In-housing no longer a trend

An ANA report finds that 82% of member respondents have an in-house agency, with cost savings one of the strongest reasons for favouring internal teams; but external agencies stand out for capacity and capability.

Why it matters

The report notes that in-housing is no longer a trend but a fact of life for the vast majority of firms surveyed, with cost efficiencies the most commonly cited primary benefit (see chart). But external agencies are still critical for creativity and media capabilities.

Creative in the spotlight

Still, agencies should be aware that cost and speed are increasingly the preserve of in-house teams and are therefore a less interesting area in which to compete – creative expertise, meanwhile, ranks lower down the list.

Effectiveness concerns increasing

What’s interesting, however, is the trend away from cost savings as the main measure of performance – it stood at 69% in 2018 and is down to 62% – while business performance is now a similar measure of effectiveness for 59% of respondents.

Key ideas

• Historically, in-house agencies have been about being “cheaper” and “faster” but not necessarily “better” than external agencies.
• Over the past three years, 65% of respondents have moved some established business that used to be handled by their external agency(ies) to their in-house agency (mainly creative services for digital and traditional media).
• Media, too, hasn’t seen the same in-house rush as the industry had imagined back in 2018, with only a third of respondents having some of their programmatic capabilities in-housed.
• Media planning and/or buying services are handled in-house, at least to some degree, by 54% of respondents. Those who have considered bringing media in-house but have not yet done so point to the fact it is “too complex.”

Sourced from the ANA