In this year’s 2022 New Year Outlook survey we asked marketers and agencies about the use of in-house agencies.
With one exception, signs point towards the trend we saw in last year’s report: marketers’ reliance on in-house agencies seems to be on the wane.
We initially asked agencies “what percent of YOUR current clients have in-house agencies/do agency-like work in-house?”
To provide some perspective, in January 2020, 28% of agencies indicated that 51%+ of their clients brought agency work in-house, and in January 2021, it was only 14%.
In this year’s survey, the percentage remained low.
Only 17% of agencies reporting 51%+ of their clients brought agency work in-house.
In keeping with these trends, 77% of agencies expect either no change or a reduction in the amount of work being managed by their clients inhouse.
Last year’s report saw that number at 67%.
Overall, this is seemingly good news for agencies. The less work marketers are doing in-house means more work for agencies (in most cases).
Marketer responses seem to be fairly well-aligned with their agency peers as it relates to use of, and expectations of use of in-house teams.
We asked marketers, “what percentage of your marketing/advertising activity is managed by an in-house marketing/advertising team?”
Last year’s report saw 58% of marketers reporting more than 50% of their work was done in-house. This year, that number is only 39%, quite a decrease.
And when asked how marketers see the amount of work managed in-house changing over the next few years, last year the response was 36% saying it would not change or decrease somewhat to significantly.
This year it’s 63%!
In-house agencies aren’t going away of course. Your agency needs to know how to co-exist and work with in-house groups.
What does this mean for you, the marketer?
Why marketers are reducing in-house work isn’t completely clear. We suspect it’s either because they simply can’t find the talent, can’t keep the talent, and/or they find the talent difficult to manage.
I’m sure most marketers that initially thought to bring in the work thought there were huge cost savings – and I’m sure in some cases there were. But the reality is saving money isn’t the path to success. As my old boss used to say, “you can’t save your way to salvation”.
Quality of output and broad, strategic perspective are the central tenants to what a great agency can bring you. If you have a bunch of people sitting inside (just) your world, doing the same thing day in and day out…how do they bring new thinking to the table? And what good creative person would want to dedicate themselves to a single company. No fun for sure.
But all that said, many of you have in-house teams and will keep your in-house teams…and that’s fine. What’s key is making sure your agency knows how to work with them.
If they don’t know how to work with your in-house team, or seem to not really care about doing it, it might be time to find a new partner.
If you need help finding a new and better marketing agency partner, we can help. We help marketers find best-in-class agencies to meet needs that are either project based or larger, full-on AOR assignments. Give us a shout if you need help.