In House Marketing vs Outsourcing: Which Is Better For Your Business?

Table of Content:

• What is in-house marketing?
• What is outsourcing marketing?
• Understanding your options?
• Consideration One: Stage of Company
• Consideration One (Continued): Stage of Company
• Consideration Two: Getting the right help at the right time
• The Cost of Hiring: Choosing in-house marketing team vs outsourcing marketing and sales
• Conclusion

Deciding Between In House Marketing vs Outsourcing? Read On…

Would you like to outsource your marketing to a firm? Or prefer to hire your own team of marketers? One of the biggest decisions for companies is whether to outsource their online marketing to a firm or hire an in-house team. And many businesses get it all wrong. In my experience, I’ve observed this being one of the biggest mistakes businesses make.

Even though both options are viable, I see too many businesses employ ineffective strategies and waste a lot of money on both in-house and hiring an agency. So when it comes down to hiring or outsourcing your marketing efforts, what is better for your business? Let’s take a look.

What Is In-House Marketing?

It sounds like an oxymoron, but it isn’t and it’s why the buzzword is gathering steam. The idea of a chief marketing officer, a department for social media, or even a team of employees to do digital marketing once would have been scoffed at as unnecessary overhead; now, many small-to-medium businesses are realizing that in-house marketing can not only save them money but lead to a much higher ROI.

In-house marketing is a marketing department located within a company. This department provides all the internal marketing services for all the business units within the same company. It gives businesses the advantage of having all facets of marketing in house e.g. market research, web development, writing and data analysis.

What Is Outsourcing Marketing? Here’s What You Need To Know.

The term outsourcing may evoke thoughts of massive off-shoring and American jobs fleeing to foreign countries. But what about when you outsource something other than manufacturing — like marketing? Although some people have negative connotations toward the concept, it is actually a viable option for today’s small businesses.

Outsourcing marketing may be an unfamiliar concept for many small businesses. This is understandable because there’s often a misconception that outsourcing marketing is only for large businesses with lots of money to spend. Here’s a simple truth:

Many businesses are outsourcing marketing to other companies and individuals. Outsourcing can simply be defined as when a business gives another company or individual responsibility for parts of their business, or its entire operation. Many businesses have chosen to outsource certain aspects of their business in order to save money, increase productivity, or just to not add another job listing in their company.

Understanding Your Options

The natural inclination is to hire in-house, but it is important to recognize the strengths of other solutions and compare them to your own needs. Companies can choose to completely in-source their marketing or choose to completely outsource. But an interesting approach that many companies don’t always take the time to understand is taking a hybrid approach to in-house marketing and outsourcing marketing.

In some situations, the hybrid model works very well for getting high quality work done. Here’s a quick overview:

Scenario #1

In one scenario, a company hires a full-time marketer (Chief Marketing Officer –  CMO) to work directly for the company. The company then decides to outsource program management and execution support to organizations that can provide it with the service.

Scenario #2

In this situation, your company gets the best of both worlds. A professional has been hired to manage the day-to-day activities of a marketing team, and you get a highly qualified contractor for the tasks you have that are more strategic & specialized.

The key principle for choosing your strategy is to pick the right resources for your company, based on your current position and where you want to be, given your marketing requirements. 

The rest of this guide will give you the information you’ll need to evaluate the correct structure for your company.

Consideration One: Stage of Company

Marketing approaches are seldom static, and a company’s marketing needs will evolve as it goes through different stages of development. In particular, startups and small businesses are constantly trying to understand how to market successfully, which is why they require a unique marketing mix. The types of marketing methods and tools a company needs at the beginning stages are going to be a lot different from what they need when they’re ready for full-scale growth.

Take advantage of time management and delegation by looking at startups and small businesses with leaders who have already successfully managed these dynamics. Generally, leaders with experience in managing startups know how to outsource the expertise they need and when.

The biggest mistake that most companies make when they first start a marketing strategy is hiring an excessive amount of staff right away. This approach is very costly and counterproductive because it results in your product or service being poorly marketed. These extra employees need time to adjust to their roles and responsibilities, so they don’t get the job done effectively for some time.

In today’s capital markets, very few parties have all of the skills required to support your growth. You need to leave room in your budget for investments that build your capabilities and alliances with industry partners.

As a startup or small business, it might be more effective to invest in someone else to do the marketing. Once your business becomes more mature, it might behoove you to take on the task yourself.

Consideration One (Continued): Stage of Company

It’s not uncommon for large companies to have a difficult time finding someone in-house with both the creativity and knowledge to develop an integrated marketing strategy. Many established companies would be surprised to find out that they don’t possess all of the in-house skills and marketing departments of their competitors. Efficient marketing requires a unique blend of digital and traditional skill sets that evolve over time with the ever changing marketing landscape.

Whether you run a small or midsize business and are looking for someone to help raise the bar, or are in need of a role where you can more heavily dedicate your time to a single campaign strategy, hiring a mid-level marketing marketer may be an option worth considering. A contingent labor model allows you to outsource as much or as little of your workload as you wish, meaning that you can have more hands on deck in areas where your team might be lacking while maintaining full-time positions for staff members whose services aren’t available via our marketplace. In addition, the problems associated with payroll taxes and employment costs can be avoided when you’ve outsourced to one or more contractors.

Consideration Two: Getting The Right Help At The Right Time

A crucial but often overlooked application for many companies is how marketing should be integrated into their business model. How is marketing expected to help the company achieve its goals?

Do you view marketing as an important part of your business?

