Originally published in Campaign US, July 19, 2019
by Marla Kaplowitz, 4A’s
When I read “Managing In-House Agency Creative Content and Legal Concerns,” the Association of National Advertisers’ new study with Boston Consulting Group and Reed Smith, one thought kept crossing my mind: Partnership is key.
Although the report documents the concerns that brands have about in-housing, marketers’ strategy of having some capabilities in-house makes sense. Keeping business data under one roof may be the answer for some brands. And rapid-fire communication of social media and other digital formats can benefit from a responsive in-house legal counsel.
Going it alone, though, is a gamble. In this environment of constant change, frontrunners using external partners see the business impact up to 4.6 times faster than those without partners, according to a Deloitte study on The Fourth Industrial Revolution.
Marketers that enjoy some advantages from in-housing may discover that a strategy that omits agency partnerships entirely could expose them to risk in other key areas.
Creativity flourishes in agencies, away from brands’ singularly focused environments. And what agencies bring to brands is their provocative breadth of perspective, boundless energy, and effective creativity that helps brands shatter expectations and grow their business.
Indeed, one of the biggest concerns to brands about in-housing is how to attract creative talent to their teams—and keep their staff driven and focused.
Going in-house, one director of marketing said in the report, often requires “dealing with the monotony of company life, where you focus on fewer things.” Because staffers who come from agencies are accustomed to working on a wide range of projects in a lively environment, keeping such talent energized concerns 63% of the report’s 111 survey respondents. And 44% wonder how best to attract this talent in the first place.
That question often goes straight to the bottom line. That’s why marketers need to view agency creativity—in all forms—as an investment, not a cost.
In fact, the costs of not investing in innovation and agency creativity can be high. After cutting its advertising budget by 39% since 2014, Kraft Heinz hasn’t invested sufficiently in its brands, and has lost half its share value, written down $15 billion on Kraft and Oscar Meyer, and reduced its dividend by 36%, according to a recent Forrester report, “The Cost Of Losing Creativity.”
If you think about the most effective marketing efforts you’ve recently experienced, they tend to result from strong marketer-agency partnerships. At the Festival of Creativity in Cannes in June, when Apple received the Creative Marketer of the Year Award, Apple’s VP of Marketing Communications Tor Myrhen celebrated the relationship with TBWA/Media Arts Lab founded on “a partnership built on trust.”
Why are these efforts so innovative, so inventive, so effective? Because the people at agencies that create them are hungry. Agencies never stop feeling the pressure to perform at the top of their game; their leaders understand their business is always under review. The key currency is constant iteration and evolution for clients. That’s why agencies exist: to help marketers drive business growth.
So agencies work hard to keep their clients. And that takes staying on top of business, cultural, and tech trends, providing the necessary objective and outside perspective, and always going above and beyond, because they have a vested interest in mutual success. And that includes having the strength to champion, as well as challenge—even when that makes marketers uncomfortable. Now, that’s when real creativity and growth happens.
Working with agencies is a business investment to support objectives. But as the Forrester report points out, even budget-conscious marketers are learning that in-housing may no longer be a cost-efficient move.
After all, it takes an enormous amount of time, effort, and money for brands to establish and develop their own in-house practices. When an agency provides its own specialized practices—whether creative, digital, video, data sciences, e-commerce, media, programmatic, or any others—that partnership is money well spent.
So while in-housing some capabilities is often the right move for marketers, the key is balance and collaboration, especially in a business environment that never stops evolving. Agencies recalibrate continually to adjust to ever-changing business conditions. Brands and agencies draw energy from strong mutual partnerships. And they succeed together.
Marla Kaplowitz is the president and CEO of the 4A’s.