Interviews, insight & analysis on digital media & marketing

Advertisers rush to set up in-house creative agencies to exploit digital opportunities

More than half of multinational companies are establishing in-house creative agencies, according to a new report that cites “digital opportunities” as a key driver.

The research, conducted by the WFA and The Observatory International says that 57% of multinationals have undertaken creative in-housing with respondents reporting greater cost efficiencies, better integration and increased brand and business knowledge. Fifty-five percent also reported that in-house teams had quicker and more agile processes.

Three out of four in-house units have been set up in the last five years and in-house teams are attracting more work, with 82% saying workloads are increasing in the last year. Anecdotal reports also suggest that coronavirus has not led to cut-backs in these agencies – and in some cases quite the reverse.  

The report, Global Trends in Creative In-Housing, is based on responses from 53 advertisers with an approximate annual global spend of US$ 83 billion.

Almost all (94%) of those with in-house capabilities had them for digital content, compared to around half with in-house media planning and buying capabilities. Yet most (95%) continue to also work with external agencies, though the balance of internal creative output is now on average 37%.

The relationship and balance between in-house and external creative varies enormously: some reported looking externally for big, strategic ideas development, with regular production work done in-house but others had the reverse approach.

Almost 40% said that they allowed both in-house and external agencies to pitch against each other for projects to drive the best possible responses. However, there was often a disconnect between how in-house and external agencies were briefed and assessed.

Stephan Loerke, chief executive of WFA said. “What this survey highlights is the need for clearly defined roles and responsibilities as well as a clarity over scope of work for each agency, in-house and external. Having an imbalance in working processes creates problems and challenges that could mean that neither resource is used to maximum capability.” 

The full report, available to WFA members, can be viewed here.