A recent article came out about direct to consumer companies keeping their advertising in house. Some experts say inside advertising or in-house ad agencies are a wave, but after reading this article, for sure it’s not really going to be just a fad. The article states four main points as to why these companies are doing their advertising in house, namely control of data, nimbleness of knowing things faster, cost savings, and intuition. Learn more about these four key points so you can better decide if inside advertising is the route for you.
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Inside Advertising
I had an awesome article sent to me by one of our head guys. He is our on-page monetization expert. Josh sent me a link to an article titled something to do with direct-to-consumer companies are keeping their advertising in-house. The title of this episode is In-house Ad Agency. I knew there was a lot of big companies bring in their advertising in-house. It’s a wave. I don’t think it’s going to be a fad after reading this article. I want to bring up the four points of the article. I believe it’s titled something like Direct-to-Consumers Bringing Advertising In-House.
There are four main points to why these companies, specifically Dollar Shave Club, a luggage brand that brought in another $50 million in funding to grow faster. Why are they doing their advertising in-house? Point number one, control of data. This wasn’t a big deal in the ‘80s when you would do TV or highway billboards. I don’t know if Johnson & Johnson cared about the data of the 37-year-old female. Now, when you’re doing advertising, especially if it’s an in-house, close to the vest social advertising, you are collecting data points. Where did they find you? How old are these people? How many clicks until they bought something? Do they read a piece of content? Did they watch a video? Did they buy after reading the content then going to a landing page?
There's so much data that software can disseminate. Click To Tweet
There’s so much data that software can disseminate. If an ad agency is doing it for you, they have the data and maybe they can have a customer service agent share the data with you and explain it, but when you’re doing it in-house, you are controlling the data. That didn’t hit me until I read this article. We have a product called $0.99 Razor and I was about to hire it out. We are not going to do that. We are going to control the data.
Number two, nimbleness. This one I had a clue on. Let’s say you go with a big agency and I do a lot or radio and other things with big agencies. We got into a trap a while back where I accidentally cut a series of commercials something to do with an eighteen-year-old. We have a product set that works for everybody. As a matter of fact, it’s free and you could be 80-years-old or 18-years-old. I was leaning on this in the commercials. I was with a larger agency as the broker, it took me a month and a half until I realized from internal people that a lot of the conversations are changing from the people looking us up from the radio. If I was doing it all myself, I would have known the second day that commercial aired. That commercial realistically cost us $5 million dollars long-term. The nimbleness of knowing things faster is a huge key point.
Number three, cost savings. I would have put this as number one, but it’s only upfront cost savings. If you do it in-house and you stink, you’re losing a lot of money, but up front, you’re saving some money. I would have put that as number one, but I would have also put it as a potential disaster. You can only bring it in-house if you’re willing to either go out and steal some great right-brain artistic minds from companies that have proven successful through these people. If you’ve never done a big viral video type of social pushes, that type of advertising, it’d be criminal to do it in-house if you’re not going to bring in full-timers to help you do it.
The fourth point was intuition. They were hinting at the fact of, “Do we trust an agency with our baby?” They went to the ball the way down to the minutia detail of how critical the brand message was from the spoken word of the commercial per se to the inbound call to the customer service, and even the message to the internal staff. What a great article, if you feel like picking it up. It changed my mind on what I’m going to do with a couple of large properties. I wanted to plant a seed there. How about considering bringing something in-house? Take care.
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