An external agency’s perspective on in-house teams
There’s a long-running debate over the efficacy of internal vs. external marketing teams. But the data doesn’t lie: the move by companies to bring more essential marketing activities in house is here to stay. Why?
Because it works!
In fact, when intelligently designed, the internal agency can produce exceedingly effective marketing for no other reason than it is internal. It brings teams—creatives, especially—closer to the business’ core strategy. It lets them interact with it. Work within and around it. It turns abstractions into the tangible.
This single point is crucial. Because one of today’s biggest marketing challenges is that creative outputs and their results are tracked to a “T.” Great ideas aren’t measured solely by emotional impact. They’re measured in dollars and cents. That’s why the ability for creatives to work side-by-side with executives and strategists is proving to be far more functional than just another “big creative idea.”
Now, here’s the thing: internal agencies aren’t for everyone. Larger organizations have a much easier time implementing them than SMEs and some mid-sized companies. It’s simply a matter of HR and other resources at their disposal. They can hire and retain more of the best creative talent available.
So, while internal agencies sound good in concept to SMEs, being able to afford to hire enough quality talent to generate effective output and consistent productivity remain ongoing challenges. But they’re NOT impossible challenges. In fact, as an external agency we often support and encourage the development of internal agency structures.
The goal of these efforts are not to make external agencies obsolete, in fact it’s just the opposite. There is great need for an external resource that is objective and not caught up in the weeds. Our goal of helping to build out internal teams is to simply ensure our clients experience the smoothest possible transition to a productive internal environment.
SHARED MARKETING IS THE NEW REALITY
Sharing work between internal and external agencies is practically essential to advance brands in today’s quickly evolving marketing landscape. When balanced appropriately, it delivers in-house efficiencies matched by quality thinking and ideas. Just look to the numbers for proof: The Association of National Advertisers reported that in 2013 nearly 58 percent of their members had internal agency capabilities. That figure had grown to over 78 percentby 20181*. It’s safe to say that America’s C-Suites are seeing the financial benefits of well-balanced internal/external marketing efforts.
Examples of this balance can be seen with many large brands. Walmart, PepsiCo and Unilever have all brought traditional and digital content creation in-house to better maintain brand control while also maintaining relationships with their external agency partners.
This shift to co-managing brands has given birth to new agency offerings—including ours—to set the foundation for an in-house agency. As a creative consultancy we can deliver the infrastructure needed to provide quicker, well-informed turnarounds that perform better.
The inevitable decision our clients and other businesses embarking on similar routes must make is what marketing activities to maintain control of and what responsibilities to contract to an outside firm. To arrive at an educated answer to this question, you first need to consider a few factors surrounding your marketing efforts.
THE PROCESS TO IDENTIFY THE BEST COMBINATION OF INTERNAL/EXTERNAL EFFORTS
You’ll need to consider your budget, expected ROI and marketing goals first. Having deep insight into and understanding of these areas will simplify your decision-making when determining how to balance your agency/in-house team combination.
To start, it’s crucial to consider the capabilities you’ll need from your in-house team. How many marketing activities do you plan to hold on to? How many hours and staff will it require to execute the work? What will their capacity to take on new work be? And most importantly, how will you scale your strategy, driving continuously improved results that maintain and enhance brand relevance? You’ll want to avoid building an in-house team designed to be “heads down” creating without an eye toward goals, the future or new opportunities for your brand.
Answering these questions will help you either build or determine if your in-house team has the chops to execute a results-driven strategy, and when you’d want to bring in an agency to work alongside your team.
TRUE PARTNERSHIP IS KEY
We’ve witnessed the importance of true partnership many times over. They’re key to the success of a balanced internal/external agency approach. Because all organizations are themselves unique, they often design unique workflows that blend internal and external resources to spur business growth while maintaining speed and managing marketing spends
Companies are now also expanding how they make their decisions. They’re looking beyond quicker turn-arounds and cost efficiencies. They’re analyzing how brands build higher, and demand the business acumen needed to truly understand and interpret the data behind that growth. This gives companies the ability to problem solve with fresh approaches while avoiding stale pitfalls.
