Dive Brief:

• Shake Shack, the fast-casual burger chain with about 160 locations, expanded its marketing team by in-housing staff from its agency of record, Agency Within, per a company announcement.
• The in-housing project will focus on Shake Shack's marketing partnerships such as one with Grubhub, which began offering delivery from the chain in August. Agency Within's staff will handle digital experience and marketing strategy for Shake Shack while attending marketing meetings and managing campaigns to hit key performance indicators (KPIs).
• Agency Within will report directly to Shake Shack CMO Jay Livingston. The agency's other clients include brands such as Nike, Spanx, Acorns, Purple and Hugo Boss.

Dive Insight:

Shake Shack's move comes as more brands in-house their advertising and marketing services that ad agencies traditionally have handled. The number of marketers working with some type of in-house agency jumped from 58% in 2013 to 78% in 2018, according to the Association of National Advertisers, but 63% have had trouble keeping the talent energized, per a separate ANA report. The in-housing trend has gained momentum in recent years, partly because traditional agencies have struggled with the latest digital marketing technologies and providing better transparency of their fees.

Bringing the Agency Within team in-house is another sign of how Shake Shack's strategy is evolving under CMO Livingston, who joined the company in January. He previously was CMO of Bark, the subscription-box marketer of dog care products, and worked in marketing at Bank of America. He had planned to hire to 35 to 40 additional marketers and keep much of Shake Shack's marketing operations internal, Ad Age reported in August. It's unclear how many Agency Within workers will handle those roles.

The expansion of its marketing team comes as the fast-casual chain experiences rapid growth, including a 32% jump in revenue to $157.8 million in Q3 from a year earlier. Its locations are mostly concentrated in coastal cities like New York and Los Angeles, but Shake Shack plans to expand its footprint by about 25% to more than 200 locations by the end of next year, per its quarterly report. It currently is the 90th-biggest restaurant chain in the U.S., per Technomic data cited by Ad Age, and faces formidable competition from more established rivals. The company's expansion plans require a broader range marketing expertise that Agency Within can provide.

Despite Shake Shack's growth, the burger chain has seen some recent hiccups with its rollout of Grubhub delivery while dropping other delivery services such as DoorDash, Postmates and Caviar. Rather than download another food delivery app, many Shake Shack customers stuck with their existing services and ordered food from other restaurants instead.