In-housing is not living up to marketers’ expectations

The overwhelming majority of marketers plan to continue in-housing resources despite new research highlighting key concerns about relying on internal functions over external expertise.

In-housing has been a hot topic over the past couple of years as marketers look to reduce costs and increase efficiency. But what works for some brands won’t work for others, and in many cases in-housing is falling short of companies’ expectations.

Increased productivity is a major draw for 47% of marketers, for example, according to new research by the Data and Marketing Association (DMA) and Mailjet. But just 32% of brands are happy this objective has been achieved.

Likewise, 38% thought they could improve creativity as a result of bringing processes in-house, but only 27% believe this has happened in reality.

The top outcomes brands hoped to achieve by in-housing include cost saving (57%), better brand consistency (53%), better control of campaigns (48%) and improved decision making (46%).

Yet, in all cases in-housing has failed to live up to expectations. While there is just a four percentage point gap between marketers’ expectations and achievements on cost saving, there is a seven percentage point gap for brand consistency, a nine percentage point gap for improved decision making and a two percentage point gap for control.

Despite the outcome gap, just 9% of those that have tried in-housing say will not continue with it in future. The vast majority of brands (86%) are currently in-housing some aspects of marketing and will carry on doing so.

According to the research, future in-housing will focus on acquiring key skills within teams, including data analytics (40%), search (37%) and online ad buying (35%). By bringing these skills in-house, marketers hope it will help boost business growth (25%), improve productivity (20%) and be a better use of budget (19%).

Challenges and concerns with in-housing

Although marketers are looking to in-house more functions, they raised some key concerns about relying on internal staff over external expertise.

These include being trapped in an echo-chamber with no outside perspective to innovate (37%), too many people being involved with no clear process (37%) and the fact it could mean deadlines are pushed back or missed (35%).

Another concern for just under a third of the 200 marketers questioned (29%) is the fact no one will question proposed campaigns or strategies.

This risk became a reality for Pepsi when it launched its now infamous Kendall Jenner campaign in 2017, which was developed by its in-house creative team.

Pepsi’s ad failure shows the importance of diversity and market research

The research confirms in-housing is more than a short-term trend, but the performance gap in a number of areas shows it has a way to go to prove the benefits of having everything exist under one roof.

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Knowledge Bank

Comments

There are 2 comments at the moment, we would love to hear your opinion too.

  1. Anne Miles 5 Aug 2019

    The real issue is in brands thinking that the whole thing needs to be done in-house and no longer seeking the top strategic minds. The truth is that the deep, independent thinking that drives business growth is still available to them as an agency would offer and then the internal team do the implementation. The agencies don’t even have this resource in-house a lot of times either and call on category and skill specific freelancers – it is just under the hood and not visible to clients. They really can have the best of both worlds.

  2. Richard Fullerton 13 Aug 2019

    Interesting. I didn’t know the Pepsi debacle was due to that dumb ad being originated in-house. There’s no doubt that agencies have better minds to call up for strategy and better resources to implement most campaigns. They’ve also got the sign-off and pressure-test processes. But some aspects are best done in-house e.g. Adword campaigns.

    The difficulty is fees. Agency fees have been ground down over recent years and my feeling is that brands often don’t want to pay agencies a retainer, just employ them for projects. That is cheaper for brands but very disruptive for agencies. Trouble is that when agencies try to charge a premium for project work – as they should – my feeling is that clients baulk at this.

    Unless of course you’re a PR agency in which case clients are regularly hoodwinked into paying retainers and have no idea of the ROI. I’ve been in the wrong discipline I think. It should have been PR!

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