In-House Agencies Now “Firmly Entrenched”

May 24, 2023

In-house agencies should no longer be referred to as a trend and have become “firmly entrenched” in the marketing ecosystem, according to a recent report [download page] from the ANA. In surveying more than 160 ANA client-side member marketers, the study found that 82% have an in-house agency, up from 78% the last time the survey was conducted in 2018, and from 58% a decade ago in 2013.

In fact, only about 1 in 10 (11% of) respondents said that their company has never had an in-house agency and is not considering opening one. The ANA forecasts that in-house agency penetration will ultimately peak at 85-90%.

The primary benefits of an in-house agency remain consistent from 2018, with cost efficiencies (87%) the most frequently cited, followed by better knowledge of brands (84%). This year a greater proportion of respondents than in 2018 are pointing to institutional knowledge (81%) as a benefit, with dedicated staff (72%) and greater control (71%) also seen as benefits by many.

When asked the primary benefit, cost efficiencies again emerged as the top vote-getter (30% share), ahead of better knowledge of brands (19%) and speed, nimbleness (16%).

With these benefits afforded, marketers are reporting strong satisfaction with their in-house agencies: fully 87% rated them a 5 (18%), 6 (45%), or 7 (24%) on a 7-point scale of satisfaction.

Notably, 92% of respondents also work with external agencies, suggesting that having an in-house agency is not a commitment that excludes external help. In fact, in a separate recent survey of agencies, 46% said that the new business they had recently won involved collaboration with in-house agencies.

Still, among those companies responding to the ANA report that have both in-house and external agencies, the in-house agency is handling the bulk of the work, at an average of 61%. This brings to mind a recent report, in which almost half (47%) of marketers said that the majority of their marketing/advertising activity is managed by an in-house marketing/advertising team, with this share up from the previous year’s report (39%).

Also of interest, almost two-thirds (65%) of respondents to the ANA study report having moved some business that used to be handled by an external agency to their in-house agency. However, this is down slightly from 2018, when 70% said they had moved established external business in-house within the previous 3 years.

Finally, these are the services that are most apt to be handled in-house, among those respondents with such an agency:

  • Strategic services: Creative strategy (76%) and brand/corporate platform strategy (52%)
  • Creative for digital media: Email (80%) and social media (78%)
  • Creative for traditional media: Collateral/promotional materials (83%), brand identity (72%), and internal company communications (72%)
  • Media planning and/or buying services: social media (41%), desktop video (31%), and mobile video (31%)
  • Other services: content marketing (60%), and data/marketing analytics (55%).

For more, download the report here.

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