TRANSCRIPT
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Robert Berkeley 0:06
We're going to do this edition of Inside JobsInside jobs a little bit differently. We've got a number of guests. But we want to talk about the state of the industry survey sort of come out towards the end of 2018. And first of all, I want to introduce Emily Foster, who is the Ddirector of the In House Agency in house agency forum orwhere IHAF have. And first of all, welcome you on the podcast. Emily.
Emily Foster 0:31
Thank you, Robert, I'm excited to be with you. A as always.,
Robert Berkeley 0:34
Yyou've had a very busy 2018, as usual, but it the towards the end of the year, you issued your state of the industry report, and it was widely picked up I remember, the Wall Street Journal ran a piece on it, first of all, and from there, it sort of turned into a bit of a news frenzy, certainly in our industry. What do you think we're really got people talking, Emily,
Emily Foster 0:56
Tthe study that you're referencing, it is In House Agencies in house agencies today, which is a 26 page report that really details the functional competencies, service offerings, project composition, and operating practices of today's In House Agencies in house agencies. So we had a total of 325, unique companies respond, which I think was a great response pool. And one of the things that really helped to validate our data, and this, this group of respondents included, both internal agencies, external agencies, as well as client side marketers. And it's a study that we fielded in partnership with Forrester Research in 2018.
Robert Berkeley 1:34
Okay, so I kind of assumed being In House Agency in house agency for him, you'd only be looking at your members in the In House Agencies in house agencies, what was the what was the rationale behind it, opening it up to external agencies.,
Emily Foster 1:45
You’re you're right, that's something that we've never typically done. We have over 10 years of data here at IHAF I have, and it's all solely from the perspective of in US agencies. And while that data is certainly valuable for our members, it's really equally valuable for us to not only understand how inos agencies are seeing themselves, but also how they're perceived by external agencies, and their business stakeholders or clients internally. So pulling all three of those groups meant that we were able to ask a question like, what are the advantages of having an In House Agency in house agency, and assess what In House Agencies in house agencies consider to be their leading advantage, as well as what client side marketers are thinking? And with even more general questions, like, has the perception of the In House Model in house model changed in recent years?, Wwe were also able to compare those responses by audience type., you're more
Robert Berkeley 2:36
Why’s that important than to do it by audience type?.
Emily Foster 2:39
Well, here at IHAF I have, we really focus on delivering content and cultivating community to therefore enhance and influence the impact of corporate advertising and creative organisations. But to do that, we really need to understand In House Agencies in house agencies from the inside out, and the outside in. So if all we were doing was reading the trade press, we'd assume that external agencies are threatened by the growth.
Robert Berkeley 3:05
A lot of chatter about that,
Emily Foster 3:06
yYeah. And client side, marketers might believe that In House Agencies in house agencies are only here for getting the work done fast and cheap. by gathering data by audience type like we did, we were able to see how internal agencies perceive themselves, and also how they're being perceived by their colleagues on the external agency side and by their clients. And what we found is that In House Agencies in house agencies have more supporters than detractors. Clients are valuing In House Teams in house teams for their knowledge of the business and knowledge of the brand, above cost and speed. And the most surprising piece of data, I think we found was that external agencies are seeing Iin house teams more as a compliment than a threat. And none of that's reported in the news. But it all came through very loud and clear in our data set.
Robert Berkeley 3:52
I think that's a very interesting point and uncertainly, seeing a lot of what we might have even regarded as traditional agencies, coming to events that are around In House Agencies in house agencies, and certainly taking an active part not just an interest, but an active part in that word. What Sso when we when we started, I talked about the fact that you were also you mentioned that you worked with Forrester on this report. But back in 2008, you were you did this with the ANMA, I think, right?
Emily Foster 4:21
That's correct. We fielded a similar survey in the past with the ANMA.
Robert Berkeley 4:25
As you know, this episode of Inside JobsInside jobs will have interviews with the ANA AMA and with Forrester, I want to get as wide a perspective as possible and leading In House Influencer in house influencer.
Emily Foster 4:34
That's great, Robert, and I'm excited to hear what everyone has to say. I look forward to the episode.
