Could your business benefit by operating paid media in house instead of an agency model?

That's a question that many CMOs are asking themselves as they review their marketing cost effectiveness. Here’s how the transformation to in house of a leading UK car and home insurer played out in 2021, supported by our principle consultant:

Background:

In 2019 the incumbent performance marketing team, successfully transitioned the email channel in-house as a first phase. The implementation of Salesforce enabled enhanced email campaign automation and the opportunity to extend this capability to other marketing channels.

The next phase involved removing the reliance on existing media agency relationships to move digital channel management in-house. This included Google pay per click advertising, Facebook paid advertising and search engine optimisation (SEO). This resulted in full campaign control, improved agility and supported the transition of the performance marketing team into a centre of excellence befitting one of the UK’s leading insurance brands.

A target operating model to support this transition from existing to future state was designed incorporating best practice insight from Gartner and ISBA, duly accepted by the executive senior stakeholders.

Objectives:

• To equip the performance marketing team with the skills, processes, and relationships to directly execute best in class digital campaigns, increasing agility and speed of reaction to market forces

• Migrate marketing activity from agency to in-house whilst maintaining performance targets without disruption

• Identify and fulfil the capabilities, technology and resources needed to deliver marketing campaigns in-house including tool sets and reporting

• To maximise effective use of increasing spend and deliver cost savings by buying direct and forging strategic relationships with the world’s leading digital media brands such as Google and Facebook

• To further promote a performance culture across the organisation

Benefits:

• Remove reliance on agencies for campaign execution and improve efficiency by removing agency margin on media spend

• Increase agility and speed of reaction to rapidly changing market forces

• Increased team skills, expertise and knowledge

• Develop stronger, direct relationships with media owners

• Leverage first party data more effectively

• Operate a lean and automated (where appropriate) marketing operation

• Direct control of consistent messaging and audiences

What they did and how it was done:

• A rigorous supplier selection process, selecting an accredited Google Marketing Platform partner to support the transition

• Establish relationships with other internal teams, particularly procurement, benchmarking with technical sourcing teams

• Developed a structured and considered target operating model covering the process, technical, cost and people changes, drawing on expertise from Gartner and ISBA

• Recruited a brilliant team – undertaking bespoke training programmes, blending resources from Google’s Skills Shop, Facebook’s Blueprint and Jellyfish Training

• Worked collaboratively with the internal marketing channel specialists to secure buy-in to the high amount of change and training involved

• The existing internal analytics specialists designed innovative reporting dashboards integrating disparate data sources using visualisation tools

• Took control and gained a full understanding of their marketing tech stack instead of relying on agencies to manage this

• All related operational governance and risk documentation was re-written to complement the new operating model

• Implemented project management tool enabling all task times to be calculated and resource levels managed

Results and outcomes:

• Upskilled the existing team and augmented the resource level by recruiting in the right additional talent which is the foundation for the successful operation

• Reduced first year annual media costs by circa £500k by removing agency commission and retainers with an estimated 3 year saving of circa £1.5m

• Saved £30k annually by re-evaluating SEO tool sets and selecting three data suppliers to provide all the data necessary to manage effectively

Pre and post in-housing PPC performance increases:

• Click through rate (CTR) increased by circa 18% Yo2Y

• Cost per sale (CPS) reduced by circa 65% Yo2Y

Post in-housing SEO performance increases:

• Highest volume generic key phrase increased from position 4 to 2 delivering an average increase in CTR, for this keyword, by circa 8% and an average increase of circa 43k clicks per month

Final observations:

People:

When the RFP for in housing partners was conducted, all seven prospective suppliers emphasised that getting the right people in place was key and this has proved to be the case. In this particular transition, the right people with the right skills were recruited but there is greater resulting impact if anyone leaves. This risk could be mitigated by investing in a continuous pipeline of new digital talent, possibly via the digital apprenticeship scheme.

The digital analytics specialists were vital to the project, but it became evident that they too needed to consider bolstering resource to keep pace with the extra work necessary for an in housed operation, especially with large scale transformation projects such as Google Analytics 4 and Conversion API facing advertisers in 2022.

The Jellyfish training offering had very good feedback and it proved to be useful to continuously review training needs, particularly with new starters, using their courses.

Technology:

As a next step, integrating Facebook into SA360 using a PMD platform like Smartly could be a game changer in terms of influencing team shape as it provides the functionality to run Facebook campaigns in the same platform as Google and Bing meaning that the search team could become truly multi-channel specialists and move budget around quickly in one place. The Smartly social creative suite also looks like a potential huge time and efficiency saver.

Administration process:

Processing invoices from the media giants should not be underestimated as a key function. This was implemented and similar to how this was previously managed via agencies, but it is vital to ensure that everyone in the chain understands their responsibilities, including the finance team. Inadvertently unpaid invoices could cause total media accounts to be suspended with serious commercial implications. The in housed team need to stay on top of this to make sure the whole cycle is well managed.

If you are considering in housing your paid media operation and not sure how to get started, then get in touch to find out more about our consultancy service.