ANA 2023 Study Edition: "The Continued Rise of the In-House Agency"
In its study released earlier this year, the ANA, the largest marketing trade association in the United States, reported that 82% of the 162 companies it surveyed now had some type of in-house marketing agency, up from 78% in its last survey in 2018, and nearly double the rate of 42% in 2008 when the surveys began. The ANA predicts the percent of firms having some type of in-house agency will ultimately peak at 85-90%. For those with in-house agencies, the workload increased 88% in the past year, so not only do more firms have in-house agencies, the amount of creative work they are doing is also increasing.
Top reasons given by firms for bringing work in-house were the abilities of internal agencies to:
- Produce more work, more cost effectively and quickly
- Better understand their customers and the types of creative and programs that generates the best response
Because the ANA research was fielded in February and March 2023, the full impact of GenAI on in-house marketing workloads, processes, and task distribution was not yet apparent. My hypothesis is that GenAI will further accelerate the amount of marketing creative work done in-house.
Andrew McKechnie,former global design head at Apple, and Verizon’s first creative leader & founder ... [+]
To better understand the magnitude of the trend and how to inspire the best work from in-house teams, I spoke with trailblazing pioneer, Andrew McKechnie, former global design head at Apple, and Verizon’s first creative leader and founder of its in-house agency “140” during a transformational period when it was evolving from a telco to a tech company. The in-house agency name was inspired by Verizon’s first building at 140 West Street in Manhattan.
Going back decades, Steve Jobs’ vision, unique at the time, was to maintain in-house creative control across a wide spectrum beyond product, to include packaging, store design, merchandising and signage, the website, outdoor billboards, content, and more. It was a way to ensure integration, consistency and control of all aspects of the brand experience, and to maximize privacy and secrecy relative to major new product and creative initiatives.
Given the expanded role of CMO’s today that requires intense focus on performance metrics, in-house creative teams are increasingly taking on a supporting role as brand custodians with a holistic purview across all company brands and marketing vehicles. They oversee new creative development, and ensure ongoing compliance with guidelines relating to brand identity, brand voice, and design elements.
In the past 10 to 15 years, the creative core of where talent sits has shifted. There has been a democratization of creativity outside agencies, and working in an in-house agency no longer has the stigma it once did. It can be an important part of a creative career, broadening skill sets and perspectives. Andrew rapidly ascended through the ranks in advertising at agencies like BBDO and Modernista! before going brand side where he took on the roles of Global Head of Design Group at Apple, and Senior Vice President, Chief Creative Officer at Verizon.
The first marketing services brands have typically brought in-house are CRM, Retail and social media content. Andrew recommends starting in areas that have the greatest impact, visibility, customer touch, and ability to scale. In Apple’s case, examples include photography, design, interactive, and retail stores.
He also recommends that the creative leader has a seat at the executive level. It’s important because it…
- Signals to the entire organization that senior management at the highest levels supports the work of the in-house agency and will advocate for them
- Speeds decision-making, and creative strategy and priority alignment
- Enhances in-house agency culture and makes attracting talent easier
- Clarifies the role of the in-house agency and reduces the threat perception by internal marketing teams and external agencies
It’s important for the entire organization and external partners to understand that the vision and role for the new in-house agency is to partner in the development of new, big ideas, and ensure consistency of brand imagery and messaging. Traditional agencies continue to perform the work they do best, such as large tentpole events, commercial production, experiential live events, and brand partnerships.
As Andrew shared, “If the in-house team is not successfully integrated structurally or aligned with the broader business objectives and ambitions of the company, it’s difficult to demonstrate its value and it quickly becomes a group no one is willing to fight for. Without a leader, who has a shared voice with other groups, or has the necessary support to build its competency, the agency simply gets thrown into a cycle of unrealistic timelines, pressure to do more, faster, and an inability to maintain quality control, for which they will also be penalized.”
Andrew believes talent is a company’s greatest innovation and that creativity and culture go hand in hand. A great, inspiring, supportive culture is the critical path to great creative work. Building the right culture for creativity to flourish is a full-time job. When things go awry, it’s often because the focus on cost-cutting grows out of balance. Key areas of focus of the chief creative officer are knowing how to spot talent, foster excitement and energy, and inspire authenticity. As Andrew says, “The Team Is The Heart”.
Just like with new products and services, you need to keep iterating and experimenting with how in-house agencies work. They need to be flexible and keep adapting based on new learning and changing business needs.
When Building The Most Effective In-House Agencies Andrew Recommends
1) Shifting primary focus from cost efficiency to delivering high-value expertise that can support and drive innovation across the company
2) Hire creative leaders who can foster a culture of creativity. Creative talent is a rare breed and an invaluable asset to a company
3) Develop clear strategies and processes for integrating in-house teams into existing organizations
4) Build a hybrid mix of support with in-house talent and external capabilities to solve complex challenges
5) Build a flexible talent pool that can shift based on changing market and business needs
6) Demonstrate top management support and make sure the in-house agency’s role in relation to other internal marketing departments and external agencies is clear and unambiguous
7) Foster diverse talent and build a team with varied life experiences to energize and inform the work and culture.
