Is in-housing right for you?

Listenmore's Stephan Argent says you'll need a clear vision, retention strategy and the resources to manage talent for your in-housing solution to succeed.

By Stephan Argent

As of last October, more clients were in-housing capabilities in 2020 than at any point in the last decade. Driven by the lure of perceived nimbleness and cost savings, the trend toward in-housing seems to have reached fever pitch with marketers either going all-in or creating hybrid working relationships between their teams and incumbents.

So, is it working? And at what point should marketers call a timeout and ask whether their quest for “cheaper, faster” is creating new problems in its wake? As promising as in-housing efficiencies may seem, not all solutions are created equal.

“Look how much money we’re saving!” you’ll say. Well, let’s do the math. You’ve brought in five resources at $100,000 each, instead of paying $1 million – adding in overhead and profit – for those same resources at an agency. Pretty good, right?

What happens when those resources get bored of working on the same business day-in, day-out with little room for advancement and decide to quit? Your job as head of marketing (which comes with its own overhead) shifts from what you’re good at – building and managing your brand – to what you wanted to avoid in the first place: building and managing an internal agency, with its attendant process minefields, production conundrums, training needs and likely a more junior team than you had with an agency.

The point is, running an in-house agency takes work and will ultimately be judged on its ability to help drive your business, not just save money. So whether you’re contemplating an in-housing solution or managing one today, here are three things to consider:

1. Having a clear vision 

Marketers must be able to articulate a clear vision for their in-house agency in order to align internal resources and stakeholders to their purpose. That vision must include clearly defined rules of engagement to avoid chaos from inter-departmental asks and expectations. If you’re left with an in-house agency that’s essentially churning out product or feature advertising dressed up as brand leadership, trouble will undoubtedly follow as results fail to materialize.

2. Talent retention

Finding ways to attract – and retain – the best talent is pivotal to the success of your in-house efforts, regardless of whether you’re developing social content, managing a programmatic media enterprise, or have ambitions for larger brand advertising projects. If you don’t have a strategy to retain your resources by constantly giving them an opportunity to draw on fresh initiatives that will keep them engaged, you might run the risk of losing talent.

3. Managing the team

Managing in-house agency resources is anything but “set it and forget it.” Building fully-loaded P&Ls, honing workflows, managing technical capabilities and grooming talent can be time consuming but are the foundation on which an in-house agency has to stand.

Where marketers have chosen hybrid models, there should be clear demarcation points between in-house and external agency responsibilities. Without them, neither will be able to focus or be held accountable for their work and corresponding results.

Where creative resources are involved, teams should have their work critiqued and honed objectively and not be allowed to “mark their own homework.” Enabling creative resources to become their own clients with no checkpoints is otherwise one of the surest ways for brands to lose their way.

The bottom line with in-house agencies is, think carefully before you start or know when to draw the line if it’s not a fit with your organization. Conceptually they may look good and the lure of immediate savings can be irresistible, but the reality is they take a huge amount of work to run successfully, talent is often difficult to find and even harder to retain.

Stephan Argent is founder and principal at Listenmore, which offers agency search management and confidential advisory to marketers.