When and Why You Should Recruit a Marketing Agency, Consultant or In-House Team

Post by Tom Baker
31 Aug 2018

Working in marketing is all about decision-making. Being a successful marketer is largely dependent on your ability to understand your objectives and make informed decisions that help you achieve those goals.

One of the most important decisions you will make as an in-house marketer is what resources you need to help you achieve the objectives.  This is a big and never-ending topic of discussion (see here for a general overview, Lego’s experience and Lucozade’s experience) but as trends change there are some persistent truths which you can use to improve your decision making.

Often that discussion centres around three choices

  • Develop an in-house team
  • Source an agency
  • Recruit a marketing consultant

I’ve used all three options and sometimes a mixture of the three in my 10 years working in-house.

This can be a tricky choice so here’s a rundown of the circumstances in which each option is the most beneficial to you as an in-house marketer.

TL:DR Version

  • Use an agency when you need specialist skills (including when its tough to recruit those skills), believe there is an opportunity to scale, need quick results, believe there’s a benefit to working with an agency that can apply knowledge from other clients
  • Use a consultant when you need specialist skills, want to test new channels without investing a lot and when you need services on a flexible and infrequent basis
  • Recruit an in-house team if you’re planning for the long term, if you want to build a more collaborative team with a stronger feel for the brand and business data, when you’re communicating directly with customers and when you need to increase output (creative, socia media etc.)
  • Consider your own strengths and weaknesses. Build a structure that let’s you concentrate on your strengths and find others to do work that you’re naturally less inclined to do.

 

You Need Specialist Knowledge

This is the number one reason that people partner with agencies or consultants. Even when you need someone to complete a task, let’s saying writing blog posts, you are far more likely to achieve your goals if that person is an experienced blogger or copywriter. The same principle applies when you are considering much larger projects. To give you an example, whilst Head of SEO at an international sports betting company I had to make a decision between recruiting a team or sourcing an agency. Here was my thinking;

  • I already had three people in the team who each managed a group of websites. They were generalists who ‘owned’ KPIs related to those websites. It was not realistic of me to expect them to complete these managerial tasks as well as dive into the myriad of niche skills that are required to rank a website in a very competitive sector.
  • Recruiting true specialists for in-house roles is extremely time-consuming and difficult. At a minimum I would have needed a technical SEO, analyst, an outreach team and a creative team. Let’s say that was 10 people. Even with an optimistic view of the recruitment process it would have taken at least 6 months to fill all of those roles. So why not tap into an agency who have a ready-made team of specialists that can start work straight-away

Specialists are vital in areas when you don’t need full-time resource. Let’s say you’re embarking on a TV campaign. It would be madness to recruit people in-house to conceptualise, produce and direct TV ads. It’s a highly specialist area and one you’re likely to only need a few times a year at most. Take advantage of the flexibility an agency can give you and make decisions on how you use that resource based on business logic. An in-house team often compels you to use them even if there’s not great need for it.

Sector Expertise Gives you an Advantage

If time is of the essence then this factor is particularly important. An agency or consultant can adapt strategies from other clients and quickly apply them to your business.  In my SEO example, this was again another factor that persuaded me to recruit an agency. There’s an asymmetry of knowledge between the search engine and the SEO.

An agency or consultant can counter this asymmetry to a greater degree than an in-house team because they will be able to apply learnings from a wide range of sectors. Their larger data set, as it were, gives them an advantage over an in-house team who can only see results for the websites they’re working on. The same concept applies to media buying. Agencies should have access to much greater inventory and at better rates than what you can source as a single brand.

 

You Want to Test Before Committing to a Channel

You may want to venture into a new marketing channel or try out a new tactic within a channel. Everyone should be looking to test new opportunities to grow revenue or build brand awareness but the last thing you want to do is over-commit and create infrastructure at a time when you have very little evidence that it is going to pay-off.  

De-risk your strategy by recruiting a consultant. Put them on a short-term contract with very specific goals. Time-bound the project and give them all the support they need to meet the objectives. If they’re successful then fantastic, you’re closer to meeting your objectives. You can now decide whether to extend the relationship, scale up to an agency or build an internal team for the longer term. I’ve found it to be one, if not the strongest, reasons to choose the consultant route.

 

Create a Structure that Allows you to do your Best Work

It is perfectly reasonable for the decision to be informed by your own strengths and weaknesses. You’ll do your best work when your personal goals are aligned with business goals. If you have a strong strategic vision but aren’t great with attention to detail then outsourcing the executional aspects of the strategy makes perfect sense. Similarly, if you have developed a specialism in a certain area and like being hands-on then you should be more open to building an in-house team around you.

Often as an in-house marketer you are spending a lot of time in meetings, reporting and line managing. Outsourcing is a great way to continue to scale the channel whilst allowing you to complete your other tasks to the best of your ability.

 

There’s an Opportunity to Scale Quickly

It’s vital to take scale into consideration when deciding on the right resourcing plan. By scale I mean the ability to increase the output and return on investment as you start to meet your objectives. The last thing you want to do is see the results plateau after all of that hard work you’ve put into the strategy and execution.  

Using an agency or consultants gives you the flexibility to increase the workload and continue to expand your operation. It’s important to point out at this juncture that your chosen agency must have greater capacity in reserve that you can tap in to.

I’ve seen instances where agencies can’t cope with the workload. This only leads to poor results. Either the work doesn’t get done or they recruit freelancers who have zero grounding in your business. Their third-hand knowledge is not a recipe for success. Do not fall into this trap. When evaluating agencies you must challenge their ability to scale with your growth expectations.

