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By Alessandra Di Lorenzo
In-housing media continues to increase significantly but will that cover all media functions and what part do agencies still have to play for brands?
In-house media buying
….while a massive 59% of brands agree they will be bringing more media functions in-house, only a minority …. (17%) are considering in-sourcing media buying
The marketing industry is in a state of flux. From the way we interact with consumers, to our internal structures and business models, the way brands and agencies work is evolving. We have all seen examples of this change in action, especially with brands – from Lego to Unilever – increasingly choosing to take marketing capabilities in-house. But where is it all heading?
Here we’ll take a look at Media Sense’s eye-opening 2020 and Beyond report – a pulse-check of the current and future state of the marketing landscape – to see how in-housing plays into the future of media and marketing.
What does in-housing look like?
According to the report, while a massive 59% of brands agree they will be bringing more media functions in-house, a minority (27%) intend to do their own programmatic buying and even less (17%) are considering in-sourcing media buying.
These findings are no surprise to us. At Playbook, we know that every business is unique – and its in-housing journey should be too. When it comes to tech and programmatic, of course it doesn’t make sense for every brand to in-source this. Media buying, for instance, requires a huge investment in technology and expertise – and while for some this will pay off, for others it might not fit the bill.
The true value of in-housing is getting closer to customers and reaching commercial goals – and how a brand will go about this should differ depending on its specific circumstances.
Do agencies have a future?
Challenges such as reduced consumer confidence and spending, increasingly ambitious sales targets and tighter budgets have caused the in-housing trend to ramp up. As a result,many industry commentators have questions around the future of agencies. After all, if the brands take care of marketing internally, what’s left for the agencies?
Interestingly, Media Sense found that agencies have risen in brands’ esteem compared to a couple of years ago. Less than half (47%) of marketers say they will reduce the number of agencies they work with – 15% less than when they were asked the same question in 2017.
It’s clear that agencies still have an important role to play for most businesses. Our motto is that ‘if marketing is core to your business, it should be inside your business’ – and this leaves plenty of room for agencies.
Brands will continue to need agencies for their specialist knowledge and expertise, as well as their external perspective and creative thinking. And we have even seen this in action too – surprisingly, Lego asked its internal agency team to pitch against an external agency for a brand campaign, and the external agency won. As we go forward, we’ll see brands continue to engage with agencies, just in different ways.
With budgets remaining fairly conservative as we go into 2020, we predict that increasing numbers of brands will consider how they too can start their own in-housing journey – in pursuit of increased control, cost efficiencies and confidence in their marketing. And as both brands and agencies shift their operating models to find their unique solution, their symbiotic relationship will adapt, too. So, while we don’t know exactly what the future holds beyond 2020, we’re sure there’s a place for both brands and agencies to thrive, create and get closer to customers.
About the author
The views and opinions expressed are solely those of the contributor and do not necessarily reflect the official position of Producers & Procurers iQ or imply endorsement from the publisher