From cost savings to leveraging expertise, outsourcing your digital marketing needs to our Agency Partners is a smart and cost-effective decision, especially if your business has limited resources.
Is your business struggling to keep up with the constantly changing marketing landscape? Hiring external professionals or agencies to handle certain tasks or functions that would normally be done in-house will provide significant benefits and advantages.
In recent years, outsourcing has become a prevalent business strategy, especially for businesses looking to scale up, and marketing is no exception.
In fact, a recent study showed that 83% of small businesses will maintain or increase their spending on outsourced business services in 2023.
Digital marketing is one of the services that businesses commonly outsource.
In this article, we will explore the many advantages of outsourcing your digital marketing efforts to an agency and why this can turn out to be more cost-effective for your business in the long run.
We’ll cover the following areas:
- Why Outsource Your Digital Marketing Needs?
- The Benefits of Outsourcing Your Digital Marketing Needs
- The Hidden Costs of In-House Digital Marketing
- The Hidden Costs of Outsourcing Digital Marketing
- Outsource Your Digital Marketing Needs or Build An In-House Team?
- Tips for Choosing the Right Digital Marketing Agency
- Outsourcing To A Digital Marketing Agency – Next Steps
Why Outsource Your Digital Marketing Needs
As part of your own digital marketing strategy, your business will have to decide whether to handle its digital marketing needs in-house, outsource to a digital marketing agency, or a combination of both.
To understand some of the key reasons why you may want to consider outsourcing your marketing, let’s start by looking at content creation, which, according to research on digital marketing trends, is the area that many businesses are increasingly focusing more of their efforts on.
However, businesses also face significant challenges trying to meet their digital marketing strategic goals. These challenges include having limited budget and resources, lacking systems and processes to generate content and collect data, and more.
Businesses need to engage in marketing activities to remain competitive, but many struggle to afford and manage the marketing processes required to create and deliver effective results.
Content creation, however, is only one aspect of your digital marketing needs. What about advertising, analytics and reporting, branding, SEO, email marketing, video marketing, social media, etc.? These are also necessary for an effective digital marketing strategy.
Since we are focusing on whether outsourcing your digital marketing needs is more cost-effective than building an in-house marketing team, let’s start with a brief overview of the benefits of outsourcing.
The Benefits of Outsourcing Your Digital Marketing Needs
Outsourcing your marketing needs to a digital marketing agency offers a number of benefits, including:
Cost Savings
One of the key advantages of outsourcing your marketing needs is cost savings. Hiring and maintaining an in-house marketing team is expensive, as it involves costs such as salaries, benefits, office space, equipment, and training.
Outsourcing will help to avoid these costs as you can simply pay for the services you need on a project basis or through a retainer, depending on your requirements. This will result in significant cost savings and increased ROI, especially for SMEs with limited budgets.
Flexibility and Scalability
Outsourcing provides you with the flexibility to scale your marketing efforts up or down based as needed, without the need for permanent hires or layoffs.
During busy seasons, you can increase your marketing efforts, and during slow seasons, you can scale back, without having to worry about hiring or firing employees.
This flexibility allows your business to adapt its marketing strategies to changing market conditions without the overhead costs associated with an in-house team.
Access to Specialized Expertise and Resources
Marketing is a complex field that requires expertise in various areas such as search engine optimization (SEO), pay-per-click advertising (PPC), social media management, content creation, content marketing, email marketing, and more.
Outsourcing your marketing needs to an agency will give your business access to a team of professionals with specialized skills, expertise, cutting-edge tools, technologies, and resources that may not be available or feasible to invest in-house.
For example, external marketing agencies can provide your business with access to cutting-edge technologies that will help to analyze data, track performance, and optimize your marketing campaigns, resulting in more effective and targeted marketing strategies that will drive better results.
Professionalism and Experience
Marketing agencies are specialized entities with a wealth of experience in handling marketing campaigns for different clients across various industries. They have a pulse on the latest marketing trends, strategies, and best practices, and can leverage their expertise to create effective marketing plans tailored to your business goals.
Additionally, agencies often have a diverse team with specialists in different areas, allowing them to bring a well-rounded approach to your marketing efforts.
Time and Resource Savings
Outsourcing your marketing needs frees up valuable time and internal resources for your business to focus on its core competencies.
Instead of spending time on marketing tasks, your in-house team can concentrate on their primary roles, leading to increased productivity and efficiency.
The Hidden Costs of In-House Digital Marketing
In-house marketing may seem like a viable option, but it also comes with often overlooked hidden costs that can add up over time, making outsourcing to a digital marketing agency more cost-effective in the long run.
