The number of marketers with in-house agencies has grown substantially over the past five years among members of the ANA (Association of National Advertisers), according to an ANA survey.
The study, “The Continued Rise of the In-House Agency,” revealed that 78 percent of ANA members reported having some form of an in-house agency in 2018, compared to 58 percent in 2013 and 42 percent in 2008, the last two times the survey was conducted. For 44 percent of respondents, their in-house agency was established within the past five years.
In addition, 90 percent of 2018 respondents said the workload of their in-house agency has increased in the past year, including 65 percent who said the workload has increased “a lot.”
The survey revealed that in-house agencies provide a range of services, including strategy, creative for both traditional and digital media, and media planning and buying. Services that have grown significantly over the past five years include creative strategy, media strategy, social media (both creative and media), and programmatic media buying.
“This report makes clear that the work being done by in-house agencies is no longer confined to ‘low-hanging fruit’ such as collateral/promotional materials and internal videos,” said ANA CEO Bob Liodice. “Traditional agencies are becoming increasingly challenged as marketers move more work in-house while encouraging their external agencies to provide differentiated services and increased value. We expect the current trends to continue, with accelerated client movement to in-house agencies.”
Respondents said that cost efficiencies were the primary benefit of moving agency services in-house, followed by better knowledge of brands, speed and nimbleness, and institutional knowledge.
Respondents overwhelmingly (79 percent) expressed high levels of satisfaction with the work of in-house resources, with 37 percent indicating they were “completely satisfied” with the work being done by these teams.
While marketers are turning increasingly inward — respondents said more than half of the total amount of work (58 percent) is done in-house — the survey nonetheless also showed that 90 percent of respondents still work with external agencies.
Additional Findings
- Over the past three years, 70 percent of respondents have moved work formerly handled by their external agency(ies) to their in-house operation, including content marketing, social media, and influencer marketing.
- 79 percent have in-house video production capabilities, and almost half (49 percent) established their in-house production capabilities within the past five years.
- Top KPIs used to assess the effectiveness of in-house agencies are cost savings, speed to market, and business performance.
- The biggest challenges for in-house agencies are related to managing growth. Specifically, the two top challenges are managing workflow (increased projects) and efficiently managing resources.
Specialty Services Handled In-House
The study also indicated that there has been a marked increase in the amount of specialty services offered by in-house agencies in the past five years. For example: Content marketing is handled in-house by 75 percent of current respondents compared to 34 percent in the 2013 survey, while data/marketing analytics are handled in-house by 59 percent of respondents versus 42 percent in 2013.
In addition, several specialty services not provided as options in the 2013 survey are now being handled in-house. These include influencer marketing (39 percent), experiential marketing (38 percent), and commercial production (22 percent).
The ANA survey was conducted in August 2018 among 412 ANA client-side marketers (i.e., not agencies or media companies) without prior knowledge of whether they already had an in-house agency.
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