Commentary

Taking Media Management In-house Is Unlikely To Fix Your ROI Challenges

It’s increasingly common for brands to feel disconnected with their media agency. Lackluster strategy and performance has pushed some CMOs to bring media management in-house. But the law of unintended consequences often rears its head, slowly yet pervasively.

Before in-housing media, ask yourself what problems are you trying to solve.

Do you suspect your agency team isn’t stocked with superstars? If so, demand substitutions or find another agency that will deliver. 

Do you believe you are being overcharged? Have a discussion with the senior leadership of your agency. You have the right to transparency and to explore new contract terms.

But if you’re at your wit’s end and you simply want to replace your agency with an in-house team, here are four significant factors to keep in mind: 

1. Recruiting and Retaining Talent

  • Unless your headquarters is in a major ad market rich in talent, you’ll probably be relocating talent. The expense might be much higher than you anticipate.
  • Media management is a specific skill with a clear career path at a media agency, but far less so on an in-house team. What’s the next rung in the ladder for your new hire? Superstars can be fickle and leave for higher salaries and titles.

2. Lack of Specialization

  • In-house teams can only staff in increments of whole FTEs. Say goodbye to on-demand, a la carte expertise your agency can provide.
  • In an era of bewilderingly complex digital media, your in-house team members will wear far too many hats to be effective and productive.

3. Tools and Mastering Them

  • Great media agencies have a wide range of planning and research tools. The cost of these tools is amortized over dozens of clients. You’ll miss footing only a fraction of the bill, sized to your needs.
  • Your in-house team will be competing with media agencies that work for your competitors. Your team will be up against media professionals with sophisticated tools and techniques to outmaneuver your programs.

4. Tunnel Vision

  • Corporate in-house media staffers often get stuck in a rut while agencies rotate their employees regularly. Most agency employees are able to work on several accounts within a few years on the job, bringing fresh new perspectives to the table. It also diminishes turnover (See #1).
  • Agencies can test, learn and share winning strategies across clients, especially if that agency has multiple accounts in the same business category. Your marketing team will have a sample size of one from which to innovate and improve.

With so much invested in your media budget, you will almost certainly compromise growth to save on some overhead. It’s pennywise and pound foolish for most. Very few in-house media teams have the firepower to deliver best-in-class media programs. An in-house team that saves thousands in overhead might miss out on millions in revenue opportunity.

Building an internal media agency inside your company is an all-consuming, multi-year initiative. It’s probably not the best place to focus your talents as well as the talents of your marketing team. It’s quite enough to be the masters of your customer analytics, brands, product road maps, promotions, financials and internal communications.  

Do you really want to take a crack at being David Ogilvy, too?

2 comments about "Taking Media Management In-house Is Unlikely To Fix Your ROI Challenges".
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  1. Ed Papazian from Media Dynamics Inc, May 7, 2018 at 3:08 p.m.

    Good piece, David. I, too, have noted the basic problem that most advertisers have when considering the idea of bringing media "in-house", namely the difficulty in recruiting and keeping good talent. This is especially true for traditional media. Not only must the client purchase all sorts of supporting research and technologies---like TV rating surveys, magazine and radio audiece studies,competitive spending reports,  digital "programmatic" DSPs, etc.---- but who is going to use them? And what's the career path for those media types who are hired? The fact is that there is no upward path at most advertisers for a good media person---as has been demonstrated many times in the past. It's a dead end position. It doesn't lead to brand management, the CMO's office, production, distribution, etc. Why would anyone who is upward mobile take a chance and go to an advertiser's "in-house"  media operation, particularly when it is common knowledge that management will back the CMO and brand people over their media cohorts in just about any dispute over how the brands' advertising money is spent.

    It has been suggested that the new "in-house" media team report directly to top management, not to marketing----but that's extremely unlikely. Does anyone think that corporate CEOs will become media mavens so they can evaluate the performance of their media folk? Not likely.

    So far, the momentum toward "in house" media has been almost totally digital driven and much of those activities are sales promotion, not branding, oriented. At this point, I see little taste to plan and buy national or local TV, radio or print media on the client level.

  2. John Harpur from Yellow Submarine, May 8, 2018 at 5:29 p.m.

    Well said gentlemen. 

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