More than three-quarters (78%) of Australian marketers work with an in-house agency, and 80% of marketers are considering or already using AI for content creation, according to a new report.
The findings from the second ‘In-House Agency Landscape Report’, created by the In-House Agency Council (IHAC) and Kantar reveal a growing Australian in-housing sector, which is just behind the US and Europe in terms of in-house agency penetration.
The research revealed 78% of marketers use a hybrid model of both in-house and external agencies and almost all marketers (93%) believe in-housing has a “positive effect” on the bottom line.
The average Australian in-house agency has between five to 25 people and covers seven different capabilities, predominantly creative, social media, content marketing, strategy, and video production. Three-quarters (74%) of these anticipate increasing workloads in 2024.
Half of Australian marketers (51%) believe AI can simplify content creation, with four out of five marketers currently exploring the incorporation of AI into their marketing creation processes. However only one-quarter think it will directly lead to more cost-effective campaigns.
IHAC executive chairman Chris Maxwell said the report revealed the local market was maturing quickly with the economic pressures helping to accelerate growth.
“17% of IHA’s have launched in the past two years, demonstrating that the shift is gaining momentum with adoption of the model growing at nearly double the rate seen in 2021.”
“With broader remits and continued economic pressures, IHA’s foresee their workloads increasing while reducing the amount of work they procure through external agencies. However, for marketers with an IHA, the list of benefits is long, and goes well beyond just cost efficiency and into better knowledge of brand, speed and agility, along with having dedicated staff,” said Maxwell.
Kantar Australia manager director Jacqui Brandt, said the research reveals the “important interplay and role that internal and external agencies play and how best to leverage the strengths of each – be that around the work produced, the way media is planned and bought, and the tools used to inform business outcomes.
“The spotlight on AI is particularly fascinating and we’ve learned that 80% of marketers are considering or already using AI for content creation. While cost effectiveness is yet to be understood, AI is here to stay and embracing AI and seeing it as complementary to the agency toolkit is essential.”
The report, which aims to provide a snapshot of the local in-house agency landscape, includes data from client-side marketers, in-house agency personnel and marketers that use both internal and external agencies.