Managing Digital Marketing Teams: In-House vs. Agency
You need more: bandwidth, expertise, results. Should you build out your team? Hire an agency? Automate? While there are advantages and disadvantages of each path, the likely answer is a combination of all three.
This guide will help you understand the tradeoff of each option and create an actionable plan for better results from your digital marketing programs.
In-house vs. agency marketing: what’s the difference and what is better?
In-house marketing refers to marketing that takes place in your own company (e.g. SEO, content production or branding). Agency marketing would be outsourced to an external company.
So how do you determine what is better? We’ll go through the advantages and disadvantages of all potential scenarios, but we think Eric Vardon said it well:
“It’s crucial to weigh both sides to see what’s right for you. So, as you review your strategy for next year and the years to come, make sure that your money is invested where your brand will see the greatest return. The right decision will be the one that allows you to focus on what you do best: selling, closing leads, and growing and operating your profitable business.”
Even the smallest team is going to have someone internally at the company who is responsible for the digital marketing efforts. By running things internally, you have a closer connection to the rest of the business and reduce friction but there are trade offs. Here are some of the pros and cons of doing things internally.
Advantages of in-house marketing
Marketing professionals in-house know the company and its mission much more intimately than an external worker-- it's only natural that they would put their heart and soul into the work. The company’s success is important to an in-house team, and the dedication and interest in their work will show that. It’s also easier to stay motivated and keep focus when working with an internal team, which can only be a positive thing.
In house teams know your brand and in many cases will be much more effective as a result. Having a team of copywriters or brand marketers particularly in-house is advantageous because they understand the company’s product, culture, and philosophy. This ensures that the best approach for your company is used for your content. Pick the right team and let them be in charge. They will know the most about what to say, how to say it, and who your target audience should be. Your employees get to know your service and product better than it would be possible for external consultants. Internal teams will also be more motivated to make every campaign excellent, which will reflect positively on the quality and level of performance you can see from your marketing strategies.
Communication and accessibility
Naturally, since in-house marketing teams spend all of their time working on one brand, you can easily get a hold of them and communication is usually quick and easy. Agencies can be hard to reach because they're not working exclusively on one brand and they often have to plan production timelines weeks or even months in advance.
When outsourcing to an external agency, they could have existing relationships with one of your competitors or establish new connections that you weren't even aware of. It’s important to be aware of your agency’s client list as much as possible and avoid marketing firms that have worked with competitors who hit too close to home. You’ll have a greater likelihood of getting quality, personalized work if your agency has worked near your space, but not with a direct competitor.
Another factor to consider is how agency partners work internally on their end. In order for agencies to provide the best service, they will often keep fulfillment teams completely separate from clients which can sometimes lead to work that is redundant, lazy, and simply not customized enough to you. Agencies who specialize in a single industry are also often known for “rinse and repeat”ing the same marketing strategies. So businesses are often left with the choice to either work with agencies who are not the best fit for their needs, or take the risk in trusting that a more specialized agency is indeed giving them custom work and not putting a new label on campaigns they’ve already run for other clients.
When working with your internal team, none of this is a concern of course, as all parties have the same common, shared goal: make the company successful. The right agency partners can provide this too, but it is certainly harder to come by with an outsourced team, than one that is directly employed by the company.
Drawbacks of in-house marketing
Focus and monotony
It can sometimes be challenging to focus on a single thing for a very long time. Especially when employees could potentially get bored and not like the work, as there is no guarantee whoever you hire for an internal team will automatically fall in love with the company and their position. Too much monotony, repetition, or boredom fosters an environment of less creativity and bad habits. This will result in your team losing sight of the big picture. Keep abreast to how your team is doing as individual people, and make assignments or projects as diverse as possible to keep things spicy. In many cases, a positive work routine with a healthy amount of variety can not only help managers and employees to be more confident about the work that they do, but also make decision making processes faster, as well as ensure consistency throughout the company.
In order to create high-quality marketing material and run a successful advertising campaign, you will need lots of talent on your team, or be prepared that the amount of work produced has its limits…based on simply the number of people you have. If you don’t have enough talent available in-house to get a particular task done, the next best option is to hire an ad agency, and for many companies this is where a combination of both internal and external teams is the best choice. If you opt for this route, let your in-house teams manage the direction and vision of your marketing campaigns, and then fill in gaps in resourcing from your agency partners.
The brass tacks truth is…if an agency’s work doesn’t pay off, it’s far easier to terminate your relationship with them than it is to let go of even one employee. Now, it’s still not pleasant or fun to onboard agencies to your company’s process every three to six months, so finding a long-term partner in that respect is still the best way to go when looking at agencies as well as internal hires.
