Hiring a marketing agency versus an in-house individual for your marketing needs involves a range of factors to consider. Both options have their own set of benefits and drawbacks. Here are some potential benefits of hiring a marketing agency over hiring an in-house individual:
- Expertise and Diverse Skill Set: Marketing agencies typically consist of professionals with diverse expertise, including digital marketing, content creation, graphic design, SEO, social media management, and more. When you hire an agency, you're gaining access to a team of specialists who can bring a wide range of skills to the table.
- Cost-Effectiveness: Hiring a marketing agency can often be more cost-effective than building an in-house marketing team. Agencies usually charge a fixed fee or retainer, which can be more predictable and manageable than the ongoing costs of hiring and maintaining full-time employees, including salaries, benefits, and overhead.
- Flexibility and Scalability: Marketing agencies offer flexibility in terms of scaling up or down based on your business needs. If you have a big campaign coming up, an agency can quickly allocate more resources. Conversely, during slower periods, you can scale back without the complexities of employee management.
- Access to Tools and Resources: Marketing agencies often have access to advanced marketing tools, analytics platforms, and resources that may be cost-prohibitive for individual businesses. This can lead to more sophisticated strategies and better insights into your marketing performance.
- Fresh Perspectives and Creativity: An external agency can bring a fresh perspective and creative ideas to your marketing efforts. Since they work with various clients across industries, they can introduce innovative approaches that might not have been considered within your organization.
- Time Savings: Working with a marketing agency can free up your time and your internal team's time. This allows you to focus on your core business functions while leaving the marketing tasks to the experts.
- Reduced Training and Onboarding: Hiring and training an in-house marketing team member can be time-consuming and costly. When you hire a marketing agency, you skip the training phase and immediately benefit from their established expertise.
- Objective Insights: An external agency can provide more objective insights into your marketing strategies and performance. Internal team members might have biases or become too close to the project to provide unbiased evaluations.
- Quick Access to Industry Trends: Marketing agencies stay up-to-date with the latest industry trends, algorithm changes, and best practices. They can help ensure your marketing efforts are aligned with current market conditions
- Risk Mitigation: If an individual employee leaves your company, you might experience disruption in your marketing efforts. With an agency, the risk of such disruptions is minimized because they have a team that can maintain continuity.
Hiring a marketing agency has many advantages
While hiring a marketing agency has its advantages, it's important to also consider potential downsides, such as less control over day-to-day activities, potential communication challenges, and the need to find an agency that truly understands and aligns with your business goals and values. The decision ultimately depends on your specific business needs, budget, and long-term marketing strategy.
What are the differences in cost?
The cost differences between hiring a marketing agency and hiring an in-house individual can vary widely based on factors such as the size of your business, the scope of your marketing needs, your industry, geographic location, and the level of expertise required. Here's a breakdown of the cost considerations for both options:
Marketing Agency Fees:
- Upfront Costs: Marketing agencies often charge an upfront fee or retainer to cover strategy development, planning, and initial setup. This can range from a few thousand dollars to tens of thousands, depending on the agency's reputation, the services offered, and the complexity of your marketing needs. According to a study by Agency Spotter, around 27% of marketers reported spending between $25,000 and $50,000 on their agency relationship setup. It is important to mention that at Two Trees PPC, we do not charge any set up fees. We incorporate all costs into our monthly marketing retainer, which we believe offers the best value in our industry.
- Ongoing Costs: The ongoing monthly or quarterly costs of working with a marketing agency can vary widely. They are typically based on factors such as the scope of services, the number of channels (e.g., social media, content creation, SEO) being managed, and the frequency of campaigns. Smaller agencies might charge around $2,500 to $5,000 per month, while larger or more specialized agencies could charge $10,000 or more.
- At Two Trees, we have implemented a comprehensive retainer model that offers three different levels to accommodate a wide range of scenarios. These retainer levels are designed to provide all the necessary resources for success and achieving your goals. The specific level is determined through initial consultations and tailored to meet your unique needs.
- Digital Advertising Costs: The cost of digital advertising campaigns managed by agencies can vary based on the platforms and ad spend. For example, a report from WordStream found that the average small business spends around $9,000 to $10,000 per month on Google Ads. This can either be paid by the agency on your behalf and then invoiced to you, or you can put your own credit card on
- Variable Costs: Some agencies also charge additional fees based on performance, such as a percentage of ad spend for digital advertising campaigns or bonuses tied to specific results.
