For many startup and business owners, an initially daunting task to accomplish is to build the marketing department. The reason being they have three choices in front of them:
- Build an in-house marketing department
- Outsource the marketing to an agency
- Hire a marketing consultant
Each of the choices has its pros and cons. An in-house marketing department ensures control but can be quite costly. An agency has the expertise, but it can be challenging to get deliverables in time from them. A consultant can give great advice but may clash with your CMO.
If you are a founder who is deciding between the three choices, this blog is right. Here we will discuss the three options for you, list the pros and cons, and select one based on your needs. Finally, you will learn about someone who can combine the best of all three and give you the best results.
Why do the differences matter?
Marketing is a massive investment for any business. The ROI from it is enormous as well. Facebook today, for example, has more than 1.6 billion monthly active users who are on this social media site on an average of fifty minutes! So it is essential to select the right people for any business’s marketing.
But more importantly, marketing departments in any form and in any business are unstable. One LinkedIn analysis shows that the turnover rate for marketing roles is 17%- the highest among any functions. Another study by MarketingWeek shows that less than 10% of brands are ‘very satisfied’ with their hired marketing agencies. Therefore, you also need to choose people who are going to stick with you and make your marketing a success!
Now that you know the importance of selecting the right marketing structure for your company, let us look at the three options available and their pros and cons.
A hybrid between the In-house marketing department and agency is a model where the business has an in-house Chief Marketing Officer (CMO) and outsources to the agency at the same time. The CMO handles all the managerial and strategic decision activities while the agency carries out all the operational activities.
The pros and cons of hiring an agency are mentioned in the next section. So here we’ll discuss the pros and cons of an in-house CMO.
Pros-1: Works only for your project
You definitely will pay a CMO a lot to work for you and you only. Therefore, you can expect the CMO to dedicate all his efforts into your business’s marketing activities. They will not have other commitments like agencies and consultancies do.
Pros-2: 9 to 5 at your service
Since they are in a C-level position, they will feel a level of ownership of your business that agencies or consultancies will not. With such a great feeling of autonomy, they will give the best to you. You can expect them to be at your service 9 to 5, perhaps even longer.
Pros-3: Can be the future CEO
If you plan on succession, an in-house CMO can be the best fit for the CEO, provided they have done their job well. With experience in a C-level position, a CMO can be a natural successor to the outgoing CEO.
Cons-1: Internal or CEO influence
Because the in-house CMO works within the organization, they might get immersed in the culture and bureaucracy of the company. This immersion means they might be influenced by the CEO or company politics when working. It might affect the CMO in making the right decision for the brand.
Good CMOs start from $8,000 a month. If you are a small business, such a salary base can be unaffordable. Besides, a C-level executive may also demand other benefits like insurance, stock options, executive bonus, and other perks. Providing these heavy benefits can put a dent in your budget.
Cons-3: Hard to find the right talent
Like any in-house department personnel search, finding a CMO can be a tough job. Because of the top-level position, the search can be even harder. You need to have a CMO with a proven track record of bringing success in their previous work experience. Recruiting such can be like finding a needle in a haystack!
In this option, you outsource your marketing to an external marketing agency. It is an excellent choice for small and medium-sized businesses who might find it hard to concentrate on marketing when there are many other things to do.
Pros-1: Diverse specialties and expertise
A marketing agency has its own set of web developers, social media managers, SEO technicians, graphic designers, content writers, and people for other digital marketing roles. These diverse resources help the agency cater to any type of marketing problems faced by clients.
Moreover, as marketing agencies work with different types of companies, they gain expertise in their field over time. Such knowledge may be hard to find when evaluating candidates for an in-house marketing team.
Pros-2: Process and tools
The right marketing tools can help your company’s productivity, efficiency, and performance. Although there are free tools available, you will feel the need to use some premium software and tools. If you are a small startup with few resources, buying the software can be costly. You will also need to train your employees in the new tools.
On the other hand, Your business will not have to worry about researching or purchasing marketing tools if you hire an online marketing agency instead. The agency already has access to such resources, including keyword analysis tools, and will use them for your plan. Indeed, you will save a lot of money!
Cons-1: Little control and communication
Since you outsource your marketing activities to the agency, your control gets reduced. Sure, you will have the final say in the process, but the agency will take over most of the work. If you find such little control to be risky, you should not go for an agency.
At the same time, there is also a barrier to communication. Agencies will mainly prefer phone or email contacts and thus bypassing any methods of informal channels. Waiting and response time will, therefore, be longer. They will also restrict their physical meet-ups to weekly or monthly.
