Growing trend: in-housing in digital marketing

2018/11/27

The talk about advertisers’ desire and need to take their digital marketing operations into their own hands is running hot. According to the IAB Europe’s report, 54% of European advertisers are in-housing programmatic buying of advertising this year, and 43% of those remaining are considering in-housing. The same trend is also strongly arising in the Nordics, as more and more advertisers are testing, or at least considering various models of digital marketing within the company.

What is in-housing?

In-housing in general means that the advertisers increase their own abilities in digital marketing by acquiring the technologies and know-how. The scale is wide. For some companies, this may mean ownership of marketing technology and data, for others content production, and for some it includes all from technology, production, media planning to buying. But in a nutshell, in-housing means that previously outsourced services will be insourced wholly or partly.

Motives vary by company, but recurring arguments are a growing requirement for media transparency, data ownership, independence from outside partners, response rate and, of course, the effectiveness of advertising. One might think, that especially ecommerce companies benefit from seamless data recovery, the ability to make quick tactical decisions, and taking measures to production almost in real-time. If by in-housing they are also seeking cost savings, the Excels should be checked carefully. We dare to strongly suspect there is no savings. The costs will only relocate from purchasing services to salaries and software licenses.

And we might assume this trend will also be followed by a countertrend. Some of the in-housed activities will be outsourced again. But by then, the advertiser will have already learned what they need, and outsourcing a familiar function will be easier and safer.

There is still a need for partners in the future

Personal experiences of in-housing projects have taught us that technologies and their integrations are, after all, the easiest part. It is the staff training, finding and keeping experts, setting up performance indicators and refining processes that will require a little more time and effort. If you are starting with a clean slate, you should draw at least 18 columns at the beginning of the project calendar and by this we refer to months. But you don’t have to do everything at once. The first part could be the technology and data ownership.

And there is still a need for partners in the future, both from the point of view of technology and resources. Even if the focus of the work would become more internal.

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