Robert Berkeley 4:39
Me too. Let's get on with it, shall we?
Emily Foster 4:41
Let's do it.
Robert Berkeley 4:48
Joining us now is Jay Patterson, Principal analyst at Forrester Research and co author of the recent field report in titled unleash the potential of In House Agencies in house agencies. Welcome to the podcast, Jay. Hello, thanks for having me. It's a pleasure, I've got a bunch of questions I'd like to put to you, in light of the recent report that you conducted with the in house agency forum seem to attract quite a bit of attention, as I recall.
Jay Patterson 5:12
Yeah. a fair amount of tension, both, you know, inside the the forester ecosystem, but also out in the press, as well, you know, the In House Topic in house topic is is been a hot one with the research. That was that was reported from I have followed by, you know, some additional research coming out of the ANA AMA. And then this report, there's, there's been a lot of talk in the marketplace among CMOS, and among agencies, in particular, about what what this all means, you know, and how to best use an In House Agency in house agency to your benefit?
Robert Berkeley 5:47
Well, one of the things that you suggest or that you take away from the report, is that CMOS talking of which need to mature their thinking, and their investments, which is quite an assertion. Have you received any backlash from CMOS on that? Or do you think they they agree with, with what you're saying?
Jay Patterson 6:08
That well, both. I mean, certainly, it's, you know, it's a somewhat mixed reaction, the backlash that we've seen, the disagreements are that, that really assert the notion that, that these agencies play a specific function, and that they, they play a function of, you know, providing efficiencies, compared to what CMS would be paying their agencies, it's, it's part of the cost management strategy that's in place right now, inside of marketing. And what I mean by that is that our Forrester data shows that the CMOS marketing budget costs and fees for technology in particular is increasing substantially. And as as CMOS take on more of a role in, in providing digital experience for their companies almost, you know, products and services that spend around technology, you know, as a requirement, and.
Robert Berkeley 7:10
And when When you talk about social content, or just merely kind of product, collateral descriptive content, well, I think maybe shared socially,
Jay Patterson 7:18
It’s it's, it could be social content, but but you know, think of it in terms of just apps, and, you know, in digital experiences for customers, you know, via their websites, or connecting their ecosystems together, sometimes referred to as digital transformation. And, and as these, you know, marketing and communication are a part of this, but they're not all of this. And so, marketing and communication have to share the the budget and the cost, you know, has to be it has to be read across both of these or all of this activity, in order to do so the CMO has to find efficiencies, and they're finding efficiencies in their agencies. And one of the ways that they're finding efficiencies in the fees that they're paying to their agencies is by paying their In House Agencies in house agencies less.
Robert Berkeley 8:02
So you're saying that that's a primary draw a driver for for the growth that we're seeing?
Jay Patterson 8:07
I think it is part of the it's part of the growth that we're seeing. And it's certainly part of the pushback that I get, when when I suggest that to get the best marketing in the best digital experiences that CMOS need to pay their agencies more, both their external agencies and their internal agencies.
Robert Berkeley 8:24
So if I was to ask what you felt corporate marketers or CMOS ought to be doing better to enable the success, do you mean they need the thing they should be doing is increasing their budgets to do better work. Is is definitely part of it. Do you think they're held back by budgets that they have In House Agencies in house agencies, but they're constrained?
Jay Patterson 8:43
I believe that the part of the if we look at the data, but the Forrester data and and the the I have data, what we see is, you know, some limitations in skills, and we see limitations in resources. And I think that those would tie back to the other the allocation budgets or the chargeback budgets that are that are occurring inside the In House unhealth Agency agency. You know, we know with external agencies that there they're oftentimes where the fee doesn't really cover even the you know, the agency's costs that came out about two years ago, when there was audits looking internally in the in the media supply chain. And I would suspect it's the same thing in house. And so when we adjust and right size, those those those budgets, then it allows for more resources, it allows for expanded skills, it allows for talent development, or acquiring better talent. And, you know, so it all I think it all ties back to the economics and the economics tie back to the fact that marketing has to do more today than just communicate and just campaigns
Robert Berkeley 9:53
to CMOS need to allocate more budget I guess, to get more support from the In House Agency in house agency and to Get the best from them. Another another takeaway is around creative talent. And maybe this is related in some way. But you point out, I think an imbalance between high concept work and production projects, that these In House Agencies in house agencies are allocated. Clearly production is something that is very often expected to be In House Agencies in house agencies. But do you think that in terms of the high concept in terms of the creative, the pure creative, they can go toe to toe with with external agencies? increasingly, it would, it would appear that that's the case.
