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“In-housing is ‘more efficient’ than agencies”. So ran the Campaign headline announcing Unilever had saved €500m on marketing last year. And it proved a powerful launch point for the BIMA Brands Council’s recent roundtable on in-housing.
‘’In 2018,” announced Unilever’s Annual Report, “we generated savings in BMI of over €500 million. We are creating more content in-house while making existing assets go further. Our 16 U-Studios in 13 countries create brand content faster and more efficiently than external agencies. Improvements to measurement and verification of digital audiences ensure we maximise value in digital advertising alongside improvements in the measurement of influencer follower data.”
There’s a lot to unpack from that single paragraph, and at their recent roundtable, BIMA’s Brands Council set out to do just that, exploring agency perspectives on in-housing, the challenges in-housing brings with it and the potential value of the hybrid model. Here are the key points from the discussion.
Identify the motivations and objectives: Marketing cost reduction can certainly be one outcome of in-housing, as Unilever has clearly discovered. But it is just one outcome, and it’s important to identify others. Cost reduction won’t play nearly as well if the engagement, creativity, ROI etc diminish. No brand should be motivated solely by cost reduction.
Don’t replace one problem with another: Brands shouldn’t think of the agency/in-house question as an either/or scenario. If they do, there’s a danger they’ll replace one complex and costly set up with another, and replace old problems with new ones…
See what works: …Instead of treating the two options as entirely separate entities, try things out. See what works in-house on a small scale, then scale up. Where elements don’t work, leave that with the agency. No-one’s forcing brands to commit to just one route.
Keep lines of communication open: It’s important to have open conversations about what is and what isn’t working. Even at the end of the in-housing process there’s usually a role for the agency, for example in strategy, innovation or training. It’s important for agencies to remain constructive with brands, seeing the testing of the in-house space not as an erosion of their role, but an evolution into something different.
Talent retention: It can be a challenge for brand clients to retain creative talent. In-house media operations typically offer less of a network with fewer connections to external innovation. That can make it harder to offer career paths and staff can feel far more limited in their options.
Harder work: The in-house model can be a lot more demanding. You’re required to increase the value across all work, working harder to engage the audience.
Kool-Aid killers: Client-side people can be guilty of drinking the Kool-Aid – of blindly following in-house thinking without questioning or challenging – and that can kill creativity.
The importance of creative leaders: The idea that in-house is somehow code for ‘lacking creativity’ is wrong. There’s some fantastic work coming out of in-house – as the BBC, Channel 4 and Specsavers are demonstrating. But maintaining that level of creativity can be more difficult in-house, which is why having great creative leaders is hugely important to success.
Hidden depths: It’s not the four walls of your agency that make you inherently creative. Going client-side can be a brilliant opportunity to go deeper, understanding brand-specific pains and processes that you might never fully understand as an arm’s-length agency. That can have an extremely positive effect on brand creative.
Work/life balance: You’ll hear of a greater balance on the client side than in agencies. That can be a powerful tool in attracting talent, but the flipside is that it’s effectively an admission of how hard agencies work. That shows a unique agency culture of pride in their work and, despite the costs, it’s a clear statement of value.
Savings: There’s no escaping the potentially significant cost savings for brands that get it right.
A dedicated core: In the hybrid model, every client has a bespoke agency, a dedicated core team. As a creative you’re sat side by side with your client. You own the relationship with your client so you need to have a certain entrepreneurial spirit.
Agency culture: This model can help clients who struggle running an in-house marketing team, as you’re combining the two – it’s an in-house agency but run by an external company with an agency culture.
The pandemic has been a catalyst. It has highlighted the cracks and amplified the stars – the people you rely on. It has also created more time to connect with the wider industry, to develop personally, and there’s been more opportunity to be inclusive. But, we’re missing the loose informal sessions that allowed for bigger, freer thinking and the creative is suffering from being confined.
Agencies have been forced to become more agile and efficient. They have adopted new ways of working. There is a new level of discipline and those who are succeeding are doing so because they are flexible and adaptable. In a strange way, this new flexibility may benefit agencies as they attempt to work with brands seeking to bring at least part of the marketing in-house.
It’s important not to waste the benefits we have discovered during the crisis. As we come out of lockdown, how do we retain this new agility but combine it with all the positives of human contact? How do we continue to foster creativity? And how do we create a framework to work towards something better?