In-House vs. Outsourcing: AI-Driven Shifts in Marketing & Comms

This summary highlights key insights from our roundtable for Marketing & Communications Center Members discussing "The Ins and Outs: Rethinking the In-House vs. Outsource Equation." Decisions about what to insource or outsource remain a constant focus for marketing and communications leaders, especially as AI expands what can be done internally. At the same time, the demand for specialized skills—such as analytics, digital technology, and corporate diplomacy amid ongoing (geo)political changes—is rising.

Trusted Insights for What’s Ahead^®

• Outsourcing levels remain steady overall but seem to be tapering off to some extent as AI-based in-house capabilities increase.
• AI boosts internal team capacity—welcomed by some, resisted by others—and strengthens marketing and comms teams' negotiation power with external partners.
• Decisions to insource vs. outsource are usually not a strict either-or choice. Instead, it's about thoughtfully combining capabilities to achieve the best results. It makes marketing and comms leaders orchestrators of internal and external resources and skills.
• Insourcing protects confidentiality and enables proprietary advantages. Outsourcing offers specialized expertise beyond internal resources.
  
  

Has Outsourcing in Marketing and Comms Decreased Recently?

About half of our roundtable participants report no change in outsourcing levels over the past 18 months, while the rest indicate a modest decline (Figure 1). This likely reflects growing in-house capabilities supported by AI tools. Indeed, companies seem to expect having upskilled, restructured teams as digital capabilities evolve. Expertise, quality, cost, and speed are the main factors influencing companies’ decisions to outsource marketing and communications work.

Figure 1. Outsourcing remains steady, although it’s slightly slowing—likely due to growing AI-based in-house capabilities

How Is AI Impacting Insourcing and Outsourcing Decisions?

AI greatly increases the potential to bring more marketing and communications in-house. Roundtable participants note both enthusiasm and hesitance toward AI, as some team members see AI as a threat and worry about job loss.

“AI really can help us in terms of how we get things done. But I'm finding my internal creative services team really hesitant. They see AI as a job eliminator. It is a way to take some of the more time-consuming, task-driven, administrative work off their plate and allow them to spend more time with the strategic, creative thought and development. Why do you want to spend time on imagery editing when really you should be thinking strategically creative, what should I be developing holistically?”

Industry changes have led companies to renegotiate with vendors. One firm sought cost savings from vendors due to AI. Another streamlined agency partnerships to integrate services and limit the number of marketing partners. This was inspired by consolidation in the agency sector.

Marketing and communications leaders estimate that AI could replace up to half of marketing tasks (Figure 2). While they see some overhyped AI expectations, they highlight AI’s benefits, including for individual team members, such as allowing them to focus on higher-value work and gain new skills.

“But I also think we need to be aware of how much hype we are hearing from the AI companies themselves, the people who are promoting these tools, consultants included. AI does not have that kind of judgment or discernment or experience to draw on, and it makes too many mistakes.”

“Let's face it, across many aspects, AI will replace, and is replacing, certain jobs. But it doesn't mean that people can't either find time to think more strategically and contribute in other ways, or that they can't also reskill in other areas. So, I think it's a matter of how it's presented.”

Figure 2. Marketing leaders anticipate AI to handle up to half of current marketing tasks in the next 3-5 years

Why Do Companies Keep Marketing and Comms Tasks Internal?

Companies often insource to protect confidentiality and gain a competitive advantage. Important sensitive tasks like market intelligence and data analytics are often kept in-house to maintain data security, align with strategy, and preserve proprietary models. Centralizing data also enables specialized teams to respond efficiently to internal requests. One company reports that they insourced more over the years, building an internal marketing/ad agency and outsourcing only strategic, big-budget projects that require external expertise. Insourcing helps to maintain continuity. Agency teams change, which is harder to control than internal change.

Why Do Companies Outsource Marketing and Comms Work?

Outsourcing is mainly driven by the need for specialized expertise not available internally. Roundtable participants hire external experts for tasks like content creation, video production, creative strategy, media planning and buying, and marketing strategy (Figure 3). External agencies have a broader perspective on the cultural landscape, customers, and external context. Treating external partners as integrated team members helps make collaborations successful, especially in creative work.

“Success is when you are able to onboard agencies that become an extension of the team, and the two can mesh together, learn from each other, push one another, and pressure test the ideas. That's where the magic is and where you get the best work because agencies are bringing outside ideas to the table.”

Figure 3. Content creation, creative work, media planning, and strategy are most considered when deciding what to insource vs. outsource

External vendors can temporarily expand teams and fill gaps. For example, a company with limited resources used external partners to complete projects and support business growth. External vendors may also fill interim needs until reorganizations have been implemented.

Often, it’s not an either-or decision, but a deliberate blending of internal and external resources. Deliberately blending in-house and external resources combines the best of both worlds. It makes marketing and communications leaders an orchestrator of skills, joining internal and external capabilities as needed for certain tasks and projects to achieve the best outcome.

Aligning with this, our recent research found that among the C-Suite, chief marketing officers (CMOs) and tech leaders are most concerned about skill development, driven by the need for specialized expertise that changes constantly in marketing, including digital tech, AI, and analytics. This finding suggests CMOs are in a position to create skills-based teams—a way to more flexibly staff projects and tasks, pulling together the appropriate skills for certain objectives. It also highlights a promising career opportunity for marketing talent—one that CMOs are well suited to champion.

“We have been doing this with our creative department, going person by person, who's leaning into AI, who is really good with the tech challenges, who's really conceptual. We're building out our in-house resources based on some of those skill sets and capabilities. When push comes to shove, if you need a specific resource, we're going to move things more quickly into highly specialized teams so that we can move it through the system faster, smarter, and get better output.”

About This Summary and the Authors

The Marketing & Communications Center team thanks all roundtable participants for their valuable input during this lively roundtable discussion held under the Chatham House Rule.

This article was written by the below authors based on their own human synthesis of the AI-transcribed notes from the roundtable discussion. In some spots, the draft language was polished with the help of AI. The quotes were lightly edited for clarity and readability, while preserving original meaning. The graphics were created manually.