Jay Patterson 10:41
Increasingly, it would, it would appear that that's the case. You can see that in the in the IHAF I have data, where I believe it's about 30% of the the creative product that it's coming out of the In House Agencies in house agencies right now. Or original creative. So that's, you know, that's no small part a third of their work, developing high concept ideas, you know, anecdotally, you can, you can see a number of, you know, high profile television campaigns that are being produced by by In House Groups in house groups, you know, most notably, some T Mobile work aimed at, at veterans and military service, some Unilever work as well. And our Forrester data even indicates that Creative Services and creative concepting is a shared function between, you know, both in house and external agencies. So it certainly all indicators are that the creative is improving in house and that, that, that myth of, you know, it's be talent that, you know, to be put out to pasture is just, just not true.
Robert Berkeley 11:49
Well, to that that list, I must add a recent Inside Jobsinside jobs guest, which was the cooler at Experian their In House Agency in house agency led by Todd Miller, also, again, producing absolutely world class broadcast advertising as well.
Jay Patterson 12:05
Yeah, and that's why, you know, I mean, when you see something like the news that Intel from just a couple of weeks ago, where Intel's had a strategy shift and is moving to, you know, a different, a different strategy for, you know, its marketing to be more more b2b centric, and less and less direct to consumer. And thus, they're, you know, they're shifting their allocations and the resources in their, in their In House Group in house group, but their In House Group in house group was, you know, was was providing fantastic work, you know, great television work, great digital work, you know, just another example of, you know, an In House Team in house team that, you know, absolutely, as you say, can go toe to toe with any external agency. Absolutely. In fact,
Robert Berkeley 12:45
Absolutely. In fact, I interviewed Teresa just the other day, and that obviously came up.
Jay Patterson 12:50
And there was a point, you know, and perhaps we're belabouring this, but there's just a point that, you know, which, you know, Intel, you know, was doing a lot of the below the line work in house, but still had, you know, you know, still had a creative agency to do some of their, you know, their television campaign work that, then they even took that, you know, that chunk of it in inside. So it really, you know, it's it's a great resource. And, you know, it's a shame to see a group like that, you know, be affected by a strategy change. But
Robert Berkeley 13:18
if you don't see this as the beginning of a trend, do you think this is an outlier one off that that happened to suit this particular company at this time?
Jay Patterson 13:25
Well, I don't know that it's necessarily the beginning of a trend, I think it's just an example of the reality. And the reality is that this isn't, it's not an either or thing. It's not, you know, we shouldn't we shouldn't be necessarily thinking of these, as, you know, pitting an In House Group in house group versus the external agency, the reality is that they both suffer from the same, the same issue that they they are, they're underfunded, and they're under resourced entities right now, because the marketing dollars are so spread across campaign and technology, and, you know, so as a result, they, they shouldn't be fighting for work, they should be collaborating. An example of that. One of the things that we know about In House Agencies in house agencies is that they're, they are, they're fantastic at understanding the business and, and understanding the brand. They're theirs, they're very close to the business. They're oftentimes, you know, just a couple of cubicles away, they're there, they're ingrained in it, you know, and, and spend a lot of time involved in it. Well, that asset and that advantage combined with a media specialty, for example, or media expertise, that you can find inside an external agency is a really potent combination, to be able to take the intricacies of the brand or the intricacies of the business and combine that with with some specialisation that might not be you know, found necessarily in an in an In House Agency in house agency. So that that that combination is really Really important aspect to that not every organisation can be all things. So there's some things that they're, they're stronger at the brand knowledge is a, for example, for analysis, one, speed of execution is another, again, you know, people that are in the same building, you know, a couple of desks away, you know, maybe maybe the next building over just the, the ability to be very agile in the way that they work responsive, just because of their locational advantage, you know, speed of execution is another brand knowledge all, you know, really important attributes, you know, for the, for the, for the In House Group in house group, and admittedly some economic advantages can be had. But in the, in the external agency, what you're getting is a perspective, you're, you're finding people that are have this kind of, you know, detached, objectivity, you know, they're not so close to it, they're a little bit more consumer centric, if you will. And so it's a nice, you know, it's a, it's a nice yen to the, to the Yang of brand knowledge. You know, specialisation was another thing that, you know, that we've talked about. These are in the external agency, they're, they're working with, across multiple brands, multiple categories, they're exposed to a lot of the latest technology and a lot of a lot of the emerging emerging technology, space, and all of that specialisation is is is a really useful asset for their the agencies to bring and to share.
