Build It, Buy It or Both? Rethinking the Sourcing of Advertising Services

23 Pages Posted: 10 Jun 2015

See all articles by Alvin J. Silk

Alvin J. Silk

Harvard Business School

Marta Stiglin

Stiglin Consulting

Date Written: June 10, 2015

Abstract

This paper provides an update on the current state of in-house agencies. Whereas traditional consideration of internalizing advertising services was framed as a binary choice of build or buy, today’s advertisers frequently pursue hybrid policies of build and buy to procure the customized bundle required to develop, produce, and implement relevant, resonant promotional campaigns. Increasing numbers of advertisers are discovering that the demand for advertising and marketing services is best served through the coordination and integration of resources from both inside and outside the company, rather than assuming that these options are mutually exclusive. A review of advertising industry history reveals why internal agencies have long operated in the shadows of their external counterparts and how the former organization form has evolved over time. The core competencies underlying the contemporary in-house agency model are analyzed and the competitive position that in-house agencies presently occupy in relation to external providers is assessed. Two case examples of successful internal/external agency collaboration are presented. Finally, recommendations are offered for advertisers seeking to bring their internal and external agency resources together and arrive at a more-collaborative operating model for advertising services.

Suggested Citation

Silk, Alvin J. and Stiglin, Marta, Build It, Buy It or Both? Rethinking the Sourcing of Advertising Services (June 10, 2015). Harvard Business School Research Paper Series # 15-093. Available at SSRN: https://ssrn.com/abstract=2616273 or http://dx.doi.org/10.2139/ssrn.2616273

Alvin J. Silk (Contact Author)

Harvard Business School ( email )

Soldiers Field Road
Morgan 270C
Boston, MA 02163
United States
617-495-6036 (Phone)
617-495-8736 (Fax)

HOME PAGE: http://dor.hbs.edu/fi_redirect.jhtml?facInfo=bio&facEmId=asilk

Marta Stiglin

Stiglin Consulting ( email )

Post Office Box 823
Andover, MA 01810
United States
(978) 609-7825 (Phone)

HOME PAGE: http://www.stiglin.com

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