German pharmaceutical company Bayer, maker of consumer health products such as Aleve and Advantix, is on a two-year mission to bring all media in-house. Bayer began building out its in-house programmatic operations in March 2017, and currently has a 10-person internal team that works in tandem with GroupM agency MediaCom on media buying. But starting in 2019, Bayer will drop this hybrid model and grow its internal marketing team to 20 or more people to handle everything from the strategy and planning of media buys to their execution.
“We realized that if we really wanted to be leading edge marketers, then we would need more expertise in the building, not only from a strategic level but a tactical level,” said Josh Palau, vp of digital strategy and platforms at Bayer.
Palau, who first spoke about this during presentation at the Programmatic I/O conference in New York in October, said the company is moving its media in-house to accomplish a variety of goals, including to increase the company’s own internal expertise around marketing, to drive better performance of its buys and decrease the cost of its buys and cut off agency fees. Palau would not say how much the company expects to save from the move, but that there will be cost-savings and more that the company can then put into marketing.
“If you’re a search person, you may be great at search, but you’ll be a thousand times better if you understand the category you support and the consumer journey,” said Palau. “You only get that when you are part of the brand team. You also don’t get that in a hybrid model because while my search person is great, she can’t be as deep on 15 or more brands.”
While bringing all media in-house is still a rarity among companies, the overall push to move services in-house is strong, despite issues with talent. The ANA estimates that 78 percent of brands are creating some kind of internal structure, versus 58 percent in 2013.
“It is arguably more economical, and the team may be more easily brought up to speed as they are part of the company’s DNA,” said Chris Allieri, founder of communications agency Mulberry & Astor. “Companies of all sizes are seeing that the old-school agency-of-record model doesn’t work for them. It’s costly, it’s inefficient and, oftentimes, one large agency doesn’t present the best team or best work for the job all of the time.”