In-housing versus Outsourcing. Should you move your digital marketing in-house?
According to State of in-housing 2019 report, published in January 2019 by Digiday and BannerFlow, 91% of brands based in Europe are now doing all or part of their digital marketing in-house.
What are the main drivers for brands to move digital marketing in-house?
- Cost saving is one of the main drivers. However, it is not that easily achieved as both significant initial investment and continuous funding is required to ensure your digital marketing stays on top of the advancements in the field.
- Desire to own data is not only about owning the keys to platforms and making sure everything is GDPR compliant, but even more about opening the capabilities of the entire marketing stack. Brands are generating huge amounts of first-party data that shed light on customer interactions across all touchpoints. Make sure you own the insight.
- Full transparency starts with fees, but at the same time raises additional questions. Does your agency charge hidden fees tied to your media spend? Is your data packaged and resold to your competition? Do you really need to use all the 3rd-party solutions to execute your campaigns successfully? Digital marketing is not supposed to be a black-box, but when it is, in-housing starts to look like an attractive alternative.
What are the top barriers to consider before you move?
- Cost can be a barrier too. Evaluate your size and whether it makes economic sense to have the operation in-house. Being the best at everything is costly. Also, keep in mind that most marketing technology pricing allows agencies to reap the rewards of scale, same tools may cost more when bought directly.
- Talent and lack of it. Attracting and keeping top talent might be difficult. Routine, the lack of industry exposure and limited flexibility are among the main disadvantages that in-housing brings. This extends from questions like who will manage your campaigns if your in-house resource is on sick leave to more strategic questions of keeping your digital marketing top-notch and not forgetting about the outside world. Advertising industry events, exposure to the ecosystem, access to beta-testing helps agencies stay creative, agile and ahead of the curve. The same should apply to your in-house team.
- Tech infrastructure and navigating the complexity is a concern that can be dealt with by auditing your tech stack and having consultants recommend the solutions that fit you best. When you own the keys to platforms, make sure the platforms are right for you.
What does it mean for agencies?
In-housing is not about the battle of advertisers vs. agencies. As pointed out by Belinda J. Smith, Global Head of Media at Electronic Arts, “Brands taking marketing, media or content in-house does not mean the apocalypse for agencies – quite the contrary.”
Agencies survive by adapting to client needs and by building winning teams. Therefore, bringing in an agency as an extension of your marketing team combines your internal knowledge with the agency’s digital marketing expertise. In order to achieve the best of both worlds, the agency-brand relationship should be focused on Return on Investment, trust, and operational transparency.