The merits of brands using in-house agencies have been debated for decades but driven by the demands of real-time marketing, the topic has taken on a new currency in the past two years.
Brand owners like Kellogg, Unilever and Kimberly-Clark have built their own digital media buying desks, while Nike and Starbucks go it alone in social media. Viewing social data as critical to the company’s CRM success, General Motors took its management in-house earlier this year.
Control, speed and transparency are the reasons most often cited by companies doing digital buying and social media for themselves.
As for creative services, the criticisms of in-house operations I have heard over the years range from a potential lack of perspective from being too close to product/brand to perceived difficulties in attracting top talent.
Yet in-house creative is a concept appears to be gaining popularity, if a 2013 US survey of marketers is to be believed. A study conducted last year by the Association of National Advertisers, The Rise of the In-House Agency, found the penetration of in-house agencies increasing 16 percentage points to 58%, from a similar survey conducted in 2008. The ANA attributed this to the growth of digital, social and mobile marketing that requires a nimbler response.
This, in turn, has given rise to a wide variety of in-house creative models. From Specsavers' own in-house agency, to the Jaguar Land Rover joint venture with Spark 44, to Oliver, which offers bespoke on-site agencies (and here I must declare an interest, as I consult for Oliver), we speak to the leaders of these three agencies about what their 'alternative' models have to offer.
1. Client-owned: Specsavers
Graham Daldry, creative director, Specsavers
Q: Describe your business in a sentence
We are a full service creative department working across the whole of the business, but our principle client is Specsavers Marketing.
Q: What is the main benefit your client derives from the way your agency operates?
We work closely with the business and can respond to (and sometimes anticipate) needs quickly without sacrificing quality.
Speed is a real advantage of working in house. The creatives are all part of one organisation, they have a direct line to the client, and there is no other party to consider. This is one area where not being a separate legal entity works to our advantage. Our creative resource is there to deliver business results for Specsavers. There are no other business considerations or financial constraints on creative time.
Q: Why does your model work better than, say, the Spark44/Jaguar model, where the agency is offsite and away from the brand?
We are probably not dissimilar. We work separately from the rest of the business and find that a little distance is useful in maintaining creative perspective and integrity. However it is also useful to be close to the brand.
To be honest, it’s a balancing act – there are always pressures to lean one way or the other. But it’s one I think we have been able to maintain very successfully. Creatives coming into the department always feel very at home there – it feels just like an agency creative department.
Q: What was the inspiration for your agency model?
Specsavers has always had an in-house agency and there was no one inspiration. I worked in different agencies so I have a good understanding of various agency models. The department draws on many of these, the only significant difference being that we have always been genuinely cross functional with design, web design, advertising, production and film all under roof, more or less in the same room.
Q: One criticism of in house models is that staff get too close to the brand.
It’s vital to have some distance between the agency and the brand. You see a lot of in house models where the agency is too integrated with the client’s business and the work is generally poor. You can’t be a ‘client who produces creative work’. That would be disastrous and wouldn’t work.
You have to be able to operate the same way as an agency would and be guided by the same independent creative standards. You have to have freedom to produce and stand for good work. It’s not a factory. We are creatives first. However the department exists within Specsavers, to work for Specsavers. So like that the company gets the best of both worlds.
Q: The best campaign a Specsavers team has ever created?
If ‘Should’ve gone to Specsavers’ is considered to be one campaign, it’s clearly the best we’ve produced. Within that, the work for ‘Bingo’ delivered good results on TV and online, and our Suarez press and viral ad is probably our best real time marketing work to date.
2. Joint venture with client: Jaguar Land Rover and Spark 44
Simon Binns, managing director, Spark44
Q: Describe your business in a sentence
We are an independent agency, with five offices worldwide; working with Jaguar as our sole client across all marketing disciplines.
Q: What was the inspiration for your agency model?
Steve Woolford (who became the co-founder and CEO of Spark44) devised the JV model which Jaguar felt would lead to the greatest transformation for the Jaguar brand. Spark44 was born, and within six months we re-launched the Jaguar brand with the "Alive" strategy and began work on the F-TYPE launch. We strive to be true demand creation partners, delivering [what we call] Intrigue, Inform, Close and Deliver communications globally.
Q: What benefits does joint ownership deliver for Jaguar?
Better, faster, cheaper. Complete financial transparency with lower overheads. We have direct access to JLR senior leaders who are part of the Spark44/JV board, to enable speed of decisions and complete alignment with JLR business objectives. At Spark44 we have a dedicated group of professionals 100% committed to transforming the fortunes of the brands we work on.
Q: One criticism levelled at in-house models is that you can’t attract the best creative talent.
We’re not ‘in-house’ and we have no trouble attracting very high quality talent. For instance, we’ve just hired one of the best car creatives in Germany, Harald Wittig, as executive creative director. He worked on Audi and has a shelf full of awards. That’s the level of creative talent we are now able to attract.
Q: So what are your model’s downsides?
So far the model is proving extremely successful. Jaguar’s brand health is improving in all regions, sales are increasing; and the Spark44 business is growing significantly each year. Jaguar has been been nominated as the Marketing Society Brand of the Year for the second year running. However, we are in no way complacent and we’re absolutely committed to maintaining that momentum.
Q: What's the best campaign Spark44 ever created?
To date, the integrated, global F-TYPE Coupe launch campaign. It combines social media, customer events, out of home, brand partnerships, interactive web content, dual-screen mobile gaming and the 60-second "British Villains" Super Bowl TVC. All of which helped the F-TYPE overtake the Porsche 911 in many markets.
Q: Could Spark44 work for other brands?
One day we’d love to, but we’re a bit busy this year…
3. Bespoke on-site: Oliver
Simon Martin, chief executive, Oliver
Q: What is the main benefit your client derives from the way your agency operates?
The demand for high quality content in real-time is putting huge strain on the classic client-agency relationship. Digital is causing this rift and agencies are not positioned at the point of need to enable clients to deliver. We aim to help clients to do more high quality work faster, more cost effectively, while achieving greater transparency about the creative process and how the agency works.
Q: Is it not risky to be too transparent about the creative process?
Agencies are sometimes reluctant to put creative directors in front of clients as it can inhibit creation of the best ideas. We only collaborate with the client at the right times and we’re honest with them: if you dilute that creative process, you’ll get a diluted result.
Q: What was the inspiration for your model?
I was a director at Aviva for more than 10 years and identified an opportunity to create a bespoke agency model entirely tailored around client needs, rather than those of the agency. At the same time, the digital age has created the need to compete in the complex communications landscape, and traditional agency models don’t give you the scalability to do that. We saw an opportunity to provide clients with dedicated agency teams that work faster and are closer to their decision making.
Q: Why does your in-house model work better than, say, the Specsavers model, where staffers are employed by the client?
I am sure sometimes it doesn’t, but most of the time it does. Providing creative services is a non-core activity for clients. Clients don’t have to spend time and resources hiring staff – we take on that HR burden. Also, to be completely owned and employed by the client, we would argue, is a somewhat inflexible model. If you’re an agency with many clients, you can attract talent and, at the same time, achieve a level of intimacy with the client’s brands. Clients get more than they themselves can achieve; so they may be paying for five people but they’ve got access to the full agency pool.
Q: The best campaign an Oliver team has ever created?
Our content marketing work for Robinsons at Wimbledon in 2014 had a big impact on their following and engagement. And Hasbro loved our Transformers work so much the lead US agency work was canned in favour of our ideas.
(This article first appeared on Marketingmagazine.co.uk)
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