Managing Digital Advertising Accounts: In-house or through an Agency?

A powerful trend is shaking the world of digital media advertising: the number of companies that have started to manage their digital advertising accounts internally, aside from marketing agencies, has reached its peak levels in 2019 in the United States and Great Britain.

According to a recent survey by the Association of National Advertisers (ANA), nearly 80% of its members manage all or parts of their online advertising campaigns internally.

Over half of the ANA members have moved away from using advertising agencies. Lego, Uber, Intel, Revlon, T-Mobile, Duracell, and Unilever are just a few of the names that have taken greater control or even established their own internal agency.

In Spain, the situation is similar, with more and more major advertisers taking a greater degree of control over their accounts.

The debate, therefore, is on the table: Is it better to handle the advertising budget internally, or is it still preferable to use a specialized digital marketing agency?

As we will see, the answer is complex, although we approach it complementarily when we analyze how to succeed in the era of automated SEM.

Management of Digital Advertising Accounts, Internally or Through an Agency?

 

Through the creation of their own advertising platforms, which anyone can use, Google and Facebook have allowed advertisers to deal directly with media owners in a simple and direct manner.
The increase in the supply of digital advertising through the auctioning of advertising spaces and a general loss of trust in agencies are other reasons underlying this change in trend.

This current appetite for internal management makes the concern within agencies about their medium-term survival understandable. However, despite this challenge, we believe that agencies are more important than ever to achieve the best possible results. Thus, 90% of marketing specialists who are members of ANA still have relationships with external agencies.

An essential aspect of the current business model is, therefore, that advertisers understand where they must draw the lines between what should be addressed internally and what is convenient to outsource in digital advertising. What lies between these lines is a subjective decision for each company, based on what is right for them and their particular business context.

We believe that internal/external management should be viewed as a spectrum.

Faktica-gestion-publicidad-en-casa

Services that Advertisers Should Have In-House

 

Relationship with Digital Advertising Platforms

 

Contractual relationships with major digital advertising platforms should be managed internally to ensure transparency and assure that the owners of digital platforms focus on the advertiser’s needs instead of the needs of the agencies that used to manage advertising budgets.
This is especially straightforward in the current framework since most of the investment in digital advertising focuses on the platforms of the main search engines (Google, Bing) and social networks (Facebook, Instagram, Twitter) that control 99% of the market. These platforms have standard service and investment terms, making it easy for advertisers to contract and directly manage relationships with them. The consolidation of media purchases with the chosen platforms allows brands to have full control over how and where the money is spent, ensuring financial transparency.

Data Ownership

 

The data generated while managing a campaign should always be owned by the advertiser, not the agency.

Strategic Direction

 

The strategy should always be the responsibility of the advertiser. No external actor can attain the level of business knowledge necessary to define the strategy.

Budget

 

This also makes it easy to ensure a fundamental point in advertising investment: never allow an agency to decide your budget. Even the most dedicated and transparent agencies, when working on commission, may be tempted to spend more than advisable. However, it should be noted that flexibility in spending is necessary in mediums with trends as unpredictable and complex as online advertising.
The budget for advertising investment is another element of the company’s strategic direction which, evidently, must be controlled by the advertiser. No external agency can have the level of understanding of a company needed to determine its long-term strategy.

Additionally, it should be considered that both agencies and advertisers will have ideas about the medium-term strategy based on their own experience, so continuous collaboration is important. While advertisers should oversee the general strategic direction, if there is a trustful relationship with agencies, outsourcing part of the more detailed planning can be good for process improvements. This collaboration is essential for the long-term success of any advertising strategy.

One of the goals of internal control of digital advertising management is to simplify and understand the structural perspective of investment in order to expand the marketing strategy, presenting the right message to the right people at the right time.

Brand Promotion

 

In this strategy, one of the focal points included is brand promotion, which should also be internally controlled. This doesn’t mean one shouldn’t turn to an agency for digital promotion as there are some that perform extraordinarily irreplaceable work thanks to their profound knowledge of the virtual environment. For example, pay-per-click remains a significant exercise in brand development: the selection and targeting by keywords need to be carefully examined.

Last but not least, and more so after the enforcement in mid-2018 of the General Data Protection Regulation in the European Union, is the management of clients’ sensitive data. This legal aspect of utmost importance must be rigorously managed internally, as the sanctions stipulated in the aforementioned GDPR can be very severe. The data acquired during the course of a campaign must be the legal property of the client and not of the agency.

It can be seen that the function of digital advertising agencies today is more focused on providing services and delivering a transparent model to clients. Let’s see which aspects are advisable to leave in the hands of an agency.