Some of the hidden costs of in-house marketing include:
Hidden Cost #1: Training and Development
Keeping up with the rapidly changing marketing landscape requires ongoing training and development.
If you plan to build an in-house marketing team, then expect to invest in continuous education, certifications, workshops, and seminars to ensure that your team stays up-to-date with the latest marketing trends and best practices.
These training costs will quickly add up.
Hidden Cost #2: Employee Turnover
Employee turnover is a common challenge in the marketing industry with professionals often changing jobs or seeking better opportunities elsewhere.
This can result in significant costs associated with hiring, onboarding, and training new employees. Additionally, turnover and mis-hires can disrupt marketing campaigns and strategies, leading to delays and added costs.
Hidden Cost #3: Equipment and Software Costs
An in-house marketing team requires investing in technology and infrastructure like specialized equipment and software tools to support your marketing efforts and execute tasks effectively.
Investing in website development and maintenance, hardware, software licenses, subscriptions, marketing automation tools, CRM systems, analytics platforms, and other marketing technologies is expensive. Moreover, these tools require regular updates and maintenance, which will further increase costs over time.
Hidden Cost #4: Management and Overhead Costs
Managing an in-house marketing team requires additional overhead costs, such as salaries, benefits, office space, utilities, and other operational expenses. This will strain your budget and divert resources from other core functions.
Hidden Cost #5: Opportunity Cost of Diverting Resources
Doing digital marketing in-house requires diverting resources like time, effort, and budget from other areas of the business which results in less focus on other critical business operations.
This opportunity cost of diverting resources from other areas of the business can be significant and could seriously impact overall business performance.
Hidden Cost #6: Performance Monitoring and Optimization Efforts
In-house digital marketing requires investing time and effort into monitoring and optimizing marketing campaigns for optimal performance.
This includes analyzing data, conducting A/B testing, making adjustments to strategies, and continually optimizing campaigns for better results. These ongoing efforts require time and expertise, which may be overlooked when you consider the total cost of in-house digital marketing efforts.
Hidden Cost #7: Risk of Skill Gaps and Burnout
Running an in-house digital marketing team can result in skill gaps and burnout. Your team may need to handle various digital marketing tasks simultaneously, which often results in skill gaps in certain areas or even burnout due to the workload.
The net effect of this is decreased productivity, increased turnover, and additional costs associated with training or hiring new personnel.
Hidden Cost #8: Risks of Campaign Failures
Marketing campaigns do not always yield the desired results and in-house marketing efforts can fail to deliver on expected ROI.
When marketing campaigns do not perform as expected, it often results in wasted resources, lost opportunities, and additional costs to rectify the situation.
This risk can be mitigated by outsourcing to a marketing agency that has the expertise and experience to create effective marketing strategies and campaigns.
Hidden Costs Of Outsourcing Digital Marketing
Like in-house marketing, outsourcing also has hidden costs, so let’s explore these briefly:
Hidden Cost #1: Management and Coordination Efforts
Outsourcing your digital marketing requires spending time communicating with the agency, providing feedback and approvals, and managing the overall relationship.
The amount of effort and time required for managing agency relationships is often underestimated, so you need to have realistic expectations and include these in your cost calculations.
Hidden Cost #2: Lack of Direct Control and Visibility
Outsourcing your digital marketing needs often results in a lack of direct control and visibility over marketing efforts, and challenges monitoring and overseeing the agency’s activities, resulting in potential misalignment with your business objectives or ineffective strategies, and hidden costs in the form of lost opportunities, delays, or rework.
Hidden Cost #3: Dependence on Agency Expertise and Availability
Outsourcing typically leads to some type of dependency on the agency’s expertise, knowledge, performance, and availability. This can result in potential delays or additional costs finding alternative solutions.
Hidden Cost #4: Contractual Obligations and Fees
Outsourcing often involves contractual obligations and fees that your businesse may overlook. These include contract termination fees, additional charges for changes or revisions, or unexpected fees for using certain tools or technologies.
It’s crucial to thoroughly review and understand the contractual terms and fees associated with outsourcing digital marketing to avoid hidden costs.
Hidden Cost #5: Potential Quality or Cultural Misalignment
Another hidden cost of outsourcing is potential quality or cultural misalignment. If the agency’s work does not meet your expected quality standards or align with your business’s values and culture, you could experience additional costs to rectify or align the work. These include rework, revisions, or additional efforts to align the marketing efforts with your brand and messaging.
Outsource Your Digital Marketing Needs or Build An In-House Team?
