To reach more customers, increase revenue, and grow as a business, every company needs to approach marketing the right way. For most growing companies, outsourcing marketing to an agency or consultancy is the most viable option.
At a point, however, especially after having grown to a certain level, most organizations decide to take their marketing in-house. While some have good reasons for the decision, many others feel they just have to go in-house when they grow to a certain point, without considering the advantages along with the shortcomings of the move.
Is your brand at that point where a decision needs to be made on hiring an in-house marketing team or outsourcing to a marketing agency or consultancy? You shouldn't make a decision based on what you’re “supposed” to do at a certain stage, you should carefully measure what’s right for your business.
This is an important business decision that will affect the future of your company and needs to be taken seriously. It is important, therefore, to consider what hiring an in-house marketing team entails and compare it with what you will get by outsourcing to a marketing agency, especially the cost in both money and manpower.
What Does Hiring an In-House Marketing Team Entail?
Deciding to hire an in-house marketing team means building a team of marketers that will work full-time in your organization, handling marketing and marketing-related tasks. Ideally, this means you will have to hire trained marketers who will fill in different positions according to their qualifications and experiences. In most instances, finding trained and experienced marketers can be challenging as some 72.8% of companies have trouble finding skilled candidates, so you will have to consider the training effort needed to make the team effective.
Part of having a team working for you full-time means, they will be fully committed to the marketing needs of your organization solely, but may not necessarily possess the expertise and experience you need to start. Members of the team will have to understand your company’s vision and work towards achieving it and communicating it to the outside world.
An executive will be responsible for supervising and monitoring this team, just like other departments in the organization. A big task for team members who already take on a large role and are often strapped for time.
As full-time employees of your organization, the marketing team will need to be adequately compensated. To keep your team, you must pay every member according to the market rate for their position on the team, which for a full-service marketing department, means upwards of $84,000 a month. From a marketing manager to a social media manager, you often pay each member of the team a full-time salary, according to the terms of your employment agreement. In addition to employee benefits, you may be required to pay yearly bonuses, time off, health insurance, and other perks or necessities.
What Are The Major Benefits Of Hiring An In-House Team?
Hiring an in-house marketing team comes with some benefits. The most important ones include:
- Full control of who handles marketing for your organization and how they go about it.
- A team that is familiar with your business cultures and is monitored closely to comply.
- Ease of sharing information with marketers to enhance adaptability.
- Having marketing and sales under the same roof.
Is There a Downside to Hiring An In-House Marketing Team?
While there are serious benefits an organization stands to gain by building an in-house marketing team, there are pitfalls that come with it too. The major ones to consider include:
- The processes of advertising, interviewing and hiring the right candidates take time and resources.
- The extra office space or remote accommodations, the overhead of salaries, benefits, equipment, and intangibles.
- Managing the in-house marketing team can be unnecessarily burdensome.
- It is often difficult to accelerate marketing programs rapidly with an in-house team as expertise, skills, and resources are mostly limited, pending the employment of new personnel, training of existing employees, or access to tools.
- The sort of specializations needed to execute integrated marketing plans is difficult to achieve with an in-house marketing team.
- If a member of the team decides to quit, the impact can be very heavy on the company as it can cost up to 33% of that employee’s salary just to find a replacement. Finding a suitable replacement can up to an average of 27 working days, making the organization miss out on opportunities.
What Outsourcing Marketing to an Agency or Consultancy Looks Like
Outsourcing marketing to an agency or consultancy is an alternative approach to marketing used by most organizations. This practice has been in existence for decades but has been made more popular by the digital marketing era. It is the pattern most small and medium-sized businesses embrace. Many big brands use marketing agencies as well to supplement their creative and other marketing operations. It generally entails hiring an agency to handle the marketing needs of an organization for fees that may be paid monthly, annually, or by other arrangements.
There are several marketing agencies out there willing to handle the marketing needs of businesses and brands. Most of these agencies are run by professionally-trained and experienced marketers/managers. They also have expert marketers who specialize in different fields and work as a team to meet the marketing needs of clients.
When you outsource marketing to an agency, you enter into an agreement with them to handle your marketing needs. The terms of the agreement will depend on your needs and what the agency offers.
