It’s Time to Get on the Front Foot and Defend Your In-House Agency

Image credit: Redd Francisco via Unsplash​

Visible to anyone on or off LinkedIn “In-house isn’t saving us money anymore, so maybe it’s time to rethink it.” It’s frustrating, but not surprising. People quickly forget the gains and focus on the cost. But, if you’re not tracking and communicating the value you're creating, you leave the door wide open to negative perceptions and bad decisions. Cost was never the whole point. If your IHA’s adding strategic value, make sure the business knows it — or risk losing it.

Someone told me the other day about a conversation they’d had with a marketing leader. “We set our in-house agency up to do things more cheaply but it’s not actually saving us money any more,” they’d been told.

This is worrying in a climate where we are starting to see businesses question and even close down their in-house teams.

Of course, some of this new pressure is being driven by the perception that AI can do a lot of IHA work now. But this is a topic for another day - because the assertion that they’re 'not saving us money any more’ wasn’t in reference to possible future cost scenarios. It was a recognition that the in-house team was doing more upstream work and so was starting to cost the business more than it used to.

Which is actually a sign of success. But it also meant that it carried a bigger expenditure number and was therefore attracting more scrutiny internally.

This is a threat IHA leaders – and their marketing colleagues who benefit from working with in-house teams – need to head off at the pass.

Firstly, let’s deal with the logic. Your IHA is almost certainly still saving you money - it’s just that you’re just not calculating the saving or paying attention to it.

This is because the ‘hard’ saving only happens once. You stop paying external agencies X and you divert that work into an in-house team which costs X-Y. But in year 2, the baseline becomes X-Y so, guess what? There’s no savings any more!

Except, of course, there is – because it would still cost you X to do the work externally…

So, you have to keep logging these effective savings on your internal reports. Otherwise, people will pay no heed to this reality.

The bigger point is that the value of an in-house agency is about more than merely saving money. If we accept that no more (hard) savings are possible after year 1, then the value is all about what the team ADDS: the tighter relationships with marketing leading to more proactive thinking, more commercial creativity, as well as faster reaction times and more consistent outputs, all of which lead to better ROI.

So you have to make sure this is captured and reported systematically. More than that, get yourself a soap box and shout it out until people are paying attention.

Of course, as the team matures, it gets harder to make incremental gains. This is when the same discipline is required as with the cost savings. So you need to dig deeper for your reference points and show improvement over a number of years rather than just year-on-year. Tell a story, don’t just report numbers.

After all, a blinkered focus on short-term gains is a very dangerous thing. And that’s as true of your analysis of the past as it is of your strategy for the future. Never forget where you came from – because that’s where you’ll end up again if you throw out the existing solution on the grounds it’s not doing any better than last year.