Hysteria over in-housing has reached fever pitch. But rather than threatening agency growth, the surge of in-housing reconfirms the value that agencies bring to brands and businesses. Instead of disrupting the traditional agency-client relationship, in-housing is enabling agencies and clients to partner better than ever.
A new breed?
The background to the growth of in-housing is disruption and the explosion of digital - the experience economy relies on brands and businesses to be both agile and efficient and creative and innovative. Their evolving business needs are forcing marketers to look at their structure and re-balance in-house and external capabilities to support their transformation.
In our survey of 1,000 global CMOs, 75% said they need ‘better internal integration’ to deliver their customer experience goals and as such, in-housing has become the go-to strategy for CMOs looking to transform their corporate departments and re-think their spend - bringing agility, data and technology capabilities and market-leading insights and ideas into their teams.
The trend towards in-housing is demonstrated in Forrester & In-House Agency Forum’s latest report, with 64% CMOs saying they already have in-house agencies, an increase from 42% a decade ago, according to the Forrester Unleash The Potential Of In-House Agencies report (2018).
This was supported by findings in Dentsu Aegis Network’s CMO report where 52% of marketers said they would bring even more capabilities in house in the next 2-3 years. But this doesn’t mean doom and gloom for agencies - in a 2018 report on selecting the right agency by Gartner, most marketers ‘expected to retain or expand their use of agencies between now and 2020’ and marketers are increasingly look to large full service agencies to deliver their CX initiatives.
But whose job is it anyway?
The roles & responsibilities of the marketer have changed beyond recognition. Marketing’s proximity to the customer has placed in-house departments as a central driver of business strategy and planning, with Marketing also picking up CX and the creation of new products and services. And it’s not just increased demands from inside the business, in our CX survey 46% CMOs said they ‘struggle to deliver on customer expectations today’, and ‘the pace of customer expectations’ is holding back 57% business.
So how does In-housing support marketers?
Traditionally marketers have been the brand guardians of their business. However in an age where brands are not they say, they are what they do, experience strategists are the new brand guardians - demanding more of marketing teams than ever before. This was also demonstrated by the urgency of 79% CMOs who predicted that they will ‘have to work harder to deliver consistently across all touchpoints of their brands’6. Today, marketers need more control, transparency and visibility of their customer in order to build effective experiences and create revenue growth. By bringing these skills and capabilities into marketing departments through in housing, marketers can quickly collate and analyse their data to transform their businesses.
Marketing teams need a stable talent team to deliver change over time, and inhoused talent ensures a steady stream of people responsible for delivering change (projects that are solely delivered by the business can stall when people leave). On the other hand in-housing provides the business with financial security when capability requirements and business need change.
As In Insource or Outsource by Garner explains, “Critical skills like market and customer insight, product management, and brand/content/ messaging are essential to marketing success, but marketers struggle to secure and develop these capabilities.”
In-housing offers businesses the ability to access sought-after skills in the marketplace, and relieve the pain and expense of recruiting and retaining specialist talent. These dynamic expert agency resources can support by offering resource in capability, knowledge and capacity gaps, working on specific (often short-term) projects that can be briefed by the brand marketing department. Furthermore in housing leverages valuable agency cultures that scale and set up teams at speed.
In-housing can even boost an organisations creativity, with agency staff brining fresh ideas from the breadth of the marketing landscape. The value of agencies lies in a deep understanding of consumers and culture, an ability to develop creative ideas and campaigns, along with a depth of technological expertise and talent, and these happen to be the qualities are critical to transforming a business today.
This was also evidenced in DAN’s survey of CMOs where 62% said that agencies’ ability to develop creative ideas and campaigns was an important future source of differentiation. In-housing has the potential to bring creative agencies passion for work, their craft and immersing themselves on the sharing of big ideas to the brand board room.
Isobar’s in-housing solution ‘Accelerate’ helps brands remodel their marketing approach on their digital transformation journeys. We build teams specifically to enable our clients to fast track their in-house capabilities - whether creative, tech, consulting or data - offering a partnership that can quickly respond to business challenges and deliver custom solutions rooted in a business’s insights and culture. These provide more flexibility in how resources are deployed and managed with an ambition for in housing to fundamentally boost creativity and collaboration and bring about longer term partnerships.
Try out four steps to find out whether you need an in housing solution
- Could you benefit from a turnkey solution that incubates and bootstraps an in-house team? Would your brand & business benefit from agency experience, capabilities and credentials on tap?
- Consider where expert talent can extend your existing team to help drive strategic initiatives within organisations
- Can consulting services on the processes, training and insights help your strategic planning?
- Audit whether the your current innovation accelerators and products that are designed to help your business increase velocity are achieving objectives?
So what’s the outcome?
By working with both in-house agency talent and client marketing departments, brands can blend key capabilities across creative, technology and media to centralise data and insights and share responsibility and accountability across departments. By owning and controlling marketing from the centre, brands can ensure deep partnerships that deliver better outcomes.
Sue McCusker, global chief client officer at Isobar.