In-House Marketing vs Agency: Which Is Best for Your Business?
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What is In-House Marketing?
In-house marketing deploys all marketing tasks to an internal marketing team.
Internal marketing teams handle every aspect of a marketing campaign. This includes marketing initiatives to increase brand awareness.
An in-house marketing team is composed of varying roles. Here’s a typical structure of in-house marketing teams:
- Marketing manager or director: Oversees the whole in-house marketing team. Aligns marketing strategies with the company’s vision.
- Brand manager: Leads the branding direction of the company. Ensures branding consistency across all marketing efforts.
- Section managers: Includes managers in digital marketing, content marketing, and social media.
- Creative director: Oversees marketing visuals and messaging. Supervises a team of creatives.
- Creative team: Composed of graphic artists, copywriters, and photographers. Follows the creative director in aligning branding with visuals.
An in-house team also employs marketing analysts or consultants. They play a big role in aligning marketing campaigns to industry benchmarks.
What is a Marketing Agency?
A marketing agency is an external team of marketing specialists and experts.
They develop marketing strategies for other businesses or organizations. Marketing agency teams work independently in terms of manpower and location.
There are many benefits to hiring a digital marketing agency. Typically, an external marketing agency offers a full suite of services. A full-service agency can help you in these areas:
- Market research: Focuses on research around your target audience. This includes analysis of marketing trends and competitor movements.
- Public relations (PR): Establishes connections with journalists and bloggers. Improves your brand reputation in the industry.
- Digital marketing: Develop a digital marketing strategy for your business. This covers social media, search engines, email, and PPC advertising.
- Brand development: Creates a branding that fits your vision. Ensures brand familiarity across marketing channels.
- Creative services: Provides creative direction for your marketing campaign. This includes graphics, copywriting, and website development.
Marketing agencies also monitor the progress of marketing processes. They use innovative tools to optimize your every marketing activity.
In-House vs. Agency: Cost
Costs are the number one point of comparison when deciding between marketing agency vs in-house team.
In-house cost
Among B2B businesses in the United States, 38% have in-house marketers. It’s safe to say that doing marketing in-house is not for everyone.
For businesses, their number one consideration is the expenses. The costs could vary for business, depending on size and nature. Here’s how businesses allocate their budget to an in-house team.
The estimated costs are calculated on annual reference unless otherwise stated.
Salaries for marketing staff:
- Marketing director: $180,000 – $275,000
- Brand manager: $110,000 – $170,000
- Digital marketing specialist: $60,000 – $100,000
- Social media manager: $55,000 – $75,000
- Content marketing manager: $80,000 – $110,000
- Creative director: $110,000 – $140,000
- Marketing analyst: $70,000 – $100,000
- Graphic artist: $50,000 – $75,000
- Copywriter: $40,000 – $70,000
Benefits, training, and development expenses:
- Benefits: These include health insurance, performance bonuses, and other perks. For example, health insurance per employee could cost up to $7,000 annually.
- Training: It’s recommended to invest in employee training and development. This covers upskilling courses and industry conferences. On average, training could cost between $1,000 – $3,000 per employee.
Overhead costs:
- Office space: You might need 2,000 square feet of space for 10-15 employees. Office space could cost between $80-$120 per square foot.
- Digital tools: You need access to digital marketing platforms. Team subscriptions could cost between $8,000-$10,000 annually.
Agency cost
The number of ad agencies continues to increase every year. In 2024, there are 433,000 marketing agencies worldwide. That’s a 2.6% increase compared to 2023.
Flexible pricing models are a benefit of agency marketing. A digital marketing agency typically offers these pricing models:
- Monthly retainer: Requires fixed monthly fees. There’s an agreed-upon set of services each month. Typically, marketing agencies charge a minimum of $3,000 for monthly retainers.
- Project-based: Requires corresponding fees for each project. This is perfect for small to medium-sized businesses. The fees depend on the complexity of the project. For example, a web development project could start at $4,000.
- Performance-based: Fees are based on the performance of the marketing strategy. This gives clients assurance in terms of value. For instance, fees could increase based on website traffic or conversion rates.
- Hourly rate: Requires hourly rates for the services of an external agency. This is typically used for marketing consultation projects. Hourly rates could cost between $75 to $120.
Marketing agencies can maximize your marketing investment. That’s particularly true if you choose the pricing model that fits your marketing needs.
In-House vs. Agency: Effectiveness
The process of achieving goals differs between an in-house team and a digital marketing agency.
In-house effectiveness
Naturally, an in-house team has deeper familiarity with the business. That’s a significant advantage for an in-house marketing team. Aligning marketing strategies is easier for an in-house team.
Doing digital marketing in-house could be more effective in several cases. Here are the reasons why:
- Familiarity: They know the company from the inside and out. An in-house marketing team is instilled with the company’s values. That could be reflected in the marketing strategy they employ.