For example: At Hawke Media, we offer a number of services ranging from managing a single channel to building and executing an entire integrated marketing strategy.
In most instances, they can cover all aspects of marketing for your organization, meaning you won’t need to employ even a single full-time individual to oversee marketing. Many agencies offer packages that clients can choose from, according to their needs.
What are the Major Benefits of Outsourcing to an Agency?
Outsourcing marketing to an agency or consultancy offers several benefits. The most important ones to take note of include:
- Outsourcing to an agency or consultancy is easy and pretty straightforward. Businesses may have to search and do their due diligence to vet the agency they intend to hire but the processes are easy and straightforward.
- A good marketing agency or consultancy will employ a team of experts who have worked on numerous and varying projects and can easily offer tactics that can yield better results for an organization.
- Outsourcing to a marketing agency eliminates the need to create office-space for marketers in your organization.
- Marketing agencies normally have everything they need to jump in and make an immediate impact on an organization.
- Agencies have access to the latest marketing tools and software and will readily deploy them to bring desired results to the marketing objectives of clients/businesses.
- Though they have top-level professionals, marketing agencies are often privy to the best talent around if there is ever a situation where the scope of work expands outside of their specialties.
- While working with a marketing agency, businesses pay according to the marketing package they need. They don’t pay individuals who may not be contributing meaningfully to the campaign.
- Marketing agencies and consultancies often have partnerships with different platform providers and adjacent service providers that can come in handy for operational needs within and outside the scope of marketing.
- The longer you work with an agency, the more they’ll begin to understand your brand, culture, and message.
- Agencies and consultancies are a hotbed for an influx of novel ideation and industry-leading campaigns.
Is There a Downside to Outsourcing Marketing to an Agency?
Though there are several benefits associated with outsourcing marketing to an agency, at times it can leave a little to be desired. Some of the major drawbacks of outsourcing you should know about include:
- A marketing agency will be unfamiliar with your company’s culture and clients will have to relinquish granular control of marketing activities. It requires a bit of trust, which is why choosing the right agency or consultancy matters.
- There may be times your company doesn’t feel like a priority. This is never acceptable.
Decision Time: What's Best For Your Brand?
If you followed carefully you would have noted that both options have an upside and downside, as with any scrutinizing comparison. If you take marketing as seriously as you should, the decision should not be made in haste. Some business executives erroneously assume that they need to build an in-house marketing team once they reach a certain stage of growth.
Before deciding to either hire an in-house marketing team or outsource marketing to an agency, you need to look at your organization carefully and understand your marketing objectives. You also need to consider the major benefits and drawbacks of the options available to you. While short-term benefits are important, you also need to seriously consider the long-term impact.
Comparing the Two Options on Key Factors
Are you ready to decide on how to handle your business marketing needs? These are the key factors you need to consider carefully. To help you choose right, we’ll go into a more detailed comparison of hiring an in-house team and outsourcing marketing based on the factors we consider most important.
Tools and Techniques
Marketing keeps evolving with new techniques and tools emerging. It can be very difficult to keep up with trends, especially for an in-house marketing team. Marketing agencies, on the other hand, normally have their fingers on the pulse of the market. They have access to the most complete versions of the latest tools and software. They also develop and adapt new techniques for their varying clientele.
Outsourcing to them means your marketing operations will be run with the latest tools and techniques in the hands of experts who know how to use them masterfully, and this normally brings better results. This often has no impact on the scope or price of your contract.
If, on the other hand, you are using an in-house marketing team, you may have to pay for the latest software; some can be prohibitively expensive if it’s targeted towards enterprise organizations with abundant cash flow that are less risk-averse.
Agencies make enterprise-level teams and tools available to companies that may not have the capital to support them.
When it comes to executing integrated marketing plans, a number of specialists could be needed. This is another area where marketing agencies offer an advantage over in-house marketing teams. It’s unlikely that an in-house team will have all the professionals needed to execute some marketing programs effectively without hiring freelancers or working with an agency on some aspect of the campaign.
