Why Are Retailers Bringing Marketing In-House?

Online retail marketing efforts are increasingly being brought in-house rather than outsourcing to external agencies.


StitcherAds has quite a few customers who made that shift. Flash sale sites, often an early indicator of trends in marketing, tend to experiment with agencies and managed service partners. But often they find that the velocity and variety of changes in targeting and creative dependent on other silos of company information – rapid changes in inventory, changes in price, the need to act quickly – can make a successful agency relationship built around direct response advertising goals tricky, if not impractical.

So we weren’t shocked to see the results of a recent survey conducted by the Association of National Advertisers in 2013, 52% of marketers were assigning a portion of their newer marketing strategies, including digital, mobile and social strategies, to their in-house teams. However, with the unprecedented rise of mobile in recent years, a commonly cited problem is the lack of in-house experience and knowledge regarding mobile marketing, yet many outsourcing agencies are also failing to embrace the power and potential of mobile. Currently, around 42% of marketers use mobile marketing extensively, and the number is constantly increasing along with the greater demand for in-house expertise. As a result, approximately 50% of companies are still outsourcing their mobile marketing campaigns either in part or in whole.

The opportunities and challenges of in-house marketing

The move to in-house marketing presents a range of advantages, but it is certainly not without its challenges. For a start, relying on an internal marketing team can lead to bias and sub-par customer satisfaction research. Another major drawback is the resources which online retailers will need to have at their disposal, as their own in-house team take care of their marketing efforts. Retailers will need to have access to the same tools, software and expertise as external marketing agencies do, which inevitably leads to greater budget requirements; though, the higher costs should be more than made up for by the long-term gains.

In spite of what could be perceived as barriers to in-house marketing, almost a third of online retailers intend to take their marketing efforts in-house in the near future, a decision partly motivated by the rise of mobile and the increasing emphasis on more localized and personalized marketing efforts. The most commonly cited reasons for the move to in-house include a far greater degree of flexibility with regards to optimizing and personalizing the marketing process to meet more specific requirements, closer monitoring of expenses and better quality control. With in-house marketing, CMOs have more control over the entire process, potentially leading to speedier results and a marketing campaign which is better suited and tailored specifically to their company.

The decision to take marketing efforts in-house is one that is increasing in popularity and when companies are seeing an improvement in quality, control, and process, it is clear why.

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