A good agency will be able to quickly shift experienced resources your way to sustain your momentum.

Consider How Budget Impacts your Choices

It sounds churlish to say that cost is a decision making factor. Of course it is. It’s important is to consider the cost implications and the impact that has on your business.

If you’re a start-up every cost has an impact on the bottom line. Consider how recruiting an in-house team increases facilities costs and employment tax. Roughly speaking you’ll add 20% of salary as the cost of employment. That can make a considerable difference to your profit and loss management. If the work is likely to include lots of small and frequent tasks, social media management, creative production being two good examples then it’s best to either recruit in-house resources or use consultants on a ‘pay-to-play’ basis.

Consider something that we touched on earlier – don’t get caught up investing lots of money into infrastructure only to find out that the marketing activity doesn’t pay off. It’s normal for some activity not to work. Don’t get yourself in a situation where you’re spending money with little confidence or room for manoeuvre.

What I will say is always measure your agency or consultant based on the output (return on investment) not the input (fees or time). I see this mistake so often it makes my eyes bleed. Let me be clear. It doesn’t matter what you pay an external partner as long as they are achieving the target return on investment. It’s human nature to not want to spend lots of money but this is the wrong lens to view your decision-making through. Don’t waste time counting beans. Focus energy on the return you get for each marketing pound/dollar/euro you spend.

 

How Quickly Can the Objectives be Achieved?

You may be blessed with a leadership team that has given you space to build a long-term strategy. This is often a reflection of the health of the business or the particular channel you are working in.  For example, whilst I was working on a branded content strategy in support of a 3 year sponsorship deal my CMO had the foresight to realise that content rarely provides quick returns but by investing for the long-term we could be something truly special. And that’s exactly what we did.

With the understanding that it was not possible to produce immediate returns we had the creative freedom to build an audience through authentic and high-quality journalism.

If you’re in a similar position my advice is to recruit internally. Make lots of mistakes in the early days whilst there is little pressure for results and you’ll see a large pay off in the longer term.

If you need results immediately or you’re working on a channel where it’s possible to achieve quick results, usually any type of paid media, then it does makes sense to recruit a consultant or agency. Your choice between consultant or agency will largely depend on your confidence levels as we discussed in the De-Risking section.

 

What’s Best for the Brand

One of the biggest mistakes I’ve seen is the decision to outsource the company’s ‘voice’ to an external group.  It is rarely a smart move to outsource social media or customer service to people that do not live and breath the brand tone of voice. If your company’s product or service is niche or requires specialist knowledge then don’t expect an agency to have that knowledge or speak in your customer’s language.

This is my strongest reason for building an in-house team.  If you’re tasked with representing the brand in a public forum and talking directly to customers go with the internal team approach. Recruit people that love the brand, who have the specialist knowledge and who are already active within the community.

Tone of voice is hugely important. Don’t dilute it by handing it over to a third party.

Now you may say, Tom, there are plenty of brands that outsource communications to agencies. And you’d be right. The difference is that they are often working on in-direct communication – TV advertising, radio, out-of-home. They’re not having a dialogue with the customer. It’s a one-way conversation which means it’s so much easier to get the tone right.

 

Agility is Vital but the Choice is Dictated by the Type of Work

Another strong benefit of building an in-house team is the ability to move fast and get things done. On first glance this may appear to contradict my points about scale and specialisation. The difference is in the type of work that needs to happen.  If most of the work involves collaborating with other external parties – outreach, influencer relations, PR etc. – then an agency is likely to be more agile than an in-house team. Especially if you’re starting from scratch.

However, if the work involves mostly internal collaboration across different teams – data analysis, product development, CRM etc. – then an agency are going to struggle to build the relationships and maintain the constant contact required to move projects along.

This distinction should suggest one optimal way of resourcing your project.

  • go external for work that rarely involves working across departments
  • choose internal for work that requires internal collaboration

With this mix you get the best of both worlds. The trick is to understand which tasks fall into which category. Once you have that you’ll have created a highly efficient team structure.

In recent times we’ve seen a move from very large companies to shift more of their digital marketing operation in-house. You can read more here. The calculation Vodafone made was; build a cross-disciplinary team that is closer to the data and can move quickly. Use agencies when specialist skills or scale is required.

 

Developing Business Intelligence

As the Vodafone example shows us developing knowledge and expertise in-house, if done correctly, will lead to a much stronger business. You will end up with a collection of people with a better understanding of the marketing strategy, who can more effectively collaborate and for larger businesses are likely to cost less than an agency.

In this day and age, the speed and frequency of your testing and iteration process is fundamentally important. The second benefit is the legacy that can be created. If you can create a successful culture and marketing philosophy then bringing new people in to the team becomes much easier.

If you’re known outside of the four walls of your business as a highly effective marketing team then you’ll find it easier to recruit specialist skills (one of the major reasons for using an agency). So you can see a determination to develop knowledge in-house becomes self-fulfilling and a more effective means of meeting your objectives.

 

So there you have it. Often your choice is not an ‘either or’. Find the right balance that allows you to create a sustainable growth strategy that utilises all of the benefits of external support whilst maintaining flexibility and ownership over strategy, data and brand.

Tom Baker

The guy writing this stuff. Previously worked in-house doing all sorts of marketing for start-ups and large brands. Now devising marketing strategies and executing for small, medium and large brands.

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