As we have just seen, while outsourcing your digital marketing needs to an agency has many benefits, there may also be associated hidden costs, so it’s important to evaluate the pros and cons before deciding whether to outsource or run your digital marketing in-house.
Every business has unique needs and preferences, so it’s important to do your own research and cost-analysis.
Before making any decision, first calculate the cost of running your marketing in-house versus outsourcing. Various sites provide comparison tables that can help you with this.
For example, the table below from HubSpot illustrates an estimated general cost of putting together a one-month digital marketing campaign in-house (calculated as 40+ hours of work in-house), versus the cost you could potentially expect to pay if outsourcing to a digital agency (around $6000).
Note: When looking at the above, keep in mind that:
a) The table does not take into account additional costs like salaries, training, technology, research, developing marketing expertise, etc.
b) Some of the estimated number of hours depicted in the table assigned to areas like creating blog articles and an email nurturing series seem to underestimate the time it takes to create high-quality content.
WebFX offers a great breakdown of digital marketing costs as illustrated in this summarized table…
There are other sites that provide lists or breakdowns of expected costs associated with outsourcing your digital marketing needs, including the article we wrote on additional marketing services web developers can offer.
For example, this consultancy website offers a breakdown of estimated costs for various digital marketing services, including copywriting, SEO, PPC, and video, email, and social marketing services.
For estimated salaries for digital marketing roles, we recommend visitng sites like Glassdoor.com or Indeed.com.
Another way to try and compare the cost of running your own in-house marketing vs outsourcing is to use tools like DigitalStoryteller’s cost comparison calculator.
To calculate the cost-effectiveness of using an in-house vs outsourced marketing team, look up estimated salaries using the links provided above and then enter your own figures into the calculator for fields like employee benefits and payroll taxes.
Tips for Outsourcing Your Marketing Needs to an Agency
Let’s say you’ve assessed the marketing needs of your business, done a comparison of costs, and decided that outsourcing is the more cost-effective option. Use the tips below to ensure a successful outsourcing experience:
1. Define Your Business Goals
Before outsourcing your marketing needs, clearly define your business goals and expectations. Communicate your marketing objectives, target audience, budget, and timeline to the agency to ensure that they align with your business objectives.
2. Research and Select the Right Agency
Do thorough research to find a reputable marketing agency that has a proven track record of success. Consider their expertise, experience, client testimonials, and case studies to evaluate their capabilities. Request proposals and compare pricing models to select an agency that fits your budget and requirements.
3. Establish Clear Communication Channels
Communication is key to successful outsourcing. Establish clear communication channels with the agency, including regular meetings, reporting, and updates. Define roles, responsibilities, and expectations to ensure a smooth working relationship.
4. Set Realistic Expectations
Outsourcing your marketing needs does not guarantee overnight success. In fact, according to marketing guru Neil Patel, it can take months for digital marketing to generate results.
So, set realistic expectations and understand that it takes time to see results. Trust the expertise of the agency and allow them to implement their strategies effectively.
5. Monitor and Evaluate Results
Regularly monitor and evaluate the performance of your marketing campaigns with the agency. Review reports, analytics, and metrics to measure the success of your marketing efforts. Provide feedback to the agency and collaborate on any necessary adjustments to optimize results.
Outsourcing To A Digital Marketing Agency – Next Steps
When it comes to evaluating whether to outsource or keep your marketing in-house, it all boils down to this:
If it’s more profitable to focus your time and resources on your business and outsource your marketing needs externally, then you are better off outsourcing and utilizing your time and resources to find and serve new and existing clients.
You will experience cost savings in terms of opportunity cost, as you can now potentially generate more revenue from activities that outweigh the expense of outsourcing, focus on your core services, and manage your time and resources more efficiently.
If your research and calculations show that outsourcing your marketing needs:
- Is more cost-effective than running an in-house marketing team,
- Will help to improve brand awareness, increase website traffic, deliver higher conversion rates, and drive business growth
- Provides desirable benefits like cost savings, the flexibility to scale your marketing efforts based on your needs and budget, access to specialized expertise and professionalism, time savings, and more
Then the next logical step is to reach out to a digital marketing agency and begin exploring what services they offer and how they can help you achieve your marketing goals.
If you don’t know where to start, we recommend putting a list of questions together and checking out our digital marketing agency directory.
Our agency partners are experienced professionals who can assist you with all your digital marketing needs.
To view all listed agencies and their available services, visit our Agency Partner directory or contact our 24/7 support team if you have any questions.
Note: If you are a digital marketing agency or provide web development services, learn how to get your business listed on our directory.
