is appealing and part of the thrill of being at an agency. Being in-house and creating work for the same client day in and day out can be a slog, according to agency sources — a common rebuttal to why in-house agencies won’t last.
“Creatives live for variety,” said Weiss. “Having a steady diet of one brand limits creativity.”
It’s not just a matter of keeping creatives happy but if creatives are leaving out of boredom it can cost brands money. “Attracting the right talent and keeping up with the changes in the industry are cost drivers in their own right,” said David Eisenman, Co-Founder and CEO, Madwell.
For: It can reduce costs
Instead of paying agency fees, marketers who move those capabilities in-house are able to put those dollars right back into the marketing for the brand, said Browning. While budgets and fees will vary for every agency and brand, marketers say they are able to get more bang for their buck, so to speak, when asked about cost.
“We get more for our money,” said Browning.
Gene Foca, Getty Images CMO, echoed that sentiment in an email when asked about why the company moved its marketing in-house: “We simply found that the quality and volume of work that we were getting did not match what we could do for the money, internally.”
Though for others, the choice can come from a tightening of the belt. “Budgets are being constrained,” Intel’s Herd previously told Digiday.
Agency sources are skeptical of the reduced cost pitch and note that marketers can lose out on agency expertise.
“At its core, the move to bring media agencies in-house comes from a desire to cut costs,” said Eisenman. “But the reality is that the companies doing this each have their own specialty and area of expertise — and it is not media.”
Against: Media buying is very time consuming
For Browning and the NHL, there has been a recognition that the complexities involved are more time-consuming. Agencies often staff more people on a media account than when an in-house team handles it and they have more insight when it comes to pricing models and ad sets.
Even with more time spent on media some marketers, like Bayer, have been able to save significant marketing dollars — Bayer saved $10 million after taking programmatic in-house — by moving media buying in-house
For: Control and a deep understanding of the brand voice
One argument you’ll hear repeated again and again is that marketers are moving work in-house for greater control over their creative. In doing so, they are able to not only create more marketing more quickly but run tests on what’s working and what’s not. It can also help avoid issues, according to Browning, who said that if a player is part of a specific ad campaign and they are injured during a game the NHL is able to get that ad out of circulation much faster than if they had to go through an agency to do so.
“It’s crucial to have people that understand the brand to its core,” said Eisenman, who pointed to in-house’s deep knowledge of the brand. “In-house does this, and also provides brands with more consistency in both voice and tone.”
Against: Agencies have more analytical insights
But even with greater control, marketers can lose out on the insights that agencies bring in from other brands. With a brand only able to look at what has worked for it through its in-house team it is unable to take advantage of the insights that a marketer has with an agency.
“Agencies have broader performance insight because they manage all different types of campaigns,” said Browning. “They worked on a lot of different ads, advertising categories and we don’t benefit from the knowledge that they glean from other categories, performance and strategies.”
Only working on one brand and only using those insights can also lead to the potential to become myopic when it comes to marketing. Making sure that doesn’t happen can be dependent on who is at the helm, noted Huge’s Weiss, as that person will need to keep a healthy debate going about what’s best for insights as well as the in-house team.
“If it’s just about getting the agency to do exactly what you want that’s not good,” said Herd. “You need a little bit of critical distance. Maybe all the reasons for [in-housing] aren’t right but the pendulum is definitely swinging to that end. If companies don’t get what they want from agencies, they will figure out how to build it, whether it’s good or bad.”
[“source=digiday”]