Robert Berkeley 16:34
Well, so so over the recent years, well, past decade more that there has been more and more companies looking to insource, some or all of the brand building and the various aspects. We've just touched on there the various aspects of In House Agencies in house agencies. What's the next frontier? What do you think's coming up next year? And beyond? Jay Sanjay? The crystal ball? Yes, please. put the battery in and power it up. Yeah.
Jay Patterson 17:04
Yeah Well, I think we continue to see an interest in the in housing of of media and programmatic media. And the research would indicate that somewhere between 20 to 25%, of In House Agencies in house agencies are, are playing in that in that territory. So it's not a small amount. But it's certainly not the core competency, that Creative Services and production is. So I think this year, we will see that continued interest in, in digital media and programmatic media specialisation, I think what we'll find, however, is that it's a very complicated and costly proposition. complicated, in the, in the sense that, that that type of specialisation that, you know, to work with those platforms that that that programmatic trader mindset is, is is a in demand skill. And, you know, already the, you know, the agencies are investing heavily to train that and in retain that, and so, the In House Groups in house groups will have to, then the CMO will have to will do the same in order to achieve that, and it's really kind of brings us kind of full circle, which is, you know, if we're looking to the game, in digital, and in programmatic media, then it comes back to investing because you've got to invest in the experts, you've got to invest in the talent, and you've got to invest in the technology to do that. And so consequently, I think we have been seeing and we'll continue to see marketing groups that that attempt to insource some of their programmatic media execution, but find that it's a really difficult process to do so, and may only get a couple of steps into it before they start to change their mind or start to recognise the, you know, the the reality of it. And also, I think we'll also see, we'll also see some of that moving back out into the external agency world as a result of that. So I think it
Robert Berkeley 19:16
So it sounds like there's a sort of equilibrium that you're kind of moving towards where the right strengths are played to external or internal, sometimes a bit of a swinging backwards and forwards around that., I think so because
Jay Patterson 19:28
I think so because it's a it's a comp, it's a complicated space, it's one that you know, that it's constantly moving, I mean, just even for me to talk about it is, you know, is a, it's a result of, of, you know, hours and hours and hours and days and days and days and months of research. Just just it's a moving target. And consequently, for a marketing group or an In House Agency in house agency group to you know, to take on such an endeavour is a really significant undertaking. And and, you know, at 64% penetration, which is, you know, the is what are our research with a half demonstrates there's room, there's, you know, I don't think there's room for growth, but I think it's gonna be in specific areas. And I suspect it'll be some media, but it'll be more in in digital marketing, you know e commerce CRM, you know, digital development, kind of more on the creative side creative and production side around of digital and digital marketing and some media growth.
Robert Berkeley 20:32
Excellent. Jay, thank you very much. Indeed, if people want to get a copy of this report, how can they do that?
Jay Patterson 20:38
If they are clients of Forrester, they can find it at @forrester.com. And if you're a member of IHAF I have, you can go to if forum.org and download it there.
Robert Berkeley 20:49
Excellent. Splendid. Well, Jay, thank you very much indeed, for your time and your insight. And those hours and days and weeks and months of pain, taking pain. I was gonna say painful, painstaking research. And your painful. I'm sure it's sometimes it's but sometimes pleasure. And thank you very much for your time.
