• Transform magazine
  • July 18, 2024

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The house always wins: the rise of internalised creative

Captain Copy

The past 15 years has seen the rapid expansion of in-house agencies all around the world. With their growth showing few signs of slowing down, Jack Cousins explores how they’re built, the misgivings creatives have for them and how the gold standard of in-house design can be achieved.

The late 2000s provided the perfect storm necessary to disrupt the relationship between brands and the people who meet their creative needs. First, the 2007-2008 financial crisis shocked global corporations and had a huge impact on their psyche regarding costs. Combine this with a second world-changing phenomenon – the advent of the iPhone, ushering in the age of social media – and multinationals were capable of connecting with consumers everywhere at every moment. They began to question where the most optimal location was for their creative; external or in-house.

Fast forward 15 years and it appears a general consensus has been reached: in-house agencies, to at least some degree, are a necessity for large organisations with a global reach. Research by the Association of National Advertisers can leave us in little doubt that a sea change has taken place. In 2008, just 42% of their US-based members reported they had “a department, group or person that has responsibilities that typically are performed by an external advertising or other MarCom agency.” By 2023, that number had spiked to 82%.

While the number of full-service in-house agencies is far lower, they also appear to be on the rise. And with the full economic and cultural impact of Covid-19 still being assessed by businesses, and novel forms of technology and social media adding further uncertainty and opportunity alike, who’s to say further resources won’t be allocated to in-house creative?

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The need for something different

One notable company to recognise the power of moving creative in-house is Careem, the Dubai-based super app. Founded 12 years ago as a ride sharing app, the company quickly evolved into something far larger. MENA’s first unicorn was subsequently acquired in 2019 by Uber for $3.1bn. Now offering a far greater variety of services, including online food ordering, digital payment and grocery delivery, Careem realised it needed to be a little more disruptive to change the company’s perceptions as a mere ride-hailing service.

Further problems came from Careem’s mixed history of utilising in-house design across some of its territories with external agencies supporting big campaigns. The consistency and quality of the brand were inevitably being diminished without a centralised creative hub (and vision), and the cost inefficiencies of this hybrid system were also causing further strain.  

Careem’s global head of brand and creative, Tom Sword, was brought onboard in 2021 following a successful period at Hala – a service which allows its users to book Dubai taxis through Careem’s app – where he created and launched its brand. Sword’s first impression in the role was that Careem needed to do two things: rebrand to change perceptions and then support that redesign with world-class creative. Initially thinking the right move was to ask design agencies for help, Sword quickly realised the sheer speed and volume of creative work for an everything app would require a different strategy.

He recalls, “[The business] was moving so fast that we didn't feel we could find an external partner that would have the understanding to support us. Instead, what we decided was to build this brand in-house. I had a vision that we would get maybe a ten-person team, have a basic understanding of brand strategy and then focus on bringing in teams of copywriters and designers who could build out most of the content that was needed for ‘business as usual.’”

Two-and-a-half years on, however, and The Creative Studio, as Careem’s fully operational in-house agency is known, has grown to accommodate 30 staff members. While Sword admits the process was “chaotic” at first, he also believes the quality of creative work his team has produced is of a world-class standard, and directly linked to the vision he set out early on of replicating the culture of a design agency.

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This ethos was evidenced in the Careem rebrand itself, which saw the crafting of sub brands for its Pay, Food and Quik services such that they could exist within the broader brand house. Smart visual tweaks also helped evolve the feel of the brand and has been heavily rewarded post-launch by an abundance of new non-ride hailing users.

But Sword’s favourite Careem work to date is ‘Dirhams for Delays,’ a campaign which promises to reimburse customers AED 1 for every minute a food order is late. The concept came from the team asking itself how they could carve out a niche and stand for something customers really care about. Realising people’s days can be ruined by a late food delivery, The Creative Studio worked closely with Careem’s operations team to work out precisely what the campaign would cost the company. These internal negotiations paved the way for the company’s most successful ever campaign. According to Sword, this is something that would have been “almost impossible” for an external agency to accomplish.

He adds, “That campaign, out of everything we've done, is probably the one I'm most proud of, for exactly the reason that it could only be done in-house. I think you have to be so in tune with the actual strategy of the food business to be able to propose and pull off something like that.”

But isn’t in-house boring?

Careem’s move in-house has undoubtedly proved very successful thus far. Sword even reveals that The Creative Studio has been approached on a number of occasions by businesses completely unrelated to Careem, asking them to be their design agency. Sword has actually accepted a couple of these offers which perhaps represents the evolving nature of in-house agencies. One issue this might help iron out is the stereotypical concern creatives have about in-house being a dry experience, where you forever fixate on one brand and let creative talent go to waste.

This was certainly a concern Australian brand designer Emily Matthews had before making the in-house switch to property development manager Fortis. Having previously worked for a number of Sydney-based design agencies, including Monogram and Designworks, Matthews received a call from a former colleague in 2020 who had since become Fortis’ head of marketing. She explained to Matthews the directors’ frustrations of using design agencies at great cost and the work not hitting the mark, and asked whether she would like to fix this as design director.