In-House Employee Expenses:
- Salary, Benefits & Employment Taxes: Hiring an in-house marketing professional involves salary, benefits (healthcare, retirement contributions, etc.), paid time off, and other employment-related costs. Salaries can vary significantly based on the individual's experience, location, and job responsibilities. According to Glassdoor, the average salary for a mid-level marketing manager in the United States is around $75,000 to $90,000 per year. However, salaries can vary widely based on experience, location, and industry.
- Recruitment and Training Costs: Recruitment costs include job posting fees, interviewing expenses, and time spent by your HR team. Training costs might involve onboarding, professional development, and the time required for the new hire to become fully productive. The Society for Human Resource Management (SHRM) estimates that the cost of recruiting and training a new employee can range from 90% to 200% of the employee's annual salary.
- Equipment and Tools: In-house marketers may require equipment (e.g., computers, software licenses) and access to marketing tools and platforms, which can add to your overall costs.
- Overhead: Overhead costs, such as office space, utilities, and office supplies, contribute to the overall cost of maintaining an in-house team.
- Marketing Technology Costs: The cost of marketing tools and software can vary based on the tools needed. According to a report by Gartner, businesses typically allocate 26% of their marketing budget to marketing technology.
It's important to note that while hiring an in-house individual might initially seem like a more straightforward approach, the true cost can extend beyond the direct salary to encompass all the associated expenses. On the other hand, marketing agencies often provide a bundled service with a fixed cost, which can offer more predictability and potentially reduce the risk of unexpected expenses.
To determine which option is more cost-effective for your business, consider creating a detailed budget that takes into account all the factors mentioned above, as well as your specific marketing goals and the level of expertise required for success. It's also recommended to get quotes from different marketing agencies and compare them to the projected costs of hiring an in-house individual.
Remember, these figures are rough estimates and can vary significantly based on the specific circumstances of your business, the size of your marketing needs, your location, and the industry you're in. It's important to research current industry trends and obtain quotes from marketing agencies or salary data from your specific region to get a more accurate understanding of the costs involved in both hiring a marketing agency and building an in-house team.
What are the time savings between the two?
The time savings between hiring a marketing agency and building an in-house marketing team can vary based on factors such as the complexity of your marketing needs, the size of your business, the experience of your team members, and the level of coordination required. Here's a general overview of time savings associated with each option:
Marketing Agency Saves Time:
- Quick Setup: Marketing agencies are typically well-equipped to start working on your campaigns quickly. They have established processes and expertise in place, allowing them to hit the ground running without the need for lengthy onboarding.
- Expertise and Efficiency: Agencies often consist of specialized professionals who are experienced in various marketing disciplines. This expertise can lead to more efficient execution of campaigns and strategies, as they're already familiar with best practices and effective approaches.
- Resource Allocation: Agencies have the ability to allocate resources and manpower as needed. If a campaign requires more attention or additional team members, the agency can adapt quickly to meet your needs.
- Consistent Execution: Agencies are used to handling multiple clients simultaneously. This experience helps ensure that your marketing efforts remain consistent and well-executed, even during busy periods.
In-House Marketing Employee Takes Time:
- Onboarding Time: Hiring and onboarding new team members can take time. This includes recruitment, interviewing, training, and bringing them up to speed on your company's specific processes and culture.
- Learning Curve: New team members, especially those in junior roles, may need time to get familiar with your industry, target audience, and marketing tools. This learning curve can affect the speed and efficiency of their work
- Resource Constraints: In-house teams might face limitations in terms of resources and expertise. For instance, a smaller team might struggle to manage large-scale campaigns without hiring additional staff.
- Adaptation to Change: In-house teams might take longer to adapt to new trends, technologies, or changes in the market compared to external agencies that work with a variety of clients and industries.
In general, hiring a marketing agency can result in quicker turnaround times for campaign execution and strategy development due to their existing expertise and resources. On the other hand, building an in-house team might involve longer lead times due to recruitment, training, and the potential learning curve for new hires. However, once an in-house team is established and fully integrated into your company, their responsiveness and understanding of your brand might improve over time.
It's important to note that the time savings can vary based on the specific circumstances of your business. If speed and agility are critical, a marketing agency might be the better option. If you're looking for a more personalized and integrated approach, building an in-house team could be beneficial in the long run.