Jay Patterson 21:07
Thank you. I appreciate your inviting me. And it was a pleasure to come on and speak with you today.
Robert Berkeley 21:20
With us now is Bill Duggan. Billy's group Executive Vice President at the ANA A N A, which we all know is the Association of national advertisers. Bill's group is responsible for the newly released continued rise of the In House Agency in house agency report. And we're pleased to have you with us, Bill, thank you so much. But build it that the report itself has obviously garnered a great deal of interest in the trade press and actually beyond as well. Right.
Bill Duggan 21:43
It this report has gotten more activity than anything ama has done this year. And when I think about my ama tenure that now spans 18 years, we did a fairly famous report on media transparency in 2016 that garnered a tonne of press. But in my eignet tenure, the In House Agency in house agency report is second only to media transparency.
Robert Berkeley 22:10
Well, that I mean, the reverberations of the first one of those is definitely still still being heard by everybody. But in terms of your a, your your your In House Agency in house agency report, it's the third time you've done this, I think I've said here you did it with I have in 2008. And then you did it again in 2013. Right.
Bill Duggan 22:29
So following that pattern, 2008- 2013, it just made sense to do it in 2018. So yes, we've done it. Now three times. And, you know, the the broad takeaway is the incredible growth of in house when we did it once upon a time in house penetration was 42%. That was 10 years ago, when we repeated the survey five years ago, it had risen pretty dramatically to 58%. And then when we did the survey this year, it had grown to 78%. It didn't surprise me that the growth was robust. But what did surprise me was was how robust it was, you know, I would have thought it would have been in the low 70s. But to be at 78% was quite astounding.
Robert Berkeley 23:21
What do you attribute that to the bill? Well, I
Bill Duggan 23:24
Well, I think I think there's, you know, two legacy reasons in two new reasons. So the legacy reason for in house, or around cost and speed. So you know, In House Agencies in house agencies are known to be cheaper than external resources, as well as faster because they're closer to the decision makers, their house that the client, so things are faster. So if you ask client side marketers is cost important. The answer is always Yes. Rather than in the best or worst of times. If you ask client side marketers is speed and the jelly agility important? I think you'll always get a yes as well. So again, those those are the two legacy reasons for for in house. And then I think that there's two new reasons and we are already briefly talked about one and that is transparency that the ANA AMA k two report released in 2016, you know, really shone a light on some of the transparency issues between external agencies and client side marketers. So I believe that a the need for greater transparency has been a reason that in house has accelerated. And then the other new real reason is data. So I think data has become probably the most popular four letter word in the advertising industry. And there is some overlap with transparency here as well, but clients want to you know, keep and protect their data. They want to make sure that data that they control the portability of data. So in other words, if you're working with an external agency that manages your data, and if for some reason that relationship ends and you go to another agency, sometimes there are issues with you being allowed to take that with you. So buy in housing, issues around portability, go away, because that's with with the client. So again, it's always been about speed, and cost. And the new reasons have to do with transparency and data.
Robert Berkeley 25:34
Interesting. So it's kind of the those four items could make a perfect storm, I guess, and drive the growth of this. You talked about cost there that interests me, because you seem to be saying that cost is important. But also, other issues like speed are important. Can you value the speed itself? And compare that to the cost and make a sort of balanced decision? And is there a potential downside to the expectation around it just being a savings play?
Bill Duggan 26:02
Sure. So let me let me address speed first. So I think a great example of, of in housing, where it relates to speed is with social media. So we've seen many of our members take social media in house. And social media is a real time medium, you know, we're you know, responding to news events, responding to consumers. So what we have found is with members having a team of social media experts in house, they're just quicker, and they're closer to internal legal counsel. So in the event that social media posts need to be approved by a lawyer, the clients being in house can do that a lot quicker. So I do think that social media is probably the best example of how in house and speed has has become a great benefit.
Robert Berkeley 26:58
But in terms of the expectation that we'll bring in house and saves, save money, is there any knock on effect of that? Do you think?
