Only 4% of the in-house agencies were established in the past year, indicating the trend may have slowed, but that may not be the case if the 17% of survey respondents who said they are ‘considering’ establishing an internal ad shop follow through on their plans.
And for 82% of the brands with already established in-house agencies, creative workloads had risen (either ‘considerably’ or ‘somewhat’) over the past year
But even taking into account that rise in workloads, brands still only handled 37% of creative work in house, and 95% of them said they still used external agencies. And 38% of agencies said they let internal and external agencies pitch against each other for briefs.
Asked about the main benefits of an in-house agency, brands most often cited cost efficiencies (91%), followed by better integration (64%). while creative expertise was way down the list at 9%.
In terms of cost cutting, 69% of respondents said they’d saved more than 6% by setting up an in-house agency, while 48% claimed savings of over 20%.
The (small) sample survey also suggests brands that create an in-house agency rarely regret it, with only 4% saying they had shut down previously established internal agencies. But that’s not to say that bringing advertising in house doesn’t come with challenges: managing workflow was the chief concern, cited by 62% of respondents.
On whether the pandemic will hasten or slow clients appetite for moving advertising projects in house, the WFA and Observatory International hedged their bets, writing: ‘While Covid-19 is forcing many businesses to review their operations, some of those with existing in-house teams are reporting an increase in demand for their services, and expect their in-house agencies to grow in the coming years as a result. At the same time, some commentators predict that COVID-19 will make in-housing a less attractive model due to declines in business and the many fixed costs involved.’
