Bringing marketing analysis in-house | Explaining the advantages and disadvantages

Marketing analytics has become an essential element in modern business. As data-driven decision-making becomes more and more important, companies need to analyze marketing data to develop more effective marketing strategies.

Although it is possible to outsource marketing analysis, many companies are considering bringing it in-house. In this article, we will explain in detail the advantages and disadvantages of bringing marketing analysis in-house.

What is in-house marketing analytics?

In-housing marketing analytics means that a company builds and implements data analysis skills in-house, meaning that the data analysis processes and tasks are handled by in-house people or teams, rather than relying on external experts or third parties.

To achieve in-house marketing analysis, it is necessary to hire and train specialized personnel, as well as introduce the tools and systems necessary for data analysis.

Benefits of In-House Marketing Analytics

-Adapted to your unique business needs

In-housing allows companies to perform custom analytics tailored to their specific business needs and strategies.

When hiring external experts or consultants, they will base their analysis on cutting-edge analytical methods and best practices, but it can be difficult for them to fully understand your company's specific needs and strategies and incorporate them into their analysis.

In-housing allows companies to combine their own data with deep business knowledge to deliver better analysis.

-Allows for near real-time data analysis

In-housing allows companies to manage the data analysis process in-house, theoretically enabling them to collect and analyze data in near real time.

When outsourcing to external experts or consultants, it can take time to provide the data for analysis and create reports. On the other hand, when in-house, these times can be shortened, allowing for faster analysis. Furthermore, because the data is always up to date, you can discover problems early and make quick decisions and take action.

・Cost reduction and improved operational efficiency

Cost reduction

By bringing data in-house, companies can reduce the cost of consulting and labor costs that would otherwise be paid to outside experts, thereby reducing the costs associated with data analysis.

Improving work efficiency

By going in-house, you can expect to improve the efficiency of your analysis work by managing and implementing the data analysis process within your company. When outsourcing to external experts or consultants, communication costs and the labor required to provide data are incurred, and there is also a slight time lag in the progress. Going in-house can solve these issues.

Disadvantages of In-House Marketing Analysis

・Securing personnel with specialized knowledge

Securing personnel with data analysis skills is a key issue when going in-house. Data analysis requires a wide range of skill sets, including knowledge of statistics and mathematics, programming skills, and skills in data interpretation and modeling. In addition, to correctly interpret the analysis results and turn them into actions, business and marketing knowledge as well as an understanding of industry characteristics are also important. Many companies struggle to hire personnel with these skills, as they are difficult to recruit. Furthermore, in order to hire the best talent, a rigorous selection process and appropriate talent evaluation criteria are necessary, and the time and effort required to design these systems are also an issue when going in-house.

Risk of bias

In-house data analysis can be influenced by the biases of company personnel and decision makers. The more familiar you are with the business, the more difficult it is to eliminate subjectivity and preconceptions, which can lead to bias in the analysis results and their interpretation. Being biased towards certain information or ignoring elements that should be incorporated into the analysis can prevent accurate judgment and strategy planning. It is important to introduce guidelines and frameworks to eliminate bias as much as possible during the in-house process.

Please also read this detailed article on bias.

What is bias? Its meaning and types [including points to note when analyzing data]

・Necessity to ensure reliability of analysis

In-house marketing analysis requires that you ensure the trust of the analysis from the relevant parties and stakeholders within your organization. Sometimes you may be required to demonstrate the validity of the data analysis by comparing it with the results of analysis by external experts or third-party organizations. In addition, the relevant parties within your organization may have doubts about the analysis results. In preparation for such cases, it is important to ensure transparency in the analysis as much as possible and clearly explain to the relevant parties the process from data collection to the selection of analysis methods and execution of the analysis.

When working on in-house marketing analytics, it is important to pay careful attention to ensuring trust within the organization. Ensuring transparency in the data analysis process will lead to more reliable analysis results. Providing reliable data analysis results will increase trust in decision-making and strategies within the organization, making it easier to take action.

・The need for continuous R&D

The field of marketing analytics is constantly evolving, with new technologies and methods constantly emerging. In-house data analytics teams need to constantly update their knowledge and skills. However, continuous R&D activities require resources and time, which can put a strain on the team's daily analysis and reporting tasks.

R&D activities should be supported through the implementation of continuous learning and training programs and through collaboration with external experts.

Lack of benchmarks

One of the disadvantages of performing marketing analysis in-house is that benchmarking cannot be utilized as compared to consulting with external experts.

If you hire an external marketing consulting firm or data analysis specialist, they can use data from many companies and industries for benchmarking, allowing them to provide you with appropriate advice on analysis methods and marketing strategies while comparing your data with that of similar companies and industries.

My Feelings, Then and Now

The above is an overview of the advantages and disadvantages of in-house marketing analytics. While in-house marketing analytics brings many benefits to companies, it also comes with certain disadvantages.

While it offers custom analytics tailored to unique business needs, near real-time data analysis, cost savings and operational efficiencies, it also addresses talent acquisition, eliminating bias and ensuring trust within the organization, and the need for ongoing R&D.

If these disadvantages are difficult to overcome, it may be more effective to utilize an external company that specializes in marketing analysis. By utilizing external experts, you can not only make up for lack of specialized knowledge and experience, but also complement points that are difficult to achieve with in-house alone, such as utilizing benchmark data from similar companies and industries. It is important to consider in-house development, external experts, or a combination of both, according to the needs, resources, and strategy of your organization, and choose the optimal approach.

Our company, XICA, has over 10 years of experience in the field of data science in marketing, providing consulting and services using in-house developed technology, and has a track record of supporting over 250 companies, primarily large corporations. Our data scientists and marketing consultants, who have extensive and deep expertise in a wide range of industries, support our clients in utilizing data with the most appropriate analytical methods according to their needs and objectives.

If you are considering using an external marketing analysis specialist company, we recommend XICAMarketing SolutionsPlease see here.Please contact us via inquiry.

Author information

XICA Co., Ltd. Marketing Team