Bill Duggan 27:06
Yeah, yeah. And that's a fair question. So it's, it's rare that a client would hire an outside agency, with the primary reason being cost, of course, cost is always a consideration. But you hire outside agencies for the creative firepower that they provide, and the ideas that that they provide in this strategic thinking. And ideally, there's a there's a value relationship between those services and the costs paid. So you can't just go in house, because it's cheaper. That, and one of the things that we've seen is that, again, the typical reasons for in house have been cheap and fast. And there's this triangle that that many of us have been schooled with, where there's three points of the triangle, fast, cheap, good. Pick two. So typically, for In House Agencies in house agencies, it's all been about fast and cheap. But what we've seen increasingly, and I think that this is something that was different in the 2018 report versus previous reports is that we're hearing from many stakeholders, that the work of In House Agencies in house agencies, in many cases is very good, and in many cases on par with external agencies. So
Robert Berkeley 28:26
why did the why do we hear reported in the press about quality concerns from In House Agencies in house agencies? What's going on there? They being exaggerated.
Bill Duggan 28:34
So so so who's reporting that is an external agencies or is it press?
Robert Berkeley 28:40
Is that a rhetorical question?
Bill Duggan 28:43
Yeah, you know, I think that that's, that's been a knock on In House Agencies in house agencies forever. So it's, it's, it takes a while to kind of shed baggage. So, you know, I would firmly agree that historically, the quality of the work has been a critique that some have had of In House Agencies in house agencies. But again, I believe that's changing. So so we're not all the way to bright yet. And there's a wide spectrum of work among In House Agencies in house agencies just like there is among external agencies. But again, I think the headline here is his work is improving and in many cases, on par with external resources.
Robert Berkeley 29:22
You also touched on this a little bit earlier, but there is a constant discussion, he go to any conference and you will hear this discussion about whether external agencies should be threatened by the rise of the In House Model in house model. It sounds from what you just said that you feel the answer to that is no, correct.
Bill Duggan 29:44
I think the answer is to some degree. So let me let me explain that because I think the ideal relationship between external and internal is an end AND AMD relationship rather Then or so, in our research, one of the questions we asked is, among those respondents within In House Agency in house agency, do you also work with an external agency? And 90%? said, Yes, I was actually surprised that number wasn't even higher. I thought that number would be close to 100. But But I was, but but again, 90%. And then we asked the question, among all the work done, both in house and externally, what percentage of that work is done in house? And that was a fill in the blank question. Again, we said the work we didn't assign budgets to it, or the level of work, it was kind of worded so much generically. And that amazingly, was 58%. So that that's quite a statement, you know, out of all of the respondents that have both in In House Agency in house agency and an external agency, 58% of the work is done by the in house agency.
Robert Berkeley 30:56
So what do you think you'll be reporting as headlines in in 2023? And by the way, I'm looking forward to interviewing you then and checking.
Bill Duggan 31:04
That that that would, that would be great. So So I do think we'll see the continued advancement of In House Creative in house creative. And maybe at that time, we'll be talking about some awards that some of the In House Agencies in house agencies have won that there's been some awards at Cannes or elsewhere, that have been, you know, taken in house. I hope that we hear more about the partnerships between external agencies, internal agencies, because I do believe that the, to a large extent, and I'll choose my words carefully, but I think a large extent that that there are many in the agency community that that see in house as a threat, again, how could you not, but but I also believe that the more progressive agencies are finding ways to see this as an opportunity. I'd actually like to read a quote that, after the ANA AMA report was published in agency, who will remain nameless, wrote to me, and said the following. You know, we're excited about the ANA AMA report. And in housing, because we see this as the direction the market is moving. We believe we can help companies make this transition, and are eager to build out our product offerings for companies that are planning to bring services in house, or have already done so. And I believe that you'll see other agencies with similar thinking in the future.
Robert Berkeley 32:38
Indeed, that's true. That's true. So Bill, thank you very much for your time. And anyone who hasn't seen the report so far, how can they get hold of a copy of it? Sure.
Bill Duggan 32:47
Sure. There's a vanity URL that is open to anyone. It's ANA.net/inhouse eignet dotnet, slash in house, no hyphen on in house. So ANA.net/inhouse a and a dotnet? slash in house?
