Time for the industry’s sexiest topic: Programmatic media buying. Hold on, hold on, before we lose you. If you’re a marketer, you might want to pay attention. As with the rise of in-house creative agencies, some companies are starting their own media operations—specifically, programmatic buying.
The Association of National Advertisers, ANA, drew attention to the shift in 2016, finding *major* transparency concerns between agencies and clients. In turn, marketers started saying, “Screw it, we’ll do it ourselves”— choosing to assert more control over the ad buying process.
Big names like Chase, Molson Coors, and Ally Financial have brought some of their media functions in-house over the past couple of years.
According to an ANA survey from 2018, 36% of more than 200 marketers said they handled media services in-house vs. 22% in 2013; 24% had taken programmatic duties in-house.
Cutting out the middleman
According to Ana Milicevic, a digital marketing consultant and co-founder of Sparrow Advisors, there are a few reasons why brands start shifting media to in-house: it’s cheaper (they hope), more transparent, and the company’s marketing department gains new skill sets.
Milicevic told Marketing Brew some brands question why they’re paying for an outside agency’s media services, a “fairly expensive intermediary layer,” when they could do the work themselves and save some $$ along the way.
Pharmaceutical giant Bayer—which manages every piece of its digital media investments within its consumer health division—went in-house in 2018, wanting to be closer to the action. “While an agency is effective in managing strategy...they are external partners and distant from the day-to-day needs of our brands,” wrote Jeff Rasp, head of media, digital platforms, and content at Bayer, to Marketing Brew. “This was by choice so we would have end-to-end ownership, from strategy to measurement and everything in between.”
Ally Financial started the *the journey* in early 2019. By the end of 2021, all digital media will be handled completely inhouse, the company’s CMO and head of PR Andrea Brimmer told us. “We were demanding more transparency into the buying process,” Brimmer said.
Previously, Ally relied on the typical chain of command inside a media agency, where a report or memo had to go through three or four different channels before being presented to the team.
Now, Brimmer and her team get the “raw and unfettered” data in real time. In practice, that’s made her team quicker to A/B test display ads, create content at a faster clip, react in the moment, and get a deeper understanding of their customers’ journeys.
“That’s all much slower when it slips outside the walls of your brand,” Brimmer said.
Like many companies that have made the shift, Ally made the transition with help from its media agency MediaCom, which still does linear buying for the financial services provider.
Timing is everything
Bringing media capabilities in-house can be quite the undertaking. For starters, it takes time.
Cullen Urbano, VP of consulting and marketing transformation at Media.Monks (formerly MightyHive), a firm that aids brands as they start the shift, said it can take anywhere between six months and four years.
“The biggest misconception about in-housing is that it’s just, ‘We need to hire people and we need to teach them how to buy programmatically,’ or, ‘We need to teach them how to buy social,’ ” he said. “A lot of marketers don’t actually understand all of the functions that their agencies have been doing on the backend.”
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Plus, Greg Wright, VP of content marketing at the ANA, said the initial investment cost is high.
“It’s a strategy that you have to commit to. It’s not, ‘Let’s do it for a year and see how it works,’ ” Wright noted, explaining that companies need to invest in the right tools and tech to get everything up and running. “It’s not gonna happen overnight. It will take a couple years, probably, before that investment pays off.”
Staffing strife
Hiring for these roles isn’t exactly a walk in the park, either. For instance, Milicevic described many of these positions, particularly programmatic-related ones, as “deathly boring.”
She explained these roles can be “quite monotonous” if they’re not able to drive strategy. “In early in-housing implementations, the in-house team was often sold on being able to impact strategy but in reality it wound up being quite tactical: they’d get a fixed budget and media mix model, and were just meant to tweak the buttons until quarterly results.”
Even if the role itself isn’t all that bad, there’s a chance employees will get bored working on the same brand day in and day out. As Milicevic puts it, even if everything is going well, “There isn’t necessarily much variance, so you might start feeling underchallenged a lot sooner than you otherwise would.”
Nicole Kane, director of precision and digital marketing at Molson Coors, agreed, noting that there can be limited opportunity for career progression with a solely in-house team.
“I know many brands who are concerned...if [they] bring [their] own staff in-house with programmatic, and they’re junior staff, where do they go next?” she said. In practice, Molson Coors doesn’t work with an agency for programmatic media, but has a dedicated team within advertising platform Amobee, which handles buying on behalf of the company.
“Today at Molson Coors, what ‘in-house’ means is that we own most of our technology contracts,” Kane explained.
Wright said the specialized and relatively new nature of programmatic roles also makes hiring difficult. “I don’t think there’s enough people that are heavily invested in the knowledge of how to do it and what it takes to manage. At the same time, kids in college aren’t sitting there going, ‘Yeah, I want to be a programmatic media buyer.’ ”
Despite these hurdles, marketers are finding a way to make it work. Ally Financial’s Brimmer said its in-house media team has grown from one digital marketer to more than 20 since 2019. According to Brimmer, she’s found success so far by taking things slow.
“We didn’t have the internal infrastructure we needed in place. The reality didn’t match the dream. We had to build it,” she said.
Brimmer projects that over the next few years, Ally's shift to in-house in 2019 will save as much as 30 to 40% of their marketing budget, though she didn’t provide specific figures to Marketing Brew.
Minda Smiley contributed to this story.