But especially an in-house marketing team is built with long-term strategy in mind, so as long as you are careful and thoughtful during the hiring process, having your own people is often well worth the risk. Keep in mind that recruiting and training a new team member can also be a slow and arduous process so ramp up time must be built into your timelines and projections. Once onboarded however, a quality internal team member can add more value in a short period of time far more than most agencies.
Advantages of utilizing agencies for digital marketing
Less investment upfront
Doing an in-depth cost analysis of what’s the lowest investment between all options we’re looking at for resourcing your marketing is not a straightforward process by any means. While in-house employees tend to “cost” more than an agency initially in terms of salaries, your bottom line could end up bearing the burden of that cost savings in the long run from poor performance, fewer deliverables, or simply a lack of familiarity with your brand and your company’s needs. However, what agencies can offer that outshines internal teams is that they can offer many services for a lower overall fiscal investment. If your company is a startup or on the smaller side, and budgets are tight, using an agency only may be the best bet for you. Many marketing firms are open to customizing their packages so it works within your budget and you can always renegotiate the contract if you would like to increase or decrease spend. But be sure to have a lawyer review all documentation before going into an agreement, as it is fairly standard in the industry to build in cancellation fees or a required percentage of buyout for early termination. To give you a rough idea of what hiring in-house may be for some of the professionals you would be able to work with through an agency, we’ve outlined below a few common salaries in the U.S. (updated June 2022)
- Digital Marketing Manager: $120,000
- SEO Specialist: $60,000
- Director of Growth Marketing: $165,000
- Social Media Marketing Manager: $55,000
If you take the median of these salaries, you will get an average salary of $100,000 per year. If you had a team of 3-6 people, it would not be surprising to put aside anywhere from $300,000-$600,000 per year in salaries, not including benefits like 401K, equipment, healthcare, or any other company perks.
In comparison, digital marketing agency fees can range anywhere from $50,000 per year to a $1,000,000 per year or more…depending on your needs. Keep in mind that this does not include paid media spend as well, which often requires a somewhat significant investment. From a fiscal perspective, the outcome for your business could vary drastically between an agency being far more cost-effective than an in-house team clear up to the two scenarios costing about the same, or even an agency costing your business more than full-time hires. In most cases, agency work will come out to be cheaper, but as we list here there are trade offs, so be leery of making this decision fiscally first. Ideally the overall cost ought to be the last consideration after all other factors have been weighed and measured.
Fewer administrative headaches
Agency marketing is great because of the level of freedom and flexibility it can offer. There’s very little hassle for the client in terms of resourcing because if an agency takes on more work than they can handle, filling that workload is ultimately the agency’s problem. This step removed can be a huge burden lifted for many business owners. Not to mention, you don't have to worry about issues like employee turnover, which is a consideration when hiring people on staff. An agency ensures your strategy is never put on hold. However, statistically marketing agencies have some of the highest turnover rates out there, so while your work will never stop i.e. there will always be someone to do the work–the person fulfilling your work is likely to change often, which could affect quality.
More varied and diverse expertise
By partnering with a marketing agency, you have the chance to choose from some of the best marketing companies in the industry. In terms of marketing as a topic at large, you’ll usually get excellent broadstroke marketers that have done a little bit of a lot of things. Because agency professionals have to be flexible enough to work with a myriad of businesses at once, they tend to understand the mechanics of marketing and on-the-ground execution quite well. Agency pros are also often on the cutting-edge of great marketing strategies and techniques and they have unique insight working alongside dozens of other marketing professionals, all day every day. This provides a passive knowledge-sharing and training that most marketers can only get in an agency environment…as it is quite rare for in-house teams to be big enough that they have the same level of diversity in expertise among their team members.
Potential disadvantages of agency marketing
Lack of industry knowledge
Some agencies have only been active in a handful of industries, while others work with almost anyone and everyone so they have shallow, broad knowledge of many industries. If you come from a niche industry, it may be the case that some agency marketers know nothing about your field. Consider this and other circumstances when seeking marketing help. It is worth looking at their previous work to establish whether they have dealt with clients from your particular field before or whether they have a close enough relationship to your marketing strategies that the learning curve will not be too steep and painful. Kate Churkina of SEMRush said about this,
“Just because one solution worked for one client in a certain industry doesn’t mean it’s suitable for another client in a completely different industry. Failing to understand the nuanced parts of your client’s business can often lead to unforeseen obstacles during the course of a project and leaves your client questioning your every move.”
It’s important to keep in mind that when you start working with a new marketing agency, they need quite a bit of guidance, so have patience and plan accordingly. As you get to know them better and vice versa, eventually you will be able to step back and let them do most of the work, as any agency worth their salt will take your feedback over time and responsively adjust. While it takes time for the agency’s various specialists to get your brand tone, message, and creative direction just right, if they are well-managed and well-structured…it will improve over time, and they could even become a natural extension of your company.
