Staying Ahead Amidst In-House Agency Growth: The Key to Marketing Agency Evolution

 

The marketing agency landscape has experienced a seismic shift, with in-house agencies emerging as an indisputable force to be reckoned with. Beyond being a mere fad, in-house agencies have firmly solidified their position at the very core of the brand marketing ecosystem.

Industry Insight

According to a 2023 survey by The Association of National Advertisers (ANA) on client-side member marketers an impressive 82% of brands now have an in-house agency, a considerable increase from 78% in 2018 and a substantial leap from 58% in 2013.

It is evident that in-house agencies are no longer merely an experimental or temporary solution; they have become an integral part of the marketing strategy for many businesses. According to the ANA’s forecast, in-house agencies are expected to dominate the marketing landscape, reaching an astounding peak of 85-90%. This signals a remarkable surge in their influence and no doubt contributes to the fact that 43% of agencies are finding it more difficult to obtain new business.

Yet, the rise of in-house agencies does not imply a disconnect from external help. On the contrary, 92% of ANA respondents continue to collaborate with external agencies. In fact, a recent separate survey of agencies by RSW/US found that 46% of agencies reported winning new business through collaborations with in-house agencies.

In-house agencies have proven their mettle, particularly excelling in the realm of social media. 78% of brands expressed confidence in their in-house capabilities and are ramping investments in social advertising, with Statista projecting $207 billion in spend this year. Moreover, Demand Gen reports that brands are also boosting investments in channel programs by a substantial 70%. Herein lies a vast, compelling opportunity to tap into an additional revenue stream: location-level Facebook and Instagram advertising.

Channeling Opportunity

Every local partner, such as channel partners, agents, franchisees, dealers, or distributors, can serve as invaluable conduits to link consumers from national and regional brand awareness to specific points of purchase.

“A third of national marketing leaders say local partners generate up to 40% of overall revenue.”

According to a recent CMO Council report, 95% of CMOs recognize that increasing revenue through local channels holds strategic importance in the upcoming year. 54% deemed it very important, if not critical. Surprisingly, social advertising, despite the benefits as a massive, targetable digital platform, has been largely overlooked when it comes to collaborating with local partners, even though social advertising remains their top marketing priority for local partners.

Solving a Significant Business Need

By offering local social advertising, agencies help brands cultivate local advocacy and loyalty with their partners. Often, the relationship between a brand and its local points of purchase can be strained. However, by empowering partners to drive awareness, foot traffic, and sales through a marketing channel they value, agencies can strengthen these relationships and foster a sense of loyalty and commitment from their partners.

Local Social Advertising as a Catalyst for Client Satisfaction and Sustainable Growth

By integrating local social advertising into their services, agencies can enhance their offerings beyond brand-level campaigns, addressing the intricate needs of local markets. This expansion allows agencies to upsell to current clients, attract new ones, and tap into previously inaccessible marketing budgets. Successful local campaigns foster client loyalty and retention, setting the stage for long-term partnerships and growth. Beyond running campaigns, agencies can offer consulting, strategic advice, and location-specific marketing expertise, generating additional revenue. The data produced from these campaigns can be analyzed, providing clients with actionable insights and tailored reports. This positions the agency not only as a campaign executor but also as a trusted consultant and data analyst. Ultimately, such specialization in local social advertising can attract enterprise brands with multiple locations, further broadening the agency’s client base and reinforcing its leadership in the industry.

As brands pivot to meet evolving consumer needs, an investment in localized social advertising underlines the power of synergizing national brand recognition with granular, location-based campaigns. For external agencies, this presents an exciting frontier to establish deeper, symbiotic relationships with in-house teams, complementing their strengths and capitalizing on emerging opportunities. As the industry progresses, one thing remains certain: collaboration, adaptability, and an unyielding focus on local market nuances are paramount for sustained growth and mutual success.

We hope you’ve enjoyed part one of our series focusing on How to Build a Local Social Ads Offering That’s Profitable for Agencies and Their Clients. To read the complete series and gain access to additional resources and use cases, fill out the form on the sidebar to download The Ultimate Local Social Advertising Playbook for Agencies.