Robert Berkeley 32:58
Super at once again, thank you very much for your time, Bill. Yeah. My pleasure. Thank you.
Joining me now is Marta Stigman stigman, organisational strategist and consultant to some of the leading In House Agencies in house agencies in the country. Loyal listeners will recall Marta from our very first episode of Inside JobsInside jobs. We're happy to have you back, Marta. Thank you, Robert. I'm delighted to be back. So we've been hearing from some of these people in the know about the state of In House Agenciesin house agencies and the model. Just then Bill bill Duggan, of course of the ANA AMA. And before that we heard from Forrester foresters Jay Patterson Jay patter Sol seems that from what both of them say that In House Agencies in house agencies are on the rise.
Marta Stigman 33:45
That's true. You know, I think if we look at the arc of the penetration of In House Agencies in house agencies from 10 years ago to five years ago to today, it's clear that insourcing is not a passing fad. I worked closely with the ANA AMA, in fact, on their 2008 and 2013 studies, and then more recently with IHAF I have and Forrester on their 2018 reports, when the first day in a study on the state of in house was field to 10 years ago, it was around the time the US economy was failing. And corporations were really looking for any way to save that they could. So a rise in insourcing wasn't necessarily headline news. If we fast forward five years with a strengthening economy, then guess what, even more Corporation started to jump on the bandwagon. And now all of a sudden, it was headline news. Because Why were these companies continuing to insource if there was money to go back to outsourcing. And now 10 years later, with an even more robust economy as the backdrop we see that the movement to develop and produce content campaigns internally, really continues to grow. So it's not all about saving money. That's a piece of it. But there's much more to sourcing of advertising and marketing services. There's a lot more to determining what combination of resources is His right to best meet the needs of any given business.
Robert Berkeley 35:03
Well, that combination also includes what appears to be a growth in the in the partnering with external agencies. Right?
Marta Stigman 35:11
Definitely, I think there's a lot of mixing and matching going on. So even with the growth of the In House Model in house model, as you said, the wide majority of corporate marketers recognise that in order to produce competitive compelling campaigns, that their objectives are really best served by coordinating resources that are both inside and outside the company. So that data, the assumption that these options are mutually exclusive has all but faded away. What hasn't changed, unfortunately, is the debate over which is better. And honestly, that's the part that needs to fade away.
Robert Berkeley 35:46
It's not binary, it's Shades of Grey,
Marta Stigman 35:48
It isit is Shades of Grey, and when the ANA AMA is 2013 report came out, there was all kinds of press about which one is better internal or external agencies. And as the In House Model in house model has continued to gain popularity. You know, the mudslinging, quite honestly, has, has continued as well, like some sort of a battle being waged, I mean, I get it, even in an up economy, marketing dollars are still very closely managed, and everyone wants to make sure that their organisation is funded. The truth of it is that regardless of whatever ugliness may be playing out in the trade, press the data. And what's actually happening inside these companies tells a very different story. And that is that internal and external agencies are finding some really great ways of working together as partners. Both groups have similar interests, talents, resources, so working together, as opposed to being threatened by one another, is really what's going to help both agency types thrive. It's the only way to optimise the corporate marketing dollars that both groups share. And it's in everyone's best interests to find a way to work together.
Robert Berkeley 36:58
So the fact that you're saying that In House Agencies in house agencies are obviously on the rise, they must work with partners in the external agency arena, surely that means there's greater competition for creative and, and production operation talent, right?