- Decision-making: It’s easier to make the right decision, branding-wise. Again, the marketing department knows the company’s culture. There’s no trouble deciding which action to take.
- Consistency: In-house teams can easily centralize their branding strategies. Consistency is easier to attain for internal teams.
Agency effectiveness
A marketing agency achieves goals through a different approach. In-house teams focus on aligning strategies with company branding. On the other hand, marketing agencies focus on industry trends and benchmarks.
Of course, agency teams still align with company goals. However, the fresh ideas they bring to the table are game-changing. Here’s why many businesses trust an agency team:
- Specialized expertise: Agencies have specialized experts in each area. That’s an advantage of agency marketing. Clients don’t need to invest in staff training and development.
- Industry experience: Choose a digital marketing agency relevant to your niche. Agencies should have experience working with multiple clients in your industry. Check their client testimonials and reviews.
- Innovation: Agencies spend lots of time immersed in market trends. They attend industry conferences, workshops, and expos. This equips them with innovative ideas to offer to potential customers.
In-House vs. Agency: Tools and Technology
Marketing agencies and in-house teams utilize digital tools in executing a marketing campaign.
In-house tools and technology
Companies allocate a marketing budget for digital tools and technology. It’s almost impossible to execute a business strategy without these tools.
However, there are some reservations about in-house marketing. It’s a significant investment, particularly for these two reasons:
- Costs: Digital tools aren’t a one-off purchase. These days, most platforms require monthly or annual fees.
- Limitations: Staff should be trained in handling tools. Limited technical expertise could hinder a tool’s optimum capability.
This isn’t a problem if your staff has expertise in manipulating tools. But if not, you’re also spending bucks on their technology training. That could be a deal-breaker for businesses with limited resources.
Agency tools and technology
Agencies already have a broad range of tools at their disposal. They invest a lot in technology. Remember, they utilize these tools for other clients as well.
If you’re hiring a digital marketing agency, evaluate the tools they have. Their access to cutting-edge technology will further maximize your investment. The right digital marketing agency should have tools that address your needs.
Also, consider these points when evaluating their technology expertise:
- No direct costs: Look for agencies that don’t charge for tool subscriptions. Again, they should already have these at their disposal.
- Beta access: Agencies shouldn’t have any trouble accessing beta features. Digital platforms usually provide beta access to reputable agencies.
One advantage of team agency is cost-effectiveness. Agencies already have subscriptions to tools that you need. This ultimately cuts back on your costs and expenses.
In-House vs. Agency: Flexibility and Scalability
Handling varying amounts of tasks is another consideration for choosing a marketing team.
In-house flexibility
Marketing is among the Top 10 industries with the highest employee burnout rates. How much workload can your team handle? Can they manage sudden surges in tasks?
Companies pay attention to workloads, especially internal marketing teams. However, there’s not much leeway to work with.
Many businesses struggle with project management. Here’s why:
- Limited skill set of a smaller marketing team
- Difficulties in handling big orders
- Potential for burnout and heavy stress
Stress can lead to decreased productivity for a team. Quick scaling then becomes a huge challenge for a business.
Agency flexibility
In-house marketing still has the advantage of company culture awareness. However, there will come a time when you need to scale quickly.
That’s where agency marketing enters the picture. They have the manpower and tools for quick scalability. Here’s how they do it:
- Adequate manpower for quick scalability
- Flexibility to scale down if requested
- Ability to work on multiple projects at the same time
Scalability is a top reason why businesses tap into agency work. As external partners, they can easily adapt to your needs. Just ensure that they don’t regress in terms of product quality.
In-House vs. Agency: Control and Collaboration
Businesses like to have complete control, whether they opt for internal or external teams.
In-house control
Direct communication is the top benefit of internal teams. There’s little leeway for any miscommunication.
Moreover, companies can have total control over all activities. They could secure all company data and strategies. After all, data confidentiality is one of the industry best practices.
Here’s why businesses love the control aspect of internal teams:
- Total control over marketing decisions and processes
- Direct interdepartmental collaboration and communication
- Full confidentiality of company information and data
Companies become vulnerable to risks when conducting business online. Having internal teams can mitigate these risks.
Agency control
Working with marketing agencies is not all nice and good. There are still a few drawbacks, particularly in communication.
Typically, agencies work independently. They have their own office space and they work on their own terms. This setup could be a barrier to communication.
Working with agencies could lead to control issues like these:
- Cannot oversee day-to-day marketing activities
- Less say on the entire marketing strategy playbook
- Potential delays and barriers to communication
- Increased need for goal alignment meetings
The positive side is you don’t have to micromanage anymore. However, there should be clear communication, especially on company branding. You want a unique business that can effectively compete in the market.
In-House vs. Agency: Innovation and Creativity
Creativity and innovation play big roles in choosing a marketing approach.
