If there's one marketing trend that most agencies would love to see die off, it's the ongoing migration of marketing functions from outside agencies to in-house marketing teams.
Where did this trend begin? It's easy to blame everything on money; we know that the cost of outsourced marketing is one of the biggest concerns for CMOs around the world. But that's not the only reason brands are turning away from agencies and building up their in-house teams.
New technologies are expanding in-house teams' capabilities. By in-sourcing different elements of their marketing – such as digital advertising, creative, design and media buying – and combining this with the clever purchase of the right technologies, businesses are doing the following:
- Using emerging marketing technology to take back control of their brand's reputation and customer experience
- Becoming agile enough (thanks to technological advances) to navigate the lightning-fast modern marketing landscape
- Increasing productivity while decreasing overall costs
- Allowing for greater innovation and risk-taking
- Creating an in-house team with a deeper, more visceral understanding of the brand (which allows for more effective marketing overall)
As you can see, technology is what drives this trend. In-house teams are becoming more viable because of the emergence of new marketing technologies that allow those teams to reduce costs (especially compared to the cost of outsourcing to an agency).
Still, other factors are at play.
1. Passion and control
The Achilles' heel of every outside marketing agency is its inability to intuitively understand a brand at the same level as the brand's employees do. That's simply the nature of the business – it takes time for an agency to learn about a new client, become accustomed to brand voice and tendencies, and get a feel for management and the direction the brand's ambassadors would like to move in. Though many agencies can learn to navigate a brand effectively over time, they will always pale in comparison to an employee who lives and breathes that brand (and doesn't have the distraction of working for other brands).
The difference between good brands and great brands comes down to passion and control. Apple became great under Steve Jobs because he ruthlessly controlled every aspect of the brand and his passion for it was contagious for both Apple employees and customers. It was effective: Apple grew in ways that would simply have been impossible without his nuanced understanding and endless dedication.
That kind of passion resides only with the brand itself. When your in-house team is given access to technologies that allow them to leverage that deeper passion and greater level of brand understanding directly (rather than relying on outside agencies, as was done in years past), implementation skyrockets – because it's being guided by a wise, tuned-in hand.
2. Improved customer experience
Customer experience is similarly vulnerable. The customer is going to have a better experience in, for example, their social media interactions with a brand when someone who knows and loves that brand is managing the entire social experience. Another sad reality is that agencies will often hold back and refrain from taking even slight risks when creating marketing for a client. They will self-censor out of fear of losing a contract. Agencies will generally opt to achieve parity – to get the same results or slightly better – as a way of preserving the client while taking minimal risks.
The nuanced understanding an in-house team builds over years of work and experience allows them to come as close to the edge of permissibility as possible without going over it. This results in a brand that looks and feels more authentic – a quality that is hard to achieve, but customers know it when they see it. Further, in-house teams will always be more invested in the success of their brand, a natural extension and result of their greater understanding of a brand's image.
One of the major reasons brands sacrificed these obvious benefits in years past is straightforward: Not only did it once cost less to outsource, but marketing technology was at a point where specialized capabilities could often only be found at large, well-funded agencies. Control simply wasn't possible in any realistic sense.
But times have changed. Many businesses believe their costs have been rising for years. According to a recent study by Credo, agency rates are currently higher than they were during a 2017 study across all services, including digital marketing, SEO, PPC and Facebook advertising – and are still on the rise.
With agencies' less-than-transparent billing models, along with the falling costs and barriers to technology, control can finally return to where it belongs – the hands of the brand.
3. Higher speed, quality and productivity
Ultimately, the modern marketing landscape has behaved similarly to the rest of society in response to the progress of technology: It moves incredibly fast and requires amazing agility for brands to respond to customers in the timeframe the modern consumer demands.
This means brands need to be agile, but agility is not just a matter of speed; speed is a consequence of a number of factors. Agencies have lists of clients that they have to manage. They hide their processes and roadblocks from those clients. A client never really knows if the best marketer in the agency is working on a project or if it's been shunted to an intern (who will be working much more slowly and with a lower level of quality).
With an agency, immediacy is not really an option. Work usually flows around preset weekly meetings and an allocated budget. An opportunity or threat that needs to be dealt with on the spot will need to be waited out and responded to in the normal course of business. When you're playing in a dynamic and turbulent ecosystem, this can have a damaging effect on brand equity over time.
In-house teams are more agile because they know exactly who is working on what and can reallocate resources easily. They can ensure higher standards of quality and triage effectively because they're only worried about their own work. Because of this focus, they can be much more productive – as long as they have the right tools. When brands invest in technology, they may find that their teams can create content and campaigns faster than their old agencies ever could. [Looking for tech tools for your marketing team? Check out our reviews of the best social media management and email marketing tools.]
The in-house team provides complete integration. Everyone has the same goals, the same agenda. Problems can be solved quickly, and knowledge is retained and shared, which leads to more effective learning across the organization and improvement from one project to the next.
All of this results in one major benefit: Brands become more responsive to the marketplace. When brands gain greater velocity and effectiveness, customers feel this and become more loyal, more willing to become customers for life. The in-house team generates a quality that's hard to pinpoint and even harder to quantify, but it ties closely to the authenticity of the brand's voice and personality.
While agencies still have their place when in-house teams are overwhelmed and need temporary coverage, the advancements in technology that are spearheading the in-house trend ensure that agencies will only become less necessary over time. Brands that invest now in the right pieces of technology ensure that their in-house teams can grow and become more effective in the future.