It's that time of year again, when the market starts rounding up what happened in 2018, what was buzzword-worthy and what was real and what was business-as-usual. At AlwaysOn Digital (which works with both brands and agencies), we keep going back to a single trend.
It's not AI.
It's not blockchain.
From a topic perspective, it was certainly one of the most written-about areas this year. But did more brands actually "in-house" in 2018 off the back of reports from major organizations telling us (and agencies) that more CMOs were considering this shift? Let's take a look.
By the numbers
More than two thirds of respondents to a recent Forrester/In House Agency Forum survey said they used in-house agencies for some services in 2018, an increase of 52% from 10 years ago. This pool included 70% of marketers who oversee programmatic strategy and campaign direction in-house. However, Forrester also estimates that brands will shift over $60 billion in measured media from one agency to another in 2018. Though in-house agencies and consultancies are clearly increasing, they tend not to have the same caliber of talent, creative prowess or media capabilities. Forrester's "Unleash the Potential of In-House Agencies" recommends that CMOs invest both in in-house capabilities AND external creative and media agency partners, noting that, "This provides both in-house and external agencies a role. The best work and highest returns will come from CMOs that blend agencies, not break them."
What agencies must do
There is still room for agencies to muscle in to fill the gap, but they need to shore up their data, technology and insights capabilities to succeed. For instance, agencies can help brands implement a data management strategy, better align needed data with their technology stack and share insights to improve future campaigns. They can use every opportunity to overlay findings with a strategic lens, seeking ways to generate continuous insights for clients, such as finding new audiences to target.
If agencies can pivot to be more consultative, and work with technology providers on bespoke solutions that service their clients, they will create a new value prop for themselves that carries them through the next decade of digital marketing evolution.
What brands must do
There are some additional tips that Avi Dan, CEO of agency search consultants Avidan Strategies, shares in a recent Forbes article for CMOs:
Empower agencies to build capabilities and deep industry knowledge by squashing category exclusivity and competitive conflicts---meaning, don't worry about who else your agency is servicing, focus on transparency and protection of your information.
Think holistically by letting agencies operate across channels, business lines and budgets.
Rethink compensation strategies that keep you from accessing the best talent at your agencies.
Photo from Creative Commons