Final answer:
Companies use in-house agencies primarily to reduce advertising and promotions costs, allowing them to streamline brand management and create integrated advertising campaigns that uphold a cohesive brand identity.
Step-by-step explanation:
A major reason why some companies choose to use an in-house agency is to reduce advertising and promotions costs. By handling advertising internally, companies aim to cut down on the expenses associated with hiring external ad agencies, which can be significant especially when the company requires a large volume of advertising for a firmly established brand name. Additionally, having an in-house agency can lead to better coordination and integration of the brand's messaging across various platforms, creating a cohesive brand identity. Companies like Coca-Cola and Pepsi Cola have large advertising budgets which can discourage new competitors and reinforce their established brand names. Furthermore, internal teams can ensure that all advertising efforts are aligned with the company's strategic goals, potentially increasing efficiency in brand management and advertising efforts.