In-house or outsource? The marketing tug-of-war explained

New Delhi: Brands are increasingly flexing their creative muscles and asking, "Why pay someone else to do what we can do ourselves?"

Fueled by a quest for agility, cost-efficiency, and tighter control over their narratives, companies are rethinking the traditional agency model, opting instead to cultivate talent within their own walls.

This story examines the factors that influence these decisions and provides insights into brand creativity's evolving dynamics.

Arvind Iyer, Head of Marketing at Piramal Finance, told BestMediaInfo.com that much of the brand’s creative output is produced in-house. While the brand works with the creative agency The Womb, everything one sees on social media and below the line is done in-house.

Iyer said, “We don't work with external partners; instead, we have all the necessary capabilities, including a studio and a full production setup, in-house.”

When asked about the rationale behind Piramal Finance’s going in-house with its marketing, Iyer said, “We discovered early on that we serve a very large and diverse population, which requires an in-depth understanding. Reducing our brand strategy to a brief limits the intelligence of the person working on the project. In our case, whether it's a videographer or someone at the content desk, everyone has met customers and knows the entire ecosystem well. 

Their empathy and understanding are reflected in their work, resulting in fresh ideas that align with our goals. We have a fluid marketing ecosystem internally, working with every function without following the traditional brief-ideation-execution process. We're constantly working on new ideas, much like a running kitchen.”

Refuting Iyer’s argument that people involved in in-house marketing operations know the brand better than anyone, KV Sridhar (Pops), Global Chief Creative Director and Founder of HyperCollective, said, “I have a deep understanding of my client's business, far better than many of the new brand managers who come and go. During my nearly 20-year tenure with Coca-Cola, I have witnessed numerous people within the country join and leave, yet I remained a consistent custodian of the brand.”

While Iyer believes that the in-house marketing model allows Piramal Finance to focus strongly on building consumer intimacy and gaining a deeper understanding of the business, Sridhar views in-house agencies as merely a cost-saving measure. He describes them as "something that brand managers do to impress their bosses by showing they are saving money."

Let’s take a look at both the arguments.

Iyer points out that Piramal Finance’s full-suite in-house marketing team ensures every campaign reflects valuable insights, driving cohesion and creating a fluid marketing ecosystem within the organisation. “This approach enables us to stay agile and deeply integrated with our brand’s core values and objectives. As a result, our campaigns maintain consistency in our brand narrative and the language we use across all customer touchpoints,” Iyer resolved.

Backing Iyer’s perspective, Vandana Das, an Independent Consultant and Partner at LOM Digital, also sees significant value in the in-house marketing model. She noted that individuals involved in in-house operations tend to focus solely on one brand, rather than managing the demands of multiple brands, which provides greater control to the marketing teams.

“Additionally, with proper induction processes in place, these teams gain a deep understanding of the business and its rapidly changing landscape, which evolves on a day-to-day basis,” Das added.

Now, let’s hear what the other side has to say.

Sridhar believes that many people focus on saving money to impress their bosses. However, saving money should come through achieving better ideas and more effective work that delivers greater efficiency, not simply cutting costs. Cutting costs alone does not generate demand. It might fulfill an order, but it cannot build long-term demand or growth.

“Coca-Cola has its own social listening tools, complemented by an ORM (Online Reputation Management) agency to ensure real-time responses. They have dedicated teams actively monitoring and addressing online interactions. Additionally, the company has a substantial design team that focuses on creating and maintaining their design identities. 

Certain tasks, especially those requiring better governance, are handled internally to maintain quality and consistency. In-house teams are great for mechanical jobs that do not require specialised expertise, so brands may opt for generalists, prioritising convenience or cost efficiency,” Sridhar elaborated.

Walking along similar lines, Rahul Vengalil, CEO and Co-founder of tgthr, also mentioned that brands should avoid in-housing the advertising function, except for social and digital creatives, as well as CRM(Customer Relationship Management creatives.

“These areas allow for greater control and better contextualisation using PI data, which might be challenging for an agency partner to execute effectively. Additionally, the turnaround time for these tasks is often better when handled in-house. However, in-housing media is not advisable, as it eliminates the volume buying advantage. That said, functions such as SEO, Google Search, and Meta buying can be managed internally,” Vengalil noted.

Talent

When it comes to attracting top talent, experts have a two-front opinion here as well. Proponents of in-house creative teams feel that they can attract better talent as they just have one client to cater to, which results in less workload, unlike traditional agencies that have different accounts to work on.

On the other hand, advocates of traditional contend that in-house agencies fail to attract top talent as they provide less exposure.

Explaining this stance, Sridhar said, “Top talent often avoids working directly for a client because it limits their exposure to just one account, restricting the variety and excitement that comes from working on multiple brands and categories. This lack of diversity can lead to boredom, which is why many professionals in the advertising industry prefer to join agencies rather than work in-house for a single client. 

Quality of talent is paramount, and so is expertise. Whether it's account planning, marketing, client servicing, media, or creative work, these professionals gravitate toward reputable agencies. Agencies offer a fulfilling environment where they can grow and satisfy their hunger for challenging and diverse work.

This is the reason why Coca-Cola still works with over more than 100 agencies worldwide because clients still require fresh ideas and new experimentation to stay innovative and exciting.”

Adding to Sridhar, Vengalil said, “When you work with an agency partner, they bring a wealth of collective experience and ideas to the table, which is often lacking in in-house teams. While in-house teams might excel at meeting timelines due to their faster turnaround time on ideas, they often miss out on active research and brainstorming.

If given a brief, an in-house team may produce ideas more quickly, but an agency is likely to generate more effective ideas due to their broader experience and diverse perspectives.”

Deviating from the above arguments, Das maintains that depending on the brand, even in-house agencies can attract top talent. “Big brands, with their extensive workloads and diverse product offerings across multiple categories, can attract top talent. 

In contrast, mid-tier brands, with their limited product line-up, often struggle to attract the best talent. The variety and scale of work offered by big brands make them more appealing to professionals seeking growth and excitement in their careers.”

Will in-house creative teams grow in the future? 

Looking ahead, Iyer contends that in-house marketing teams will only continue to grow. As businesses prioritise agility and integration, he expects more organisations to embrace in-house marketing models, as the impact on Piramal Finance’s brand’s marketing has been profound.

“Our messaging is now even more seamlessly aligned with our core vision, ensuring we resonate more strongly with our audience. The ability to quickly adapt based on real-time feedback has further strengthened our customer connection,” said Iyer.

Vengalil, too, calls attention to four key areas where brands can go in-house.

“I highly recommend that more and more brands in-house the following: performance media buying, social media and content marketing, SEO, and CRM creatives. These services are highly structured, and since digital tools are widely available online, they can be easily managed internally. With the advent of generative AI, tasks such as creating search copies, crafting meta ads, developing content strategies, and writing AI-led content for SEO have become even more straightforward,” he commented.

However, he also added that brand-led communication is where agencies truly excel, whether it is media or creative work. These areas are more subjective and often require taking a leap of faith. Agencies bring a wealth of experience and creativity to the table, ensuring that brand communications are impactful and resonate with the target audience.

In summary, in-house creative teams offer the advantage of attention to detail and reduced need for follow-up, especially with the surge in digital content creation. They produce work quickly and consistently without the need to chase external agencies. Nonetheless, traditional agencies bring a wealth of experience from working across various brands and portfolios, leading to richer ideas and execution.