• by Brad Backenstose , April 26, 2019

Marketers’ in-house agency debate has gone on for quite some time, taking twists and turns against new marketplace imperatives and needs. 

Recently, though, a trend has emerged. Digital-first marketers are outsourcing upper funnel media duties to agencies, while maintaining core performance responsibilities in-house. 

It’s not strictly in-housing or outsourcing. Let’s call it dual-housing.

This movement is a healthy industry evolution, giving advertisers more options for building bespoke planning and buying models and agencies new ways of providing value. 

At its best, the arrangement empowers clients with flexibility to work in a way that fits their operating model and growth ambitions, while borrowing expertise where they may fall short. 

This is especially true of D2C brands, which have built their companies on the back of lower-funnel marketing and view this performance marketing acumen and data proximity as a competitive advantage.  But as these brands mature, they have begun to look to agency partners to enhance their capabilities and find new opportunities for growth.  

How We Got Here

While companies have maintained internal media leads and media teams for a long time, the tactical planning and buying of media was, for the most part, reserved for agencies. 

This has since become less common, due to several factors which have coincided with the rise of digital and addressable media: the ease and scale of self-service platforms; proliferation of content and expectations of real-time responsiveness; and the value of first-party data and unique, internal strategies that can be built from it.

Maximizing Agency Value 

Creating an in-house team requires thoughtful consideration of roles and responsibilities. Adding an agency partner to complement in-house efforts is no different.  

Brands considering a dual-housing model must first determine where each team holds a true competitive advantage and appropriately balance the skills for long-term impact. 

Here are four tips for implementing a successful dual-housing structure:

1. Honestly assess internal ROI. If you are in-housing, you can run the risk of becoming myopic in your media, obsessing over marginal increases in existing performance channels and unclear if incrementality exists. Harnessing the aggregated knowledge of an agency allows you to benchmark what you are doing internally, and what external options exist, before taking any steps. 
2. Agency scope isn’t black or white. If the result of an audit suggests that your in-house social capability is underperforming, that doesn’t immediately mean you should hand it off to an agency. Consider using the agency as a consultant to get the team up to speed and leverage its training resources for ongoing education.
3. It’s not set it and forget it. While it’s standard practice to pursue long-term agency relationships, building in flexibility at the onset ensures that you're constantly optimizing for success. This is especially true for advertisers new to upper-funnel advertising or those who plan on short cycles, and therefore may not want to be locked into certain services or staff. While dedicated resources can offer critical stability and consistency across an agency team, all employees don’t need to be on retainer.
4. Connect it all together.  There’s a risk when a company in-houses that its media becomes a black box to agencies.  With integration at the heart of the agency model, taking full advantage of agencies' unique tools, technologies and ways of working can provide a holistic view to plan, measure and optimize against.

Ultimately, dual-housing is a strategic business decision. Brands that choose to explore this model must use all the levers available to maximize agency value, and agencies that embrace this new way of working will better unlock growth for clients.