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Despite being a great opportunity to play an instrumental role in shaping a young and ambitious company’s brand, Matthews had strong reservations about the job. It was hard to see past the stigmas of moving in-house, especially when she had seen peers make the switch and end up doing the menial, everyday work, while all the new and exciting campaigns were put out to tender. As someone with strong personal ambitions who wanted to make a difference, Matthews wasn’t sure a move in-house was for her.

She says, “There’s a perception out there, that moving in-house can mean rolling out a core brand, and not necessarily leading creative campaigns or having the creative flex that agency projects offer.”

But Matthews underestimated what Fortis could bring to the table. For starters, the property developer was already a design-led organisation with expertise in architecture and interior design, so was in a position from the get-go to really appreciate her creativity. Matthews was also seduced by the breadth of areas she would be designing brands and campaigns for, including residential, commercial leasing and hospitality. Combined with the fact the company also operates in Melbourne and Brisbane alongside Sydney, staving off boredom wouldn’t be a problem, so she took the job.

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Matthews admits there are challenges too, such as limited budgets and sometimes missing the thrill of working across different industries. Another issue of leading an in-house team is trying to hire top talent – a common theme across industries and regions. To overcome this, Fortis crafted a portfolio website demonstrating to designers that exceptional creative can be – and is – accomplished there. Furthermore, Matthews – now head of creative – believes working in-house offers designers a unique and important experience in their careers.

“When I look back now to my last role in an agency, sometimes I think I was stabbing in the dark; we would do our research and sometimes we got it right, sometimes we didn’t,” she says. “But coming in-house, I am so much more aware of all the strategic business decisions, which is so helpful in terms of designing. As long as the in-house creative team has some really good leadership, so designers can keep learning and be nurtured, I think it's a really good skill set to have.”

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Can-do attitude

Finding strong leadership to head up smaller in-house teams is challenging enough, but what about when the operations are scaled up to an enormous 17 design centres around the globe, housing over 350 employees who work across dozens of brands? This is the task Mauro Porcini faces daily in his role as SVP and chief design officer at multinational food, snack and beverage corporation PepsiCo.

For Porcini, who helped found PepsiCo Design + Innovation 12 years ago, his mantra from day one was to ensure the creative work was ‘glocal’ in nature. “This means globally strategic, locally relevant,” he clarifies. While working in a previous role, Porcini realised the company’s global design was struggling as it lacked local creatives. Requiring designers to live and breathe the territory’s culture is imperative, but Porcini adds they then need to be directly connected with the central creative hub.

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He says, “The centre needs to identify the [creative talent]. You then manage their career path, inspire them and build your global strategies together with them. You must respect them and empower them to do what they think is right with those global strategies locally.”

This strategy of hiring top quality local talents and giving them a degree of creative free reign has worked wonders for PepsiCo. In little over a decade, the in-house agency has scooped up over 2,000 design and innovation awards, and is widely considered the gold standard of how to run in-house design.

This is a far cry from where the company found itself when Porcini was brought onboard. With the work being completely outsourced to external agencies, Porcini considered PepsiCo’s design inconsistent, not strategic and inefficient. Quality had to improve, and one area targeted early on was Pepsi’s brand.

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Redesigned a few years prior in 2009, it was found that some regions didn’t embrace the new identity which led to global fragmentation and inconsistency. The minimalistic and perhaps over-sophisticated design was tweaked by Porcini and his team at the time by infusing greater vibrancy and increasing the logo size on packaging. However, the team wasn’t in a position to craft a complete overhaul, so the ‘Big Bold Blue’ design – as it was known – remained until a further update in 2013.

Still not satisfied, the team experimented with designs in the following years, feeling something more energetic was possible. Eventually the opportunity came to contemporise Pepsi’s brand, with last year’s redesign combining electric blue and black to signify its Zero Sugar offering. Representing a complete overhaul in design thinking from PepsiCo’s pre-in-house existence, the brand’s boisterous wordmark now sits inside the logo with uppercase letterings.

Indeed, the rebrand is emblematic of PepsiCo Design + Innovation’s 12 years at the wheel, and Porcini believes the work is the crown jewel of his team’s brand design accomplishments. It’s not just consumers who appreciate the redesign, he adds, but also PepsiCo’s internal audience. His in-house team was in a unique position to craft a redesign which everyone could embrace, and Porcini claims this has generated a lot of internal pride and excitement. The feel is decidedly different from the design update 15 years ago.

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But not all in-house agencies are in a position to replicate this success. After all, creative talent (and budget) is a scarce resource. Given in-housing is a hefty fixed cost, there comes a point where some companies have to throw up their hands and accept that outsourcing creative – or developing a hybrid model – is actually the more effective option for them.

While research from the World Federation of Advertisers and The Observatory International indicates that 70% of multinationals now have in-house strategic capabilities, it also notes many more are planning on shifting tasks away from external agencies in the coming years. It therefore seems the world’s biggest brands now understand the potential power of internalising creative, but only time will tell if they have the people, budget and patience to make it work.  

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This article was taken from Transform magazine Q2, 2024. You can subscribe to the print edition here.