- Among marketers, 82% now use an in-house agency, according to recent research from the Association of National Advertisers (ANA) shared with Marketing Dive. That is a rise of 4 percentage points from 2018 and a major increase from 58% in 2013.
- Additionally, 88% of corporations reported having increased the workload for his or her in-house shop and 67% said the workload had increased “lots.”
- Respondents cited cost efficiency as the first advantage of an in-house agency, though other advantages include higher knowledge of brands, higher institutional knowledge and having a dedicated staff.
The increased use of in-house agencies reported by the ANA is a mirrored image of the brand new realities of selling, which has turn out to be reliant on actionable data and executional speed. In-house agencies can access an organization’s first-party data more quickly and more securely than external agencies, as an illustration. The survey, which is conducted every five years, had 162 respondents for its latest iteration.
Several ongoing shifts in marketing are evident within the study’s findings, including how the remit of agencies is changing. Nearly two-thirds of the survey participants said they’d moved some business that had previously been handled by external agencies to their internal departments. The most moved pieces of business were creative services for digital and traditional media.
As the in-housing trend continues to grow, ANA’s findings suggest that the ways marketers evaluate their in-house staff is evolving. Though cost efficiency stays the highest KPI, it has decreased in importance from 69% in 2018 to 62% in 2023. The KPI of business performance jumped significantly in importance from 45% to 59% through the same period.
While some respondents reported moving media services for social, search and strategy in-house, media itself still represents “the ultimate frontier for in-house agencies,” according to the ANA. More than half (54%) of in-house agencies handle some media planning or buying. Those who haven’t brought this functionality in-house cited complexity as a major reason for his or her reluctance.
The news isn’t all bad for external agencies, nonetheless. A overwhelming majority (92%) of the survey respondents reported working with an external agency, which is definitely a rise from 2018 when 90% reported working with external agencies. The reasons cited for working with external agencies included the necessity for extra bandwidth and capability when the interior agency is simply too busy in addition to handling areas for which the in-house shop lacks capabilities.
Moving forward, the largest challenge for internal agencies will probably be similar to that of external agencies: attracting and keeping talent, particularly as in-house agencies manage increased workflow while maximizing their efficiencies and resources, according to the report.
“This report definitively shows that in-house agencies have turn out to be a firmly entrenched a part of the holistic marketing ecosystem and are actually a mainstay amongst a majority of marketers,” said ANA CEO Bob Liodice, in a release. “Agencies still play a vital role for marketers, witnessed by the incontrovertible fact that 92 percent of respondents still use them. But the expansion of in-house capabilities has clearly modified the client/agency relationship over the past 15 years.”
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