Working With a Marketing Company vs. an In-House Hire: Which Will Yield a Better ROI?

When your business is ready to expand and attract a higher volume of customers, the next logical step is marketing.

While you know marketing is critical, deciding between an in-house marketing specialist versus outsourcing to a marketing company is not as easy of a decision.

Naturally, you would assume paying a salaried marketer would yield a better ROI, but you might be surprised at what you are giving up (and costing your company) by hiring in-house versus outsourcing.

The Outsourcing and In-House Conundrum

Every business will face a challenge of whether to engage with external marketing businesses or hire in-house staff.

To overcome this crossroad, it is best that you assess the pros and cons of each, and never take one or the other for face value. While the price might be steep for a marketing company upfront, the long-term costs are most likely less than the cost of hiring a long-term employee.

So, consider the long-term returns, overall investment, and the bang for your buck before choosing one or the other.

Comparing the Benefits of In-House versus Outsourcing to a Marketing Company

1. In-House Brand Knowledge

An in-house marketer works for your company and your company only. So, it is only natural for them to fully engross themselves in your firm’s vision, mission, history, goals, and more. They know how to project your brand because they are part of your brand.

Having in-house knowledge is great, and a marketing company will not compete with the in-house advantage.

However, that agency has experience handling brands from all industries. Therefore, they may have more powerful knowledge about how to research demographics and target a particular consumer than your in-house hire that only dabbles in one industry.

2. Industry Expertise at Your Fingertips

When you search for an in-house marketer, you are looking for someone with specific experience in your industry. This is incredibly valuable, especially if you are in a niche industry.

With your in-house hire, you get an expert, but you get the same at a marketing company. In the case of a company, you have a plethora of experts, and possibly more than one with experience in your industry alone.

3. Faster Marketing Progress

If you work with a marketing company, you might have to wait for plans to go through multiple departments before they reach you for approval. With an in-house marketer, you have access to all departments, can approve or modify plans, and implement them much faster.

While there are a few more connections to deal with when you hire a marketing company, you also have a streamlined, automated marketing process.

Your full-service marketing company can handle everything from website marketing to content production and more with minimal input from you. That frees up your time for more important business matters.

What About the Drawbacks to Hiring In-House versus Outsourcing to a Marketing Company?

1. Finding Talent is Not Easy with In-House, but It is with an Agency

It could take quite a while to find talent for your in-house position. In fact, one report from Bersin by Deloitte noted it costs up to $4,000 for a company to fill a position. When you hire a marketing agency, you do not have those position costs, and you have instant access to a team of qualified personnel.

Also, if you do not like the talent at the marketing company you select, you can cut ties and cancel the contract.

When you hire an in-house marketer that does not fit your style, the process of terminating and refilling that position is quite costly. In fact, the Employee Turnover Calculator estimates a company will lose approximately $5,492 on an employee paid $50,000 per year.

That cost does not include the cost of a severance package, COBRA-hosted benefits, employee paperwork out processing, and the cost of having other employees cover that work.

2. Your Single Hire Will Have a Limited Capacity to Their Work Volume

If you hire one marketer, you can only give them as much work as their workload can manage. When they reach maximum capacity, you might have to hire an additional marketer. For much less than the cost of one marketer, and especially two, you can send as much work as you have to a marketing company.

A company could employ anywhere from a handful to dozens of employees; all ready and able to take as much work as you need.

Even better, marketing companies scale their work. So, when you have high demand months, you can add on the services, and save on costs when you do not need marketing.

3. You Do Not Benefit from the Outside Perspective with In-House Hires

An in-house hire does know your brand, but they cannot give you the outsider’s view into your marketing strategy.

Marketing companies are not personally tied to your firm and they relate to your brand professionally; therefore, they offer a bigger picture perspective. They can give you the outsider’s view, like your customer’s view, and help you design something that is effective without being overly promotional.

4. It Will Cost a Hearty Upfront Investment for In-House Help

The average marketing specialist today earns $51,980 per year. However, this does not include the costs of benefits, retirement funds, payroll taxes, and the office space you must provide to employ that marketing specialist. So, you could spend tens of thousands more easily per year on top of the $51,980 salary.

The kicker? You only get one person for that price.

Forbes did an article on the cost of digital marketing, specifically homing in on how much less marketing services are than business owners think.

While you will pay a monthly retainer for that marketing company, you will notice that your dollar goes further. Just some things you unlock for much less than $50 or even $30k per year include:

  • A Team of Experts, Not Just One: Instead of paying over $50k per year on a marketing specialist, you get a team of marketing professionals that you do not have to supply a retirement account, benefits packages, or office space. If you have higher marketing needs, imagine what you would pay to hire an entire marketing department or even two marketers compared to the cost of an agency?
  • Flexible Billing: You are paying for services when you need them. So, even if you were to spend $50k per year on a marketing company, you are only paying when you need to utilize their services.
  • You Will Spend Less Per Quarter, and Earn More Back: When you are comparing the cost versus returns on your investment, you will find that you get much more back from a marketing agency than an in-house hire each quarter. The average industry project fee for an organization with up to 50 people ranges from under $1,000 to $10,000. With that price, you get measurable metrics that you can compare to the overall cost, and you will see how your dollar stretches much further than the $51k you spend per year on in-house staff.

So, Who Wins? You Get More Out of a Marketing Company

When you compare in-house hires to a marketing company side-by-side, the savings and returns often come from the agency over the in-house hire. While aggressive content marketing could benefit from someone in-house, you do not have access to the same volume of work capacity, credibility, and cost savings that you do with a company.

A company’s focus on marketing alone will be an asset for your business, and it offers a strategic partnership that provides you with a better ROI long-term.


Want to see what a marketing company can do for you? Contact the full-service marketing department at Ravenshoe Group today or explore the results we pulled off for our past clients.

 

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