It can be difficult to know how much of your marketing and advertising should be carried out inhouse and how much you should outsource to an agency.
We will be looking at inhousing your marketing and whether it can work for your business. Here’s what we will cover:
- Highlighting both the advantages and disadvantages of taking your marketing inhouse
- Defining what an inhouse agency is
- Explaining how an inhouse agency works
- How the inhousing structure can work for your business
Agency vs Inhouse Marketing
When making your decision you need to carefully consider the pros and cons of each. How might this impact the performance of each advertising channel?
Essentially, businesses have three choices:
- Outsource everything to an external agency
- Bring everything inhouse; potentially establish your own internal agency division
- Utilise a mix of inhouse staff and agency specialists
Examples of larger companies that have decided to bring everything inhouse and establish their own internal agency include Coca Cola, Lego, Netflix and Amazon.
These companies have modelled their inhouse agency on the typical structure of a marketing agency. The key difference being that these agencies have only one client. As you might expect there are numerous advantages and disadvantages to this model. As an agency that helps businesses take vital digital services in-house, we feel we are best placed to offer a non-biased view on the matter.
|Cost||No economies of scale|
|Control||No shared learning|
|No conflict of interest|
The Advantages of inhousing
When you work with an agency, not only are you paying for their staff, but their overheads and a mark-up so they can make a profit.
This is not the case with an in-house agency, meaning that the cost of running in-house advertising is generally lower. The mark-up you’d pay to an agency can instead be invested in talent and advertising spend.
With that being said, it can be more difficult to manage inflating costs when running your own inhouse team; sometimes it is easier agreeing on a set fee with an agency that is easier to forecast over time.
Agency staff are often required to split their time across multiple clients and campaigns. While this helps with knowledge-sharing and experience, it can mean that your advertising campaigns don’t receive the proper care and attention you might like.
In contrast, managing a full team of inhouse staff with one client means that your entire workforce is dedicated and focused toward the same goal. This laser-targeted focus on a single cause can mean increased productivity.
It can sometimes be difficult to exercise control over your marketing activities when these are spread across multiple agencies and departments.
Managing everything in-house means complete control over your advertising spend, marketing activities and strategy.
Agency teams are often positioned as ‘an extension of your own team’.
The reality can often be quite different – and despite working in a digital age of interconnectivity, it can be difficult to ensure efficient lines of communication.
An inhouse agency will likely work out of the same offices, with all the same lines of communication that exist within your business. This can make it easier to conduct internal meetings and prevent any potential breakdowns in communication that may lead to marketing issues.
5. Company Values
Hiring an inhouse marketing team means taking on a team of people who are fully embedded within the company – and who therefore understand company values, culture and philosophy.
Agency staff will also have a better understanding of your product and service than would be possible with an external consultant.
This will be reflected in the quality and performance of your marketing campaigns.
This should also make it easier to motivate your team, who will likely feel a better sense of dedication to the brand than if they were hired as an external agency.
6. No Conflict Of Interest
When you outsource work to an external agency, the agency may have existing relationships with one of your competitors (or they might establish new relationships without your knowing).
Usually agencies will utilise separate staff to prevent any cross-over, but it’s difficult to justify working with an agency where they may be a conflict of interest.
Taking your agency activities in-house can negate any conflicts and help to ensure that the team working on your account is fully dedicated to the end-cause.
7. Attracting Talent
It may be something of a generalisation but there is a trend of more experienced workers moving from agency to inhouse roles.
If you are a prestigious, well-recognised brand then you may find it a little easier to attract the best talent to your business. This talent is also then owned within your business – rather than being rented temporarily.
The Disadvantages of inhousing
8. No Economies of Scale
Big agencies benefit from economies of scale, including lower costs for industry tools, advertising costs and business overheads.
These savings can sometimes mean that working with an agency is actually more cost-effective than taking the services inhouse.
9. HR Headaches
There are undoubtedly HR headaches that come with hiring your own inhouse staff, including employee retention, shortage of talent and candidate screening. Not to mention that each employee will require resources for management, benefits and potentially agency fees! When you work with an agency, this becomes their problem to deal with – which takes a real load off of your plate.
It’s definitely worth checking out the true cost of an employee (or employees) before making a decision either way.
10. No Shared Learning
Inhouse teams often work in-silo on your account. While this may have productivity benefits, it can result in tunnel vision and it’s easy for your teams to become insulated from industry developments.
In an agency environment, there is nearly always a lot of shared learning – whether that be via industry updates or campaign case studies that are shared with the wider team. Successful campaigns are shared across business accounts, thereby benefitting everyone in the agency. This experience and knowledge are then utilised by the agency staff that work on your account.
If you do take your marketing activities inhouse, you need to make sure that learning and development is a continuous consideration for your agency team.
11. Limited Skillsets
Even if you hire some of the best candidates in your industry, it’s unlikely you’re going to be able to match the wealth of skills, resources and experience available to a large advertising agency. The advantage of an agency partner is in the sum of their parts – the range of disciplines they are able to bring together as a coherent service.
You should consider carefully what skills and experience you’re likely to miss by bringing one or more advertising channels in-house.
Inhouse training advantages and disadvantages
So, when it comes to training your team, is this something you should do inhouse?
As we’re sure you gathered by this point, there are both advantages and disadvantages when choosing to train inhouse. Ultimately, it’s the decision of the business leader as to which works best but here are some of the core benefits and downfalls on inhouse training.
|Travel cost savings||Admin for internal team to deliver|
|More specific examples and case studies||May not be taken as seriously|
|Customisable sessions||No chance for networking|
|More convenient||Pressure for colleagues to deliver|
|Good for team building||Lack of industry awareness|
Which is best for your business?
Ultimately there is no one-size-fits-all solution. Both inhouse and agency solutions have both positives and negatives. You should consider all variables before you make your decision – including costs, budgets, talent pool, HR implications and more.
If you’re still confused – speak to us about our inhousing consultation. We can help you decide which elements of your marketing you should look to inhouse and help you make the transition seamlessly.