In-house innovation
Stagnation is a real problem for internal marketing departments. Here’s why:
- Limited perspectives on different marketing sectors
- Repetitive campaigns that could tire your audience
- Missed opportunities to leverage market trends
Take, for example, social media marketing. This is a marketing channel that’s defined by evolving trends. Your internal team should know innovative strategies in social media management.
For instance, influencer marketing is important in current digital campaigns. But there are specific tactics for collaborating with influencers. That’s something that agencies are expected to be experts in.
Agency innovation
Marketing and advertising agencies are creatives in their own right. Their selling point is centered on fresh, industry-specific solutions.
Here’s how agencies integrate marketing innovations:
- Maximizing powerful capabilities of marketing tools
- Direct access to a wide range of creatives and specialists
- Ability to effectively launch paid ads campaigns like Google Ads
- Inside information on the latest industry-specific technology news
Agencies can turn “traditional” strategies into innovative ones. Email marketing is a good example. They launch dynamic campaigns by integrating target keywords and strong hooks.
When to Choose In-House Marketing Teams
There are pros and cons in choosing in-house marketing teams. Take a look:
Pros:
- Direct communication and quicker decision-making
- Total control of the marketing playbook
- Increased employee trust and satisfaction
- Ability to secure confidential data and information
- Perfect for companies with enormous budgets for a marketing department
Cons:
- Increased potential for burnout and stress
- Challenges in scaling workloads
- Limited expertise and innovations
- Difficulties in keeping up with market trends
Moreover, this setup allows the team to grow with the company. Aligning strategies with business goals becomes natural in the workplace.
When to Choose a Marketing Agency
Outsourcing marketing tasks to agencies is prevalent nowadays. The scalability potential is there, although it has several drawbacks, too.
Pros:
- Quick scalability potential
- Ability to focus on other aspects of the business
- Availability of flexible, value-based pricing models
- Access to specialized marketing expertise
- Access to digital tools and platforms
- Perfect for companies aiming for sustainable growth
Cons:
- Significantly less control over marketing activities
- Challenges in goal alignment and branding consistency
- Higher costs for full-suite services
Remember, working with an agency is a long-term partnership. Onboarding is expensive and stressful. You don’t want to change agencies from time to time.
It’s important to choose an agency that fits your needs. For example, marketing agencies like Fortis Media offer niche services. These agencies have experience working in very specific industries.
Hybrid Approach: Combining In-House and Digital Marketing Agencies
Are you having a hard time deciding which approach to take? Try combining internal and external marketing teams.
A hybrid approach gets you the best of both worlds. It’s cost-efficient and scalable at the same time. We recommend these tips for integrating both marketing approaches:
- Provide clear responsibilities. You don’t want conflicts on varying workloads or hierarchy. Ensure that each party knows and agrees to their role.
- Lay out clear instructions on communication channels. Each party should know who to talk to regarding particular matters.
- Monitor the performance of each team. Evaluate the costs against the results.
Most importantly, instill a culture of collaboration. This helps guarantee a shared path towards achieving your business vision.
Key Takeaways
Don’t force yourself to immediately choose between in-house marketing and agencies. The effectiveness of each approach depends on numerous factors. Your business direction is one.
Assess your short and long-term goals. Gauge the amount of resources you can allocate for marketing purposes. Evaluate your aspirations for scaling and growing your business.
Choosing between in-house and agency marketing requires a careful approach. Know the ins and outs of your business first. Then, the decision becomes easier.
FAQs
What are the key differences between in-house marketing and agency services?
In-house marketing teams and agency services differ in costs, expertise, flexibility, and communication channels. It’s easier to communicate within internal teams, but external agencies bring a new level of innovation and ideas. Choosing between the two marketing approaches depends on your business goals.
How do costs compare between in-house marketing and using an agency?
Using a marketing agency requires significant upfront costs, while managing an internal team requires long-term, ongoing expenses. Doing marketing internally requires spending on employee salaries and training, office space, and software. Whereas the costs of using agencies could depend on flexible pricing models.
Can small businesses benefit more from in-house teams or agencies?
In terms of scalability and growth, small businesses can benefit more from marketing agencies. However, running an internal team offers direct control of the marketing process, along with easier communication between different departments. There’s no one-off answer to this question, as it depends on the company’s goals.
What are the main advantages of a hybrid marketing approach?
Combining both internal and agency resources enhances project flexibility, cost efficiency, and expertise. You gain fresh perspectives from an agency, which your internal staff can learn and apply. Moreover, you have better control of the marketing process, compared to letting agencies have total control of the activities.
How do I decide whether to hire an in-house team or an agency?
Choosing between in-house marketing teams or agencies depends on your budget, nature of projects, deadlines, and scalability goals. You also consider the current skill set of your internal staff, especially when you deal with multiple clients. Moreover, factor in how you can best keep up with the competition.
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