In-Housing in 2020 – Why We Need to Embrace the Change

Article Takeaways:

• An insight into how consultancies are creating partnerships with agencies.
• Agencies and brands need more streamlined processes.
• The continued shift in agency models in 2020 is an inevitability

Agencies are suffering from a trust problem.^[1] Clients are looking for transparency in how their agencies work and charge, and while agencies, for the most part, have been unwilling or unable to make changes fast enough, larger management consulting firms have seized the opportunity to apply true-tested rigors and techniques to this value chain, offering audits of gaps and overlaps.

Consultancies are increasingly making recommendations for what clients can and cannot handle in-house, often by advising which technology stacks they need to invest in, to best handle these newly in-housed responsibilities. In 2020, big brands will still be heavily invested in a combination of traditional technology stacks and SaaS solutions. Given the lack of transparency in this space, the growing trend of bringing these core competencies in-house has been overwhelming. But, that’s not to say that agencies are being done away with completely, in fact, they should be a key part of the movement as we head into this new decade^[2]. There will always be a need for experts to advise brands on how to use their newly-acquired technology, and that is not going to change.

Consultancies see the value in agencies, so much so, that some are even buying agencies in an effort to control the entire vertical.^[3] The main reason this trend hasn’t wiped out creative agencies completely is that it’s very hard to retain creative talent once earn-outs are over.^[4] The same challenge exists for brands, acquiring top tier creative talent is hard, especially if you are not a top tier advertiser located in a popular market like New York or San Francisco. While P&G might be able to attract excellent creative teams and persuade them to move to Cincinnati, the brands with that kind of industry pull are few and far between.

Brands want their agency partners to deliver more on core offerings, including design and creative work in addition to transparent pricing models, and nimbler ways of working. In order to adhere to these desires in 2020 and beyond, agencies need innovation to leverage on-demand technologies and work in more agile ways. This new decade will see the usual ramp up and down with freelancers replaced with networks of creatives who are standing by to heed the call when it’s required.

The rise of social media has created opportunities to track behavior (and in turn to target ads). This, coupled with the rise of connected devices (TV’s, phones, watches) has fragmented the media landscape beyond all recognition, resulting in an accelerated media cycle with viewers spending less and less time with individual pieces of content. To keep pace with these changes, brands and agencies need more tailored content, faster. Personalizing and localizing content is not something that agencies can typically do at scale. Multicultural agencies (who were themselves late to the game) are also not well placed to produce this vast volume of hyper-specific content, even if they are better at developing culturally relevant messaging.

This results in an overarching need for a streamlined process between agencies and brands, but also technology that can provide an arsenal of creative minds ready and willing to develop compelling content. We should not be afraid of a shifting model or rise in tech replacing our creative roles, instead, we should be embracing how these changes will enhance the creative process as a whole.

^[1] https://www.adweek.com/agencies/4-ways-agencies-can-be-more-transparent-in-their-advertising/

^[2] https://www.thedrum.com/opinion/2019/06/17/agency-vs-housing-not-eitheror-question

^[3] https://adage.com/article/news/consultancies-rising/308845

^[4] https://www.campaignlive.com/article/droga5-maintain-its-creative-culture-accentures-acquisition/1581565