Organizations will often hire more generalists who can accommodate for the lack of specialization present at an agency or consultancy. With the diverse skillset at the disposal of most marketing agencies, implementing the best-integrated marketing plans is a lot easier to accomplish since each team member has a limited or singular focus while a generalist may have to handle tasks that cover a broad spectrum of skills and experience.
For example: If Company X wants to create an ad campaign using video collateral to help tell a visual story and test it to increase conversions across multiple paid and organic platforms, they’ll need someone skilled at creative and video production, someone who’s experienced at paid advertising on those platforms, someone who’s skilled at community management and social media, and someone who’s skilled at content strategy. It’s costly and somewhat unlikely that one or two people would be able to execute this strategy to the same degree as an agency with teams that can handle each of these responsibilities, have done it before for multiple clients, and know the most successful strategies to get seen and convert.
As an executive at any stage company, the cost is one of the most important factors to consider in any decision. While some agency services seem pricey as a standalone cost, you have to consider what you’re getting.
What positions would you staff your in-house team with? A digital marketing specialist, a CMO or VP, a social media manager, a marketing automation specialist? According to US News & World Reports, the median salary for a Marketing Manager is $134,290, that’s $11,190.83 a month for a single mid-level employee.
It’s difficult to anticipate what you’ll need as your company grows and you want to scale your lead generation and conversion efforts. You may start off focusing on paid media, but soon realize that organic channels are more sustainable. Revelations like these will spark a need to add additional components to your team or rely on your existing team members to pick up these skills, both of which can be expensive and time-consuming. Depending on your needs, it’s usually more cost-effective to outsource your marketing rather than hiring an in-house team.
There are a number of intangible costs that come along with hiring in-house. Like all of the costs involved in recruiting a marketing team–you have to advertise, interview applicants, hiring, onboarding, training, and etc.
Return on Investment
At the end of the day, you’re looking for a team of people that can get the job done efficiently and cost-effectively. It’s a business decision.
You should consider the short and long-term ROI of each option. You carry a higher risk of bringing a team in-house because it’s often unpredictable, but you potentially get the benefit of a team that knows and has an intimate connection to your brand. On the other side you get a team of experts that are skilled and well-versed in different channels, but an environment that may seem difficult to navigate or impersonal.
If your agency does its job, it will help your business grow and scale and you’ll feel that they’re aligned with your needs, often leading to an expansion of services. If your in-house team accomplishes the same thing, you’ll need to continue to hire as responsibilities grow and operations become more complex.
Whichever you choose, you should regularly audit the cost and performance of each channel based on a set of goals and KPIs that you clearly define early in the onboarding process. With an in-house marketing team, you have to consider the amount you spent on building the team, the amount you spend on marketing tools, as well as the overhead salaries and other benefits provided to team members against their performance.
Assessing the ROI of an agency should follow a similar structure, what you paid against the deliverables you agreed upon in the scope of work. When it comes to agencies they should always provide metrics to justify their work.
The goal in either instance is to have a team that meets or exceeds expectations and works within your budget to create positive cash flow for the company.
Platform and Service Partnerships
Agencies often have relationships with marketing/advertising platforms and service providers that give clients access to resources and information that may have otherwise been difficult to come by.
Most ad platforms offer premium services, which are often expensive or specifically offered to agencies as a means of acknowledging an agency’s commitment to the mastery of their tool. The same platforms often offer individual certifications for in-house marketers that want to remain competitive.
- Building an in-house marketing team involves recruiting, training and doing everything to maintain any number of people expected to fulfill different marketing functions.
- The biggest benefit of having an in-house marketing team is the fact that they are at your fingertips and familiar with the culture, values, and workflow of the organization.
- Outsourcing marketing to an agency involves paying the agency to handle aspects of your company’s marketing needs. You may not need to put anyone in charge of marketing once you engage the right agency.
- Outsourcing to a marketing agency or consultancy offers several benefits such as cost-effectiveness, having highly skilled marketers working for you, and enjoying premium services that offer your organization competitive advantages.
Marketing is an aspect of your business you should never take for granted. While having an in-house marketing team has some advantages, most businesses will benefit more from outsourcing marketing to agencies. It is important that you consider all the factors discussed here before making your decision.
This article originally appeared in the HawkeMedia blog and has been published here with permission.