At the end of the day, a CEO wants to be sure the solution they land on will be built with clear roles and responsibilities, and a spirit of collaboration that ensures egos and agendas will not and cannot impact performance or distract the business.
THE IN-HOUSE OPTION
To establish this teamwork, you need to look at your marketing goals and measure them against the work required to achieve them. You’ll want to strategically break these factors down to ensure both internal and external teams are assigned the work that best matches their skill sets. Ultimately, these teams sitting in the right “seats” is what will lead to your success.
To better understand these “seat assignments,” first ask yourself if your marketing plan and strategy requires high-volume output. Do you produce multiple versions of one ad, with sizing or messaging that constantly changes? Do you run aggressive digital ad buys or spend time bidding on SEM terms that require constant management and refinement? If your answers to these and similar questions are “yes,” then hiring a team of affordable production, media, research and creative specialists potentially makes sense for your business. Following this route, you’ll need to consider salaries (e.g., a designer with five years’ experience commands an average salary of $45,677, per Glassdoor) and perks/benefits. Prepare to calculate how much talent you’ll need, then outline your projected ROI to ensure you’re designing a team with a full view into the costs and needed output, as well as an understanding of its creative, strategic and sales abilities and limitations.
It may sound costly, but there’s a huge upside to this approach in that an internal team will be able to commit all of its energy to better understanding your brand, your competitors and internal systems and processes. In addition, having your team in the office and available to you at all times allows you to adapt and make changes on the fly. Many companies place tremendous emphasis on these benefits when they factor in what work to bring in-house.
WHAT’S DRIVING THE INTERNAL PUSH & WHY?
A recent example you may be familiar with comes from Intel. The chipmaker successfully built and put to work an internal marketing agency between 2015 and 2018. Intel embedded creatives in sometimes unexpected places, like around leadership discussing core business strategy. This is one of those examples of an abstraction transformed into a tangibility, and it led to some of the company’s most compelling storytelling. Intel employed strong creative leaders who designed workflows that created an omnipresence that provided the Intel team the velocity to learn, adapt and create assets that added real business value to the organization. It also delivered a team that was immersed in the company’s culture and understood both its rational and emotional components.
Other companies began building stronger internal teams after the General Data Protections Regulation (GDPR) came into effect, which gives consumers more control over the information businesses have on them. Once GDPR passed, companies began bringing a lot of their digital and data marketing in-house. This movement returned more of these companies’ ability to target their audiences and create real-time engagements in their social media, digital and CRM campaigns. To be clear, an external team could have accomplished much of the same. But to do so at the same speed would likely have come at considerable cost and coordination.
Internal teams can also be designed to better handle the fast-moving retail and collateral work that most external teams weren’t built for (nor are often overly interested in handling). But over the past few years, internal teams have become so agile they’re now executing more than ad resizes and digital engagements. These teams now often implement complex video projects—those which might otherwise be too costly and time consuming to meet the growing video content needs most companies require to compete.
THERE ARE CONS…THE PROS OUTWEIGH THEM
For many organizations, an internal marketing team is a boon to its branding efficiency and efficacy. But for all the “pros” of internal marketing, there are “cons” to contend with too. They don’t need to be gamestoppers. But you do need to be aware of them when establishing your internal marketing team.
What many organizations have found is that having their team work on only their brand leads to a stagnation, and a lack of fresh ideation. Companies have to find ways to avoid insular thinking from their internal teams. Too often, they get caught in “ruts” and resort to what’s familiar (or worse—gets approved quickly) and stop pushing their own ideas.
Building these internal teams also takes considerable time and effort. You have to hire the right people at the right salaries and then, more importantly, be ready and able to scale your teams as business grows. The Intel example cited previously fell prey to this pitfall. While the internal team was deemed “creative,” the efforts to build and sustain it were too costly, leaving it unable to keep pace with the company’s expansion. By 2018 Intel had begun dismantling its team to free up resources for outside partners who could scale as quickly as the business was expanding.
