Digital technologies at the advertiser: internalisation or outsourcing?

Whether digital technologies need to be deployed internally or externally by a partner is an important strategic question for every company. Not only as a catalyst for its digital transformation, but also for its agility in quickly integrating it into the organization. To know which model best suits the organization, the advertiser must take three important elements into account: the teams, the organization itself and the financial impact.

Technological strategy?

To answer the question of whether it is best to deploy technologies internally or externally (through agencies), the advertiser must re-examine the foundations of his technological strategy: the objectives he wants to achieve, which functions meet the needs of the organization, the possible integration into existing programs and systems, the measurability of the performance and the return on investment, the maturity of the teams, the implementation speed, etc. …

In this context, however, it is also important to state that there is one invariable element in both models. There must be a clearly defined relationship between the technology vendor and the advertiser. The reasons are obvious: independence towards partner agencies, a perfect understanding of the use of the collected data, the transparency of costs, the performance evaluation capacity, and – not to be forgotten – the acculturation of the internal teams to these innovative technologies that are indispensable for a successful digital transformation.

Three elements to consider

1. Skills and team structure

Digitalization requires a vast range of skills (e-commerce, content writing, front- & back-end development, creation, analytics, paid media, social media, CRM, omnichannel …). It is important for the advertiser to create multi-purpose teams with strong digital skills, both because of the structural cost price and because of the need to continuously update their skills.

Another decision factor, besides the skills of the teams, is the evolution of the digital tools themselves. It is essential that the technologies can be managed, maintained and updated to maximize the long-term investment.

Therefore, the structure of the existing teams, the maturity of their technical skills and the ability to keep the required knowledge up-to-date must be taken into account. If these elements do not meet the required level, it is best to consider outsourcing these tasks to a specialized agency for whom these parameters are part of their core business and whose services offer a direct strong added value.

2. Agility and flexibility of the organisation

Digitalisation has caused a radical change in the growth model of companies. For many advertisers, the biggest challenge they currently face is their ability to quickly transform their organization – including its corporate culture – within the framework of a sustainable digital transformation.

The business value of digital channels no longer needs to be proven, but now the focus is on the advertiser’s agility and ability to surf the fast-paced current. As Klaus Schwab put it so well at the World Economic Forum: “In the new world it is not the big fish that eats the small one; it is the fastest that eats the slowest.”

In this context, and knowing that a key pillar of a successful transformation is the technological infrastructure, the question to be asked is:

Is my company agile and flexible enough to integrate these digital technologies into all layers of the organization?

3. Financial impact

Thirdly, the continuous evolution and the enormous amount of technologies that are offered on the market complicate the choice for the advertiser. They lead him to make long-term commitments which can have irreversible consequences for his activities.

Nevertheless, thanks to the exponential growth in the number of SaaS solutions of recent years, it is perfectly possible to minimize the financial risk of rapid economic obsolescence, although such technologies, fully adapted to needs, ambitions and available resources, are barely scalable.

The financial impact is therefore more in the formation of the teams and the recruitment of digital experts, although there is always the possibility of completely or partially outsourcing the digital transformation of the company during the transition phase.

Finally, the internal development or the outsourcing of digital technologies will require the advertiser make an analysis and a blueprint of its digital maturity. Based on this, he may then opt for internal deployment as its main growth leverage. This will enable him to process the internal skills and ultimately become a ‘self-learning’ organization, which is indispensable for a successful digital transformation. On the other hand, outsourcing is a way to accelerate the implementation of the advertiser’s technological strategy, and usually offers a faster return on investment.

This POV was written by Amaury Rosiers and Christian Remon, founding partners at G-Convert, a Connected Commerce Agency with deep expertise in e-business and the digital world. 

Our sincere thanks to G-Convert for sharing this opinion piece and for extending their approval for republication by BrainTower.