Services That Advertisers Should Outsource

 

Development of Online Advertising Technology

 

Most companies wanting to launch an advertising campaign are not specialized in developing online advertising software. For instance, it is not advisable to invest millions in designing your own ad fraud prevention tool when there exists a superior one available for a more affordable lease. It is important to own and understand the business’s technology, but advertising technology itself is inherently complex.
The same applies to software based on a very specific need. There are agencies with technical teams specialized in the relevant sector who will always do a better job identifying the technology a client needs. You can have them build it for you, without any obligation to use any of the agency’s other services.

If you are going to outsource your technology stack strategy, it is advisable to choose an agency that prioritizes simplicity. As long as there is a good level of trust, agencies should be able to make better acquisition decisions than internal teams. There are also economies of scale that agencies can leverage by using the same third-party technology for multiple clients.

Additional Training for Digital Advertising Teams

 

A significant risk when managing advertising internally is stagnation. Advertising agencies, by working with multiple clients, gain experience that allows them to continuously refine their practices. Additionally, they seek, attract, and retain experts in the field, placing them at the forefront of the sector. Internal teams have less organic development, so obtaining external perspectives is extremely valuable. That’s why you should train your internal teams externally.

Audit

 

It is crucial, for analogous reasons, to subcontract the auditing of accounts for advertising investment. It is convenient to have an external entity analyze the work, with more ease and experience to detect errors and identify opportunities, applying a different way of thinking compared to your own teams.

Gathering and analyzing data accurately is an everyday task for digital marketing agencies. Audits performed by professionals can provide information based on benchmarking accounts to recommend performance improvements, ensuring that key business decisions are not based on inaccurate data.

Services that Can be Subcontracted or Managed Internally

 

For other activities, it’s not as clear-cut whether to subcontract, what is convenient to handle internally, or in which case collaboration is the best approach. Each case is unique. However, let’s delve a little deeper into the aspects that have been left aside.

Attribution Strategies

 

An essential aspect is the attribution of conversions from a digital marketing campaign. The technical complexity of the task advises that advertisers work closely with an agency to solve this. It is not advisable for an agency to dictate the value of its own work.

Data Strategy

 

As mentioned earlier, digital marketing agencies have become, or should become, experts in data usage. Therefore, it could make sense for advertisers to outsource data strategy. However, advertisers must always own their data and always, whether they subcontract this or not, have people working for them who truly understand it.

Audience Segmentation

 

Closely related to this, audience segmentation, an essential aspect of digital marketing, must be a collaborative effort. Agencies, through the analysis of the data obtained in the campaigns, can optimize the targeting of ads for different audiences, although the final decision should always come from the advertiser, because they are the ones who really understand the brand and the broader objectives of the company.

Trafficking and Execution

 

The setup and optimization of the ads to be used is a complex mix of segmentation and targeting options, formats, and reports. Not all companies have the time and investment needed to develop the skills for the technical setup of advertising campaigns. Ad traffickers can be hired internally or at the agency, as long as they understand trends and best practices.

It is important for internal teams to stay informed and understand the main elements of these best practices. Everyone should work with the correct standards and follow guidelines to optimize performance. Almost always, refinement in practices comes with experience, an aspect to consider when deciding whether or not to outsource creative or technical aspects of the campaigns.

Finally, although it is not essential to outsource execution, it should not be left in the hands of amateurs. Agencies develop customized methodologies and technology packages for clients to better respond to challenges, automate repetitive or humanly impossible tasks, and continually optimize.

Conclusion

 

Advertisers should carefully consider what they truly need someone else to do and, beyond that, what they are really trying to achieve as a business. They can handle certain aspects of a campaign internally while outsourcing other parts.
Agencies, on the other hand, should adapt their service model to be as flexible as possible. The agency’s business model should be to do things that clients cannot do better themselves. As long as agencies focus on what clients truly need, there is no reason for in-house management to be seen as a threat to their survival. If an agent’s role is to serve the interests of their client, then the service model of the future is likely to be a significant step forward in achieving this. An exciting challenge.

MOST RECENT ARTICLES

Scroll to Top

Can We Help You?

Included by Google in the Top 3% of Spanish PPC agencies
Neotec-CDTI-logo
Subsidized by the CDTI in 2021-2023.

FÁKTICA ANALYTICS

Calle Núñez de Balboa, 35A

28001 Madrid

Spain

 

DATALYTICS

4 Portland Ct

St. Louis, MO 63108

USA

Contact: info@faktica.com
Can We Help You?

Ask Us for a No-Obligation Quote

Request a Traffic, Cost, and Potential Conversions Estimate

Ask About Our Pay-for-Performance Pricing

Get a Free Opportunities Analysis

Can We Help You?

Don’t hesitate to reach out to us