The Rise of the In-House AgencySeptember 5, 2013
By Bill Duggan, Group EVP, ANA
ANA has released a new report, “The Rise of the In-House Agency,” and the findings are most interesting. Highlights:
The penetration of in-house agencies has increased 16 percentage points, to 58 percent, from our last survey in 2008. Also, there has been an increase in the number of employees on staff at in-house agencies.
- These increases are, in part, a reflection of the economic environment in which corporations have reduced budgets and are being challenged to do more with less. Moving the agency in-house — or increasing the role of an existing in-house agency — can help reduce costs.
- The growth of digital/social/mobile and the need for quicker turnaround for those media has played a role in the increased penetration and responsibilities of in-house agencies.
The services handled by in-house agencies are varied.
- The most commonly handled service by virtually all the in-house agencies surveyed is creative for collateral/promotional materials. Email, tradeshow/event materials, and direct mail are also widely serviced by in-house agencies.
- Half of all in-house agencies handle some level of media planning and/or buying.
- Newer media — specifically, social media, online display advertising, and search engine marketing — rank high on the list of media services handled in-house. In fact, when asked an open-ended question about the biggest changes in their in-house agencies in the past year, a significant number of responses centered around newer media.
In-house offer key advantages and appear to be growing in stature:
- Cost efficiencies are still the most often mentioned advantage of in-house agencies, although the percentage of respondents naming costs as the primary advantage has declined significantly since the 2008 survey.
- While quicker turnaround time is also a major benefit, other factors such as institutional knowledge and having a dedicated team have grown in importance since 2008. This indicates that in-house agencies are increasingly more sophisticated and strategic, not just “fast and cheap.”
Traditional agencies are being disintermediated to some degree by in-house agencies. A majority of survey respondents say that:
- They have moved established business that used to be handled by an external agency to their in-house agency.
- They have assigned newer functions, like digital/social/mobile, to their in-house agency rather than to an external agency.
The full report is available onthe ANA website.
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