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Agencies must ‘shift’ attitude to in-housing: IPA report | WARC | The Feed

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05 July 2023

Agencies must ‘shift’ attitude to in-housing: IPA report

In-house agencies Developing client-agency relationships Strategy

A new IPA report explores the development of in-housing strategies across brands and categories, and urges agencies to engage with the trend, both to help grow client accounts but also to find new opportunities.

Why it matters

Doing business in 2023 is about adjusting to far tighter cost controls, and some brands will choose to prioritise in-house capabilities. For agencies responding to this challenge, the IPA’s new report, Shift Happens, seeks to highlight the areas that agencies need to be able to answer and improve on.

Four key lessons

From campaigns to always-on experiences: Agencies need to transform digitally, the report finds. Increasingly, agencies must be able to work with, or plug-in, customer data using automated processes to ensure that their models keep pace with advances in technology and with the growing number of in-house agencies that have these capabilities.
In-housing is now established in the marketing operation: In-house capabilities are increasingly normal and intrinsic to marketing; helping the client means working with agencies. “Agencies can replace trepidation with optimism,” the report says.
From efficiency to building businesses: Clients increasingly cite effectiveness rather than simply efficiency, the report finds. Agencies should clearly define their role and build robust methods through which to measure and communicate their value.
Exclusivity to integration: Agencies need to shift from being vendors of marketing services to “integrated partners”, the report adds, arguing for an inside-out understanding of the client business. Though this, of course, requires the client to think the same of their external agency.

In context

“[F]or agencies to ensure they remain critical players in the marketing ecosystem of the future, they must continually assess the changing requirements and indeed capabilities of their clients,” comments Christian Byron, chair of the IPA’s commercial leadership group and COO of OMD UK, in a statement.

In-housing has had a chequered history. Its first opportunities looked to media efficiency, before many brands found that their professional media agencies enjoyed far greater economies of scale; big creative, too, has proved hard to execute by an in-house team. A recent ANA report in the US, meanwhile, found the practice of in-housing to be extremely pervasive, mostly because of cost.

But the IPA report suggests that the UK marketing scene is different, with technology questions at the heart of the discussion. “The old, linear processes are now dynamic, providing additional opportunities to deliver creative work. Agencies who embrace the power of technology to transform their businesses will be the ones who survive and thrive,” says report co-author Janet Markwick.

The method

Shift happens, by independent consultants Rhona Glazebrook and Janet Markwick on behalf of the IPA, is based on a series of in-depth interviews with agencies, intermediaries, new entrants, in-house organisations, procurement specialists and clients, to understand the landscape.

Sourced from the IPA, WARC