Vodafone is the latest to join the bandwagon of companies that have moved programmatic buying in house in a bid to reduce costs, media reports said. Apart from the telecom giant, Pepsi and Unilever were among almost a third of the US marketers that have moved such operations in house, reducing their agency cost by 30%.
The telecom service provider has decided to move two-thirds of its total digital ad spends in house, amounting to about $140 million annually. Its total digital investment in advertising is in the range of $200 million, and was being handled by Wavemaker, which will now be handling a third of this business. Wavemaker also handles the companyâ€™s traditional media planning and buying business.
Media reports claiming confirmation from Vodafone officials said the company plans to build in-house teams that can handle biddable media such as search, programmatic and social media. These steps are being taken up in many local markets, including UK, Germany and India.
In the US, the companies that opted for in-house managing of digital ad buying stood at 14% in 2016, which increased to about 35% in 2017, reducing the role of external agencies.
This in-house handling by different companies is something agencies had been dreading for long.
In the US, a lot of marketers said managing digital ad buying in house reduces cost by 30%.
However, the sheer size of the business and the market suggests that the agencies are here to stay for a good amount of time.