Marta Stigman 37:14
Talent talent is a big deal for sure. In fact, that's maybe the biggest deal. And for me, it starts with making sure that the talent on your team knows the business and the brand. And combining that with equal knowledge of the business of advertising and marketing, old and new. In House Agencies In house agencies are supposed to be experts in the corporate brand. In fact, that's one of the benefits of having an In House Team in house team. Unfortunately, too many in house agencies hang their hats on brand alone, it's equally important to become an expert in all lines of business keeping pace with everything from history and size and philosophy of the business to products pricing distribution channels to the current competitive landscape and climate. And from there, the objectives of the business how the audience is defined, what the best ways are to engage the target. That's where your advertising and marketing expertise then kicks in, you need to know what levers to pull, and how to pull them across assorted media, including measuring results in market. And using those insights to drive next generation strategies. All of that is table stakes. The thing that In House Agencies in house agencies get pinged for time and time again, when it comes to talent is this idea that they're not as creative as external resources. And honestly, that comes down to who you hire, and how you manage them, you can hire the most inventive creative mind out there. And if you put that person on a short leash, or have them doing below the line work, the majority of the time their creativity will wane. Creativity is like a muscle it needs to be nourished and stretched and exercised in order for it to perform at peak. So it's about knowing the business as much as your clients do. Understanding the brand and how to bring it to life at every point of contact in the marketplace, knowing the business of advertising and marketing, because that's the business you're in. And then investing in the best creative minds and muscle that you can and not being afraid to flex that muscle as often as you can. Fear, I think is one of the biggest things that holds us back from letting creativity manifest in house instead of being afraid of what might happen if you let it loose. I'd be afraid of what will happen if you don't.
Robert Berkeley 39:33
Yeah, yeah, absolutely. And looking into the future. Do you see this as a particular challenge that people will face or are there other challenges that are on the horizon?
Marta Stigman 39:44
Um, you know, I think the greatest I'll recast it as an opportunity. I think the greatest opportunity for a lot of In House Agencies in house agencies today is to define what they are, who they are, what they do, and just as importantly, what they are not who they are not and what they don't do. Far too often, these organisations are defined by those around them, and not defined deliberately enough or confidently enough by those within the In House Agency in house agency themselves. So the opportunity is not to let your In House Capability in house capability or operating practices or rules of engagement, be defined by those who sit outside of the organisation, evaluate the needs of the business. And from that set of needs, determine what you can commit to delivering with excellence, then formulate a model and a team and operating practices that enable consistency of that delivery and clear everything else out of the way. corporate executives really play a part in this in that they need to get behind a much more deliberate intention for the In House Model in house model, whatever that intention is within their respective companies. I've written about this, in fact, a number of times, including the intro to the 2018, IHAF I have report, and there's a need for the C suite to stop looking at the In House Agency in house agency as a savings play and start looking at it as a corporate strategy. So my advice for overcoming the challenge that you're asking about Robert, which is essentially future proofing your In House Agency in house agency is to declare who and what you are, who and what you are not, and then formulate a structure and hire a team that enables you to be the best possible version of that, that you can be ensuring alignment and support from the top every step of the way.
Robert Berkeley 41:37
You know, one of the biggest challenges most frequently cited challenges I hear from listeners to the Inside Jobsinside jobs podcast is how do I how do I get corporate to take me seriously include me in in not just marketing strategy, but marketing, tactical requirements? Are you saying that the a way to do that, if not, the best way to do it is to is to ensure that you are able to have a world class team doing something very focused, not trying to be all things to all men, but trying to do something particularly well,
Marta Stigman 42:18
I think you have to be selective about what you do and what you don't do, and hit a mark of excellence consistently. If your charter as an In House Agency in house agency is to be a production service provider be the best production service provider you can be if your charge is to be the agency of choice that can work on everything from broadcast to PowerPoint development, be that it's a matter of defining again, who you are and what you are, and going after it with a vengeance, committing to it and gaining the commitment internally, and an executive level to support the headcount and infrastructure and operating and engagement practices that will enable that to happen successfully and consistently at a high level.
Robert Berkeley 43:11
Go to Marta, very wise words, as ever. Thank you very much for sharing your expertise with us. Are you at the creative leader summit in Chicago in April?
Marta Stigman 43:21
I am planning to be there. Yes, I'm excited to be it's the IHAF I have leadership summit on April 11, in Chicago, hosted by McDonald's Corporation at their new corporate headquarters., and
Robert Berkeley 43:31
And they'll be there as well. So, so maybe more opportunity to pick your brains about this. It's been a very, very useful episode of Inside Job Inside job Special thanks to Emily and IHAF I have for coordinating the interviews and many thanks, of course, to you, Marta, Bill and Jay for sharing your experiences with the Inside Jobsinside jobs listeners. Thank
43:51
Thank you, Robert. It's been fun.