Marketing can lead to significant competitive advantage. Companies that truly understand that will hire best-in-breed marketing talent in-house and outsource where it makes sense. Even companies that do not view marketing as one of their competitive advantages are striving for and innovating in this area. Effectively communicating a company’s value proposition, goals, and brand is what marketing is about; it’s something all companies need to be thinking seriously about.

What sorts of capabilities does this job and company need?

There are two major kinds of marketing activities. The first is straightforward. It’s fairly easy to set up a continuous flow of email campaigns or online ads. Then there are the more creative kinds of activities, which require expertise that you have to develop over time. These include search engine optimization and content development. Where do you fit in?

Is the company currently looking at new trends and repositioning itself accordingly?

When we speak of a business needing a new marketing strategy we tend to think of the relatively rare circumstances where a business is redesigning its overall identity. The marketing strategy is part of that but it also needs to be considered in the context of all aspects of the business and how they are likely to change. The challenge for any company undergoing this sort of change, or one that wants to take advantage of a new emerging opportunity, is how it can maintain the effectiveness of its marketing initiatives as its needs and focus change.

Even when a business appears to be doing well, it is crucial to look at internal strategic options – looking at the bigger picture and identifying new opportunities. It is not uncommon for businesses to become complacent – after all, they are making money and the status quo usually appears safe. In these cases however, the business may risk becoming outdated and unable to rapidly innovate. Expand into different market segments, alter its value messaging, offer new products or services – today’s marketers must be flexible and nimble enough to deal with change.

Is there a good balance between your sales and investments in marketing?

Marketing is an important element of your business. To determine whether you need marketing support, take a look at how much time you spend on marketing and how the revenue from your marketing efforts compares with that amount of time. Spending lots of time but making low revenue from your marketing efforts might be a good indication that you need more help with your marketing efforts.

If you’re having trouble with your marketing efforts and don’t know how to solve your problem, reach out to us, because we can help improve your marketing results and save you time.

Other factors also need to be taken into account, such as how rapidly the company is looking to scale, the business environment, and how marketing needs to interact with others in the organization. You also need to consider important factors like whether the business is looking to expand, whether competition exists, and what the current business environment is. These are factors that will help you understand how marketing should interact with other areas in the organization.

The Cost Of Hiring: Choosing In-House Marketing Team vs Outsourcing Marketing and Sales

There’s an old saying that goes, “you get what you pay for.” It seems counter-intuitive to think that one would pay for something yet not get what they wanted in return. But that’s exactly the reality many business owners face when they decide to hire in-house versus outsourcing their marketing and sales efforts. Cost is the number one influencing factor for many businesses when it comes to segmenting and choosing which hires to make or which outsourced marketing services to purchase.

In-House Marketing Individual/Team Cost Analysis

Outsourcing your marketing needs is often a less expensive alternative to hiring an in-house team. While there is no established price for a marketing company, most clients agree that the industry standard is somewhere between $3,000 and $5,000.  If your team is in-house, the average cost of getting just the critical members for a project is $346,000 – $853,858. Here’s an analysis of average cost per position:

Marketing Manager: $66,090 – $175,060/year 

Digital Marketing Strategist: 50,000-79, 000/year 

Social Media Manager: $41,577 – $108,800/year a year 

Entry-Level Content Writer: $26,203 – $101,816/year 

Marketing Data Analyst: $40,201 – $84,175/year 

Marketing Technology Manager: $89,000 – 120, 000/year 

Creative Marketing Manager: $33,026 – $83,191/year

I’d like to point out that the cost analysis above doesn’t include costs such as benefits, on-going training and development, and recruitment of the employees.

Because marketing agencies work with many different clients, they have access to a wide pool of marketing tools and resources. If you consider all of the costs of an in-house team (salary, vacation and sick time, fringe benefits, training, etc), it would most likely be much more expensive than an outsourced agency. You’ll find that marketing agencies have solid processes for setting and reaching marketing goals, and are more than capable of providing the guidance you need to ensure success. From an ROI perspective, it’s advantageous to outsource your marketing and sales needs.

In Conclusion

When deciding whether to hire in-house or to outsource your business, it’s important to take into account the various factors involved. No one approach works for everyone. Many firms with a high rate of growth need to bring on more resources quickly, so they outsource their marketing needs until they can hire in-house resources.

Other companies with marketing staff on their payroll may decide to bring full-service agencies to support them by giving them access to broad resources such as account management, creative services, and media buying. Many businesses have found that working with a digital agency that provides many core services can be more effective than hiring someone for in-house marketing.

Each approach has its advantages and disadvantages. Companies need to decide which approach will work best for them based on their goals, resources, and preferences. We have companies that tried to fill these roles in-house, but they were unable to find the right person. It’s hard to find all the skills needed for a business-critical position in one person.

Some of our clients knew they were looking for a full-service, fully outsourced partner from the beginning. Some of our clients only need us for specialized components of their marketing. They don’t have the in-house expertise to deliver everything themselves, so they know they can rely on us to create high quality work, while simultaneously hiring experts for the rest.

Are you trying to figure out which direction will be best for your company? We’d be happy to talk with you about how we can help you. Click here to contact us for a free consultation. Our team has worked with a number of clients on marketing strategy, helping them to determine the right structure, budgets, and other requirements needed to fulfill the marketing function.

We are an agency that works as a seamless extension of our client’s marketing department, but without the cost or risk of hiring employees. We offer the benefits of traditional agencies, while maintaining a lean and nimble team.