Another common pitfall to having only an internal team is vulnerability to overwork and high turnover. Don’t overburden your team, or you may find them leaving you—along with everything they’ve learned from you.
If you’re a large organization with a well-defined brand/brand style guide, money to invest in building your team and heavy volume and speed-to-market needs, an internal agency presence is a smart move. Fortune 500s often find that their in-house teams move faster for about 27% less investment than their external partners. But for a SME with a limited budget, it’s much harder to find these same efficiencies.
YOUR COMMON-SENSE STRATEGY FOR A SEAMLESS EXTERNAL AGENCY PARTNERSHIP
Considering the pitfalls above, where, how and when does a balanced internal-external agency partnership work the best? A seamless partnership with an external agency is filled with “pros.”
Looking for support in developing your to-market strategy? Does your plan require high-level research, creativity and quality of execution? Then a close external partner can be your key to unlocking your business’ and team’s full potential. Outside-of-the-box thinking is why agencies exist—and it’s contagious.
These and other benefits result from one of a few simple truths: working in a corporate culture typically limits unconventional thinking. And that limits your chances of getting the highest level of creativity out of your team. Working with an external team, meanwhile, gives you access to myriad expertise and insight. And because agencies work across diverse industries, they’re exposed to a wide set of new trends that encourages fresh, timely and attention-getting ideas.
Managing creatives is also a task many organizations overlook when deciding to establish an in-house solution. Most quality talent in the market doesn’t give much consideration to in-house job postings. They realize the limitations working on one product presents to their portfolios. Without quality talent, it’s extremely difficult (if not impossible) to get high-quality, brand-differentiating ideas.
Intel (our example again) learned this while attempting its in-house agency efforts. The company found recruiting difficult to keep up with, and that talent occasionally couldn’t meet the company’s in-house needs (which was handling up to 70% of its marketing). With an enormous workload and creatives focusing only on one product type at a time, maintaining enthusiasm and adequate staffing levels became detrimental to Intel’s initial ROI. The external agencies Intel eventually signed, meanwhile, were able to continuously attract the top talent needed to deliver the scale and quality Intel demanded.
This is why the solution for many organizations is to divide responsibilities between in-house and external teams. The internal agency typically focuses on executing day-to-day high-volume activities. The external partner focuses on executing campaign and activation ideas. This division results in speed and budget efficiencies neither team could likely manage on its own. The reason is simple, but often overlooked: agency pricing is attractive when it’s focused on your bigger strategic needs that happen once or twice a quarter. Contracting those services typically costs far less than hiring full-time researchers, data scientists, strategists and high-level creatives.
This is nothing more than economies of scale at work—you won’t be your partner’s only client. And this won’t be their first time at your rodeo (or, at least, one somewhat similar to yours).
EXPLORE, UNIFY & FLOURISH
Today, internal and external resources continue to vye for their place in the marketing ecosystem. Internal teams are proving to best own the day-to-day planning and management of their brand. Where an external team can bring to the table a talent pool that is steeped in global data, research and the newest trends, strategies and creative approaches.
And while in-house team members are working to control their data, output and resources, many of the companies they work for still feel they have a long way to go before adding true value to these marketing facets. So, this is an opportunity for external agencies to partner with their in-house counterparts to provide support in understanding how their data connects. What it really says. And then find new approaches for using this data to help advance the organization’s goals.
All considered, in-house marketing teams and external agencies have an incredible opportunity to make more meaningful and, more importantly, impactful work. External teams need to acknowledge that in-house teams are crucial for advancing the brand—in essence, the in-house team is the client and in control of the brand. And in-house teams have to be comfortable working with external agencies that play critical roles in keeping them inspired by and informed about the latest tools, strategies and creative approaches.
As a unified front, both in-house and external teams can, should (and already do!) work together to deliver high-quality marketing with the speed and cost efficiencies that will allow their businesses and brands to flourish.
by: Tracy Donofry and Dave Moore