When big brands such as Optus and CUB bring creative work in-house — along with some other retail and services brands currently rumoured to be doing the same — the rise of the in-house studio or internal agency resurfaces as a controversial topic.
It’s a hard-fought battleground: on one side are the independent creative agency staffers and freelancers, decrying the drop in creative standards they say will inevitably result; on the other, the smart marketers who know that in this day and age, they really don’t need to pay $100 to have a word in the headline of an ad changed, and they don’t need to wait 3 days to get it done.
Cost, creativity and responsiveness are typically the main fronts along which the arguments for and against the in-housing of creative work are fought.
You see the dichotomy played out in the oscillating attitude of individual brand owners. There appears to be a revolving door on retailer Myer’s in-house, outsourced approach to digital creative: when Clemenger won the contract to supply digital creative services, the in-house team moved out-of-house to LogicalMagic — a bespoke operation set up for Myer but housed off-site in Clemenger’s offices.
Similarly, Optus established its new Yes Agency in-house last year, two years after making some internal creative resources redundant, citing a desire to be more nimble and agile.
Some brands, such as Foxtel, have taken a point of view and committed to it, developing a hybrid model that marries the benefits of outsourced brand advertising with in-house production.
And brewer CUB more recently launched an in-house digital agency to work alongside its current agencies.
The potential upside is clear: creative resources on-hand, enabling fast-turnaround work required for digital, content and social marketing to be executed quickly and cost-effectively.
Sportsbet, for example, produces 400 pieces of work a month through its in-house creative studio.
And for big retailers such as Woolworths and Coles, dedicated bespoke agencies are becoming increasingly more difficult for traditional agencies to compete with.
But there are some common reasons for why in-house operations sometimes fail and those resources are sent outside, again. Here are 3 of the common reasons we see:
1. Focus on cost savings rather than value creation
If your internal creative agency is dubbed ‘Creative Services’, many internal creative agency managers would argue it’s a mistake.
Not only does it create a master-servant relationship, where the creative resource simply provides the services requested by internal stakeholders, but there is often little focus on value creation.
If the only reason to bring creative in-house is to save costs, those savings can all be realised in year one. What happens the following year?
Then there’s the issue of charging creative resources out internally within the organisation. When that doesn’t happen, no one knows the value of the work being produced compared with what it would have cost to outsource those services to external providers.
Also, internal agencies must be established with a clear remit linked back to how the agency is funded. That gives them the authority to say ‘no’ to internal stakeholders if their requests for work are off-strategy or low-priority, as determined by the funding authority within the business. So, if the budget is coming from marketing, the work must be considered a priority by marketing.
Otherwise there’s little way of justifying the head count when the chief financial officer wonders what all those extra people in marketing are doing.
2. Poor marketing work management practices
Internal creative agencies tend to bring into harsh relief any inefficiencies in marketing workflow that may already have been there.
To flourish, internal creative studios and agencies need good technology platforms for managing their workload, backed by clear, defined, well-understood processes.
Managers need the ability to prioritise, allocate and track work. They need to be able to accept or reject briefs. A unified workspace that enables feedback to be collated in one place is essential, particularly if work gets reallocated between different internal agency staff.
In worst-case scenarios, creative resources are wasted because the cost of using those resources is invisible; bottlenecks are not addressed, lead times stretch out and costs increase with no clear benefit to the business.
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3. Creative work gets stale
External creative agencies know how important it is to train staff in new disciplines, technologies and emerging channels as required, as well as keep up-to-date with popular culture as it affects their offering to customers.
The ability to work on more than one brand also keeps staff fresh, and prevents them from ‘drinking the kool-aid’, thereby preserving their ability to see the brand through the eyes of a consumer.
But training is often neglected in internal creative agencies. And it’s a rare in-house agency — with the exception of those attached to media and entertainment brands such as Foxtel and The Star — that can offer the variety of work that keeps staff approaching their work with fresh eyes.
In some cases, hybrid models that involve the circulation through the internal agency of different staff is a possible solution.
No one-size-fits-all in-house agency model
In fact, every brand that sets up an internal creative resource will do so along slightly different lines, depending on the nature of the work required.
Simple has some customers with high-turnaround digital production requirements, and others with a focus on marketing collateral, while still others are called upon to localise national and international messages.
Creative agencies will always have their place in the brand marketing ecosystem. But increasingly, marketing teams need the structures, tools and processes to support the creation of marketing content and campaigns in-house.
To learn more about how Simple’s intelligent marketing resource management platform can help your marketing team reduce complexity and be more effective, Book a Demo.