Agency teams are often stretched thin
It is not uncommon for marketing agency teams to have too many customers and not enough people to support them. A recent study indicated that agency account managers may need to manage as many as 14 accounts on average. Having so many people to correspond with, so many objectives to reach, and so many projects to oversee is a recipe that can sometimes lead to project deadlines being pushed and missed.
An agency should set realistic deadlines and prioritize client work according to expectations that are clearly laid out from the beginning. Most companies are realistic about the fact that they are trading lower costs for longer timelines, but that of course is tied to the caveat that those timelines will still be clear and agreed upon. Communication is key. When shopping for an agency partner, consider the number of clients a marketing agency has on their books before you decide to enlist their services and ask candidly about their employees’ work-life balance. This should give you a rough idea of how much time they are likely to have available for your project or if your outsourced team is simply too busy or not structured well enough to give your company the time you need.
The thing about top agencies is that they charge the big bucks for high-quality services while smaller agencies may be getting creative or cutting corners to make the dollars and cents work out. Consequently, this essentially means you get what you pay for–while most agencies try to have a good mix of more experienced and junior talent, the reality is more expensive agencies will likely be hiring great marketers with more knowledge at a higher competitive salary. But, there are many small to mid-size agencies that are structuring their businesses smartly to give newer professionals opportunities under the close guidance of more experienced mentors. Understand before getting bids from multiple companies that internships and entry-level fulfillment is an innate part of the agency industry, as its one of the best ways to keep costs reasonable and keep hires on for longer as they have the opportunity to be promoted within the company quickly. A quick rule of thumb: when choosing an agency, it's good to look for one whose clients are similar in size and revenue to your business.
How does automation fit into the picture?
In short, marketing automation is the time-saving way to outreach, auto-respond and get closer with your customers through machine learning and artificial intelligence. Automation allows you to send exactly the right message at precisely the best moment, which can enhance and deepen your interactions with customers while saving your real-life staff precious time. By letting bots and software do some of the redundant, repetitive tasks…your internal and external marketing teams will be able to keep their brain space and efforts reserved for what really matters: creativity, innovation and new campaigns that will drive the growth of your business.
So now what? Do I have to choose? Who do I hire?
We know that working with an in-house marketing team vs. an agency can be tough and isn’t the most straightforward decision.
Unfortunately, we can't provide you with a definitive answer that is best for your business—every situation is different. What we can say is that there are some pretty common themes we’ve seen across many different industries:
- If you’re a smaller business with few clients, you might be able to handle your marketing campaigns on your own with a small in-house team. On the other hand, if you are growing as a business and looking to scale up quickly, an agency might be the way to go.
- For many mid-sized companies, a mix of agency and in house teams is idyllic because it offers the company flexibility to speed up or slow down initiatives depending on their goals, seasonality, or logistical roadblocks.
- Enterprise businesses tend to also do well with a combination of both agency and in house marketers, but the biggest difference we’ve seen here from the mid-size market is that there are simply more dollars floating around, more people involved to manage both internally and externally, and in general this makes decisions or pivots slower and more arduous. Enterprise companies need to be quite particular when vetting both agencies and internal teams as the ability to change direction will most likely not happen quickly. It’s also far more common in large businesses to split work more cleanly between teams simply for ease of management. For example, consider giving all your paid media management and SEO to agency partners, while you keep content development and email marketing in house…that kind of thing. Clear lines in the sand on who is doing what will make everyones’ lives easier.
No one can know your business as well as you do — so it’s all about making the right decision for you and your business. For all of these scenarios, having expert consultancy available to you from several places is never a bad idea. Two heads are better than one, and with multiple marketers analyzing your business and strategy…your campaigns are sure to be innovative and unique.
How can Marin help?
While we cannot make all your resourcing decisions for you, our expert solutions team is now bigger and more experienced than ever. This dynamic group of individuals work with our clients both with onboarding our software and providing guidance in a multitude of marketing dilemmas.
Our diverse group of marketers can manage your paid media optimization hands-on until you are ready to take the wheel or they can collaborate with both internal and external teams to provide additional insights. We will provide support and expert consultancy your in-house teams and agency partners will value to make positive paid media performance the driving force of your company growth.
As a global leader in digital marketing, and through long-standing publisher partnerships like LinkedIn, Meta, Apple, and more, we have the latest data regarding new campaign tactics and strategies.
Expanding as a company, facing hurdles or financial challenges, or simply not having the bandwidth to get everything done you would like to are all good reasons to explore our expert solutions services, in conjunction with our industry-leading software.