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Industry Contributor 20 May 2019 - 3 min read

PepsiCo and Anheuser-Busch InBev go in-house

By Paul McIntyre - Executive Editor

Anheuser Busch is officially launching its own in-house full service agency (AdAge), while PepsiCo is hiring a media and data team as it continues to take agency duties in-house (The Drum).

 

Key points:

  • AB InBev has been building out agency – Draftline – for a year. Employs 35 people on creative, 20 in media and data, including programmatic media buying
  • Rationale: agility in using data to improve ads and targeting, plus cost savings
  • PepsiCo hiring ad tech managers and analysts, CRM and data specialists
  • According to this job ad, PepsiCo aims “to create a holistic audience acquisition and activation capability inclusive of 1st party, 3rd party, social, and connected partner data”
  • Continues PepsiCo’s insourcing trend, with aspects of creative, content and social already in-house

Another sign that big brands are backing their own data and ability to execute as a result of market and regulatory shifts. The challenge for brands is finding the right people, partners and technology to deliver high quality results. Though that’s no different whether in-house or outsourced – and there is now an army of consultants touting their ability to help brands set up in-house shops and systems.

While some brands will argue otherwise, much of the shift comes down to money. Marketers are under increasing pressure to do more with less, faster: A 2018 survey of 412 marketers on in-housing by the ANA found cost efficiency was top ranked benefit by a wide margin. The ANA said transparency and trust are also drivers of in-housing of media buying. However, while eight in ten of those brands had taken some aspects of advertising/media work in house, only three in ten, for now, have programmatic capability.

Data regulation and privacy concerns are also a big factor in streamlining digital supply chains as brands question the value and compliance of some third party data. Those challenges are being compounded in the face of changes recently outlined by Google and others, as well as the definition of consent.

Ultimately, however, 90% of the ANA members with in house teams say they still work with agencies. Whether AB InBev will trim its 50-strong agency roster to the extent that PepsiCo has in recent years remains to be seen. But by pitching alongside its agency partners for work, it will undoubtedly put further pressure on agency margins.

What do you think?

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