Propaganda is as much about convincing "the people" as it is convincing the "internal apparatus". Of course, for something like WWI, you have to have propaganda because the effort required is too large -- you can't do WWI or WWII with the apparatus alone.
But it's very important, even for the people "on the inside", to believe that they are fighting for the right cause, to be able to rationalize their actions. If you need something morally fraught to be done (like fight a war), the people doing it, regardless of who they work for on paper, are much more effective if they believe in their hearts that it's the right thing to do. Propaganda isn't really about convincing people do to things, it's about giving them the emotional toolkit to justify doing things with purpose and pride.