We weigh up the pros and cons of going in-house or outsourcing to an agency.
The success of a company's marketing efforts is dependent partly on the experience and effectiveness of its marketing team. No wonder companies invest millions yearly in marketing to upgrade marketing tools, hire experts, and boost revenue.
However, recent changes in the marketing space have created a debate around which marketing team structure is best. A survey of 1000 startups reveals that about 57% have a dedicated in-house marketing team, while 4.8% rely on digital marketing agencies to manage their digital campaigns.
As a founder, CMO, or marketing manager, you must consider the option that brings the most value and best return on investment and aligns with your marketing goals.
We'll explain the difference between in-house and agencies, the pros and cons, and our opinion on which is best to grow your business.
Whether you decide to hire an In-house or digital marketing agency, they both have their pros and cons. Understanding these and how they stack against each other will help you make a better decision. Based on our research and experience, we have grouped the pros and cons of hiring in-house vs. digital marketing agencies under seven distinct categories.
Building an in-house team allows you to work with people who understand the ins and outs of your business. For in-house marketers, your business is more than just another brief. An in-house marketing team can effectively convey your brand's uniqueness. Also, there's a certain level of brand loyalty that you enjoy.
However, outsourcing your digital marketing campaigns to an agency doesn't provide these perks. Although a project brief might suffice, it cannot match the in-depth knowledge of an in-house marketing team.
Most digital marketing campaigns are time sensitive and require on-the-move, real-time reports and constant communication. An in-house marketing team is resident onsite and accessible to you at all times. Therefore, it's easier to communicate and relate time-sensitive information.
If you are working with a number of agencies to coordinate everything (e.g. one doing digital, the other doing creative etc.), each agency will schedule meetings over communication platforms like Zoom, Slack, and others. In a situation where there's time-sensitive information, it takes time to assemble each member as they could be working on multiple projects simultaneously.
CMOs prefer to control their digital marketing campaigns' strategy and implementation process. An in-house marketing team will favour a business owner who wants to monitor the process closely from start to finish.
In contrast, it might be challenging to control the strategy implementation process of a digital marketing agency. Usually, an agency will propose the best digital marketing strategy and implement it at their pace to achieve suitable results.
A critical challenge business owners have working with an in-house marketing team is the cost of purchasing the necessary digital software and tools. To ensure that your digital campaigns are effective, you must invest in tools and other digital marketing software separately from individual team-based costs. For example, Kepla is a cost-effective tool that empowers your in-house team with confidence and expertise to run, optimise and deliver outstanding results from your digital campaigns.
However, when you hire a digital marketing agency, you wouldn't have to purchase software to run effective campaigns for your business. Typically, the agency fee should cover the cost of software, or some of it, tools, and other miscellaneous expenses. For example, a $5,000 / month retainer for a digital marketing agency to manage your digital campaigns should cover all tools they might need.
Working with an agency for a medium-sized company is a cost-effective way to grow while using expert marketers to implement your marketing strategy simultaneously.
When you are just starting, it's possible to handle digital marketing yourself, but as the business grows, you will have to hire a digital marketing specialist to manage these activities. That's where the challenge begins. Hiring a specialist team that can provide full-service marketing is difficult, especially in a competitive industry with limited top talent. Consequently, you might need to outsource some aspects of your marketing to freelancers or an agency to fill in the missing expertise.
However, when you work with an agency, you also get their full range of skills and experience. For example, you might require a specific strategy for your business and notice nobody on your in-house team can create and implement such. Contrariwise, an agency, especially a full-service agency, has all the necessary skills and can take up whatever project request you have.
A common experience in business is the unexpected rush that comes with big launches or business growth. An in-house team cannot scale to accommodate the growth of your company without incurring the extra cost of hiring new staff.
In contrast, a digital marketing agency can adjust fast to emergency demands and support your business growth. Agencies have a complete team of marketers and affiliates who can respond swiftly to large-scale digital marketing requests without losing touch with their creativity.
Although most business owners say in-house teams are cost-effective to build and manage, it's far from the truth. Factors like silent quitting, staff training, HMO, 401k, and other individual benefits increase the cost of managing a team compared to working with an agency. Generally, it costs about $150,000 in annual salary to manage a midsized in-house team.
However, the cost of hiring a digital marketing agency is dependent on the services you need and the campaign duration. In contrast, in-house marketing teams get paid monthly regardless of their productivity. For example, hiring an agency costs between $4,000 to $25,000 per month, which means you’d save up to 50% on building a team. There's also the cost of recruiting team members, hiring a recruitment agency, and onboarding.
Whether to manage your company's digital marketing campaigns in-house or hire a digital marketing agency will depend on your business needs. An in-house marketing team might be the best option because it allows you to control the strategy implementation process and supports building a formidable company culture. In contrast, an agency offers diverse skill sets, capabilities, and broad industry experience. However, in-house and agency marketing have their pros and cons.
In our opinion, from studying different businesses and offering a digital campaign management tool to businesses, this is our verdict:
If you manage a start-up with a limited budget and the need to produce marketing results fast and efficiently, outsourcing your digital marketing campaigns to an agency is the right way to go. An agency will provide Industry experience that will boost your growth compared to spending millions on assembling a team that can fall apart in weeks if a member quits.
On the other hand, if you have an established business and want to build a formidable company culture for your business, an in-house marketing team is your best bet. Hiring an in-house digital marketing team to manage your digital campaigns will support building a company culture that transcends just marketing.
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