Cons-2: Late deliveries
A significant problem with smaller and lesser-known agencies is that they deal with a lot of clients simultaneously. Therefore, there will be times when your works will be delivered late. Of course, a reputed agency will not create such problems for you. Therefore, when searching for an agency, choose a trusted and reliable one for conducting your marketing activities.
The third option is to hire a marketing consultant. A marketing consultant can help you develop your marketing strategy, identify problems in your marketing campaigns, and recommend solutions. Unlike an in-house CMO or an agency, a consultant is expected to provide service for a limited amount of time (1 to 6 months).
Pros-1: Expertise to work for you
A marketing consultant usually has expertise working in companies for years before they switch to consulting. As a consultant, they also have experience working with clients. What sets them apart from agencies is that they usually work alongside their clients. Whereas agencies just take in requests and proceed with them. Working alongside your business thus gives the consultant a sense of ownership, and they are ready to utilize their expertise in fulfilling your goals.
Pros-2: Third-party perspective
At the same time, a consultant brings their perspective into their clients’ works. As they work alongside you, they can share their honest feedback to your existing operations and recommend much-needed changes. Although a consultant works alongside you, their expertise helps them bring a fresh perspective to your business. On the other hand, an in-house marketer becomes absorbed in the company culture for which he cannot think outside the box.
Hiring a marketing consultant can be the most cost-effective among the three options. Besides salary, an in-house marketer will also require other benefits like insurance. A consultant, however, mainly works on a contractual basis. So the compensation will be determined by the hours worked.
Plus, the expertise brought about by a consultant helps you in multiple areas of your marketing, like sales, content marketing, advertising, etc. So the costs of a lot of personnel are replaced by one consultant. It is indeed great money saved, especially if you are a business just starting.
A consultant may work with 4 to 5 other clients at the same time they work with you. As a result, they might not always be available on demand. They might hold weekly communications with you and discuss progress. But for daily interactions, you might need to resort to formal means like those with agencies.
Cons-2: Clash with Inhouse CMO
Usually, a CEO hires the consultant. For some CMO, such a referral from above may not be seen in a positive light. Moreover, a consultant brings an external perspective to the business, and the recommendations may be seen as intrusive by the CMO. There might also be conflicts regarding undertaking specific strategies and campaigns.
As a CEO, you might be in the middle when it comes to such conflicts. To avoid conflicts, work with your CMO to select a consultant. This collaboration will reduce differences and hostilities.
How to choose between the three?
Now that you know about the three options let’s decide on which one to pick. The pros and cons are not enough as your conditions might differ. But here are three common factors that you can use when choosing among the three.
1) Goals of your digital marketing strategy
The goals of your digital marketing strategy should determine whether you opt for an in-house marketing head, an agency, or a consultant. For example, if your goals are just to maintain the current sales figure, an agency will be excellent. However, if your goal is to improve sales, a consultant can give you the necessary strategies required to achieve the goal.
Budget is probably the essential factor for any business, mainly for smaller ones. Although an in-house marketing head might be great, it might cost you plenty. A consultant and an agency’s costs might differ according to the plan you decide to take. So set up your marketing budget and then decide which option you will like to make.
3) Current Condition
Finally, your current condition (apart from budget) will also determine your option. Do you have a strategy and are working well? If so, then an agency will be excellent for you. Do you wish greater control over the campaigns? Then an in-house marketing team will be right for you. Is your strategy not working at all? A consultant will be the answer.
A digital marketing consultant to fix your problems: Najm
If you are having problems developing a strategy, generating leads, or getting customers, I, Najm, can help you. With my 12 plus years of experience in corporate and startup marketing, I know your marketing needs, irrespective of whether you are a small business just starting or a large one facing a new threat. So you can expect me to bring the best of all the three options (in-house, agency, and a consultant) and give you results.
Here is what I bring to the table:
1) Strategy + Execution
If you want to build a strategy for marketing automation, outbound marketing, inbound marketing, or any digital marketing strategy, I am here to help. But I can go a step further. Under the Funnel, Outbound, and Complete Packages, I not just develop a digital marketing strategy for your company but also execute it. So you get both the works of a consultant and an agency.
2) In-house Marketing team building: Both remote and on-location
You wish to have a marketing team of your own. I can help here, as well. From job identification to onboarding, I can work with you to build your dream marketing team. Whether you want the team to be remote or on-location, I can develop both.
3) Work hybrid (both on-location and remote)
You can decide where you want to work with me- at your office or mine. I am comfortable with both. This way, you can choose to work with me based on your convenience.
The world of marketing is ever changing. Therefore, you need to select people who are adept at the changing marketing world. The in-house, agency, or consultant; whatever you choose, make sure they help your company wade through the rough seas of marketing. Happy sailing!