Should I Hire a Marketing Manager or Outsource to an Agency?

This is the dilemma all businesses are faced with when they reach a certain level.

Marketing is a crucial part of the growth of every business. Whether you’re a small business trying to let the market know you exist or a large organisation trying to reach the peak of your industry, unless you have a clear and consistent marketing strategy there’s only one outcome for you.

Mediocrity.

No one wants to be a part of Mediocre Pty Ltd

There’s no excitement around your brand. No one begging to be apart of your dream. Staff turnover is high. Even your friends and family show little interest.

Mediocrity is for losers.

But effective marketing is not simple. Your competitors are always trying to gain ground on you. If you do the same things they’re doing, you’re just treading water.

Most business owners understand this, but very often they are too busy with day-to-day operations to formulate and implement an effective marketing strategy. They inevitably arrive at the same conclusion.

It’s time to get professional help.

But where to from here? Do I hire someone internally or outsource? What are the costs and benefits of each?

Of course, as the owner of a marketing agency you’d be right to be cautious about my opinion on this. But I will do my best to outline both options in an objective manner to present the best case for each.

OPTION 1: Hiring Internally.

Hiring internally can be a great option, particularly for companies with a long term focus. Having a Marketing Manager on staff and able to sit in on strategy meetings can be a huge asset to any company, and they will gain intimate knowledge of your brand and the wider industry. Even if they have no previous experience in your industry they should understand the buying cycle and how to identify those customers who will be responsible for the majority of your sales.

But an experienced Marketing Manager does not come cheap. According to Glassdoor, the average salary for a Marketing Manager in Australia is $108,262. This doesn’t include the business costs associated with recruitment, equipment, HR, workspace, software, superannuation, insurance, travel costs, the list goes on.. You also have to consider the high cost of replacing the Manager if they quit or are underperforming.

Assuming your Marketing Manager is a great fit for your company you will most likely run into another issue; a good Marketing Manager will not work without someone to take on the lower level tasks, particularly design-related tasks. They have already worked their way up the ladder and want to be pulling the strings. Don’t insult your Manager with mundane tasks that a graduate or assistant could do. This means you will also need to employ a Marketing Coordinator. The average pay for this position in Australia is $54,053. Sure, you could employ a student or graduate for a salary under $50,000 but you will need to factor in the extra training required for someone with little or no experience and the higher likelihood of them jumping ship (Millennials and Gen Z are far less loyal than Gen X and Baby Boomers).

A compromise would be to outsource the design related tasks to an agency or freelancer and have your Marketing Manager oversee this. But even this can end up costing more. An experienced freelancer will charge $100/hr, and an agency would charge more. You will need to determine just how much design and shitkicking is required to implement your marketing strategy and weigh up the higher hourly cost against that of a full-time or part-time Marketing Coordinator.

In short, hiring an internal marketing team is a great option if you can take on a $200,000 commitment (Manager+Coordinator all-in cost), have a strategy with enough work to fill the days of two full-time staff, with a 1-3 year marketing plan, an established brand with a consistent message and a robust HR framework and a continuity plan to handle any sudden loss of staff.

OPTION 2: Outsourcing to an Agency

Hiring a Marketing Agency to manage your brand and run your marketing campaigns avoids a lot of the downsides of hiring internally. The most obvious of these is cost. While an internal team can cost your company upwards of $200K, an agency could produce high quality effective campaigns and manage your brand for less than a quarter of the cost. Not only this, but an agency will most likely have a broader range of skills and talent at their disposal because they don’t just work on one brand. A good agency will have staff with specific skill sets and a network of contacts for those tasks that might require highly specialised skills.

An agency worth its salt will also avoid the trap of complacency. They know they are only one mistake away from losing a client, and should act accordingly. After all, changing marketing agencies is far easier than changing an internal marketing team. There are no employment contracts, no labour laws, no internal systems and no long term commitments. The agency will also be able to draw on the experience and knowledge gained from previous successful campaigns they have worked on with their other clients. Not only will they have many successes to draw on but they will also know the pitfalls to avoid. Once bitten, twice shy….

But hiring an agency may not be the best option for your company. If you have full time marketing requirements, hiring an agency will almost certainly cost you more than hiring internally. The agency will need to assign you a full-time Account/Client Manager and bring on their specialist staff for any tasks the Account Manager doesn’t have the skills or knowledge for. You won’t have oversight of the staff and you won’t know if they’re actually working full time on your account or just playing foosball and mini golf in their stupid rec room. The efficiencies and advantages enjoyed by an agency will be completely negated if the agency charges you triple what their staff costs them.

Another example where hiring an agency doesn’t make sense is when your company operates in a unique industry that requires specialist knowledge of the market. Most Marketing Agencies will have expert knowledge of consumer behaviour and will know how to market products or services to a general audience, but if you have a customer base that does not come to you using the common media platforms, you will need a Marketing Manager who knows your industry and knows where to find your potential customers.

In summary, outsourcing your brand management to an agency is the right option if you want a marketing team without the financial and human costs associated with hiring internally. An agency can be a wealth of knowledge and offer an outsider's perspective at a fraction of the cost of hiring internally. However, outsourcing will not be the best option for companies with daily marketing requirements or specialised industry knowledge. If this is your company, you’ll be much better off biting the bullet and hiring a Marketing Manager with the right experience.

So there you have it, the cases for and against hiring a Marketing Manager and outsourcing to a Marketing Agency. There are multiple quantitative factors to consider before deciding which route to take and I didn’t even touch on the qualitative factors that will impact your bottom line. Maybe I will in the next post, maybe not. Remember that marketing should always be a positive ROI in any given year. If you’re not achieving that, perhaps it’s time to rethink your strategy.

And here comes the plug….. (couldn’t help myself)

If you’re unsure about how an agency like ours can add value, you can get in touch with us at hello@splashandcocreative.com.au or fill out the enquiry form. We don’t take on clients unless we strongly believe we can deliver a positive ROI within 3 months.