Everyone thinks they’re a natural born marketer. Most businesspeople, executives and almost all entrepreneurs think they know how to sell their product or service better than anyone else. And while there’s no doubt that we are much more media and marketing savvy than ever before, the reality is that there is a genuine shortage of marketing experts capable of getting brands the attention they need in an intensely competitive, constantly evolving digital landscape.
Most companies seriously consider outsourcing tasks when functions or tasks require a)
considerable technical expertise and experience that is either expensive or in short supply; b) repetitive or complex business processes often in need of capital investment; and c) performance –based compensation tied to service level agreements, which are almost impossible to extract from employees. Using these criteria many businesses should consider outsourcing all or part of the marketing function.
The numbers of marketing professionals -- who can figure out how to define, differentiate and drive traffic for your product or service – or who can cost-effectively zero-in on the people most likely to buy from you is in short supply. Many of the best ones are already spoken for and many of the candidates in the market have been haphazardly trained or are the beneficiaries of rampant title inflation, which characterized the first Web bubble and is driving Web 2.0.
Knowing how to Google isn’t enough. Critical marketing functions like demand generation, viral marketing, experiments in social networking and online communities and search engine marketing are a complex mixture of art and science requiring experience, technology and media savvy. You can’t fake it. And learning on the job is expensive and often counterproductive. For these and other important discrete marketing tasks, outsourcing is often the most efficient and cost effective alternative.
Motivating employees, who are not salespeople, to meet performance benchmarks and compensating them on the basis of performance is almost impossible. Many businesses use outsourcing as much to finesse internal politics and structural silos as to accomplish specific tasks or meet specific financial or sales objectives because you can buy expertise on-demand, parse marketing spending and in some instances find outsourcers who will share both the risk and the rewards.
By outsourcing marketing you trade-off the illusion of control and the comfort of having a warm body at hand to receive your spontaneous enthusiasms, ideas and insights. Yet many outsourcers will put a staff member on your premises and given the widespread use of technology you can easily communicate an idea or an inspiration by voice or text around the corner or around the world in a nanosecond.
Outsourcing often gets you much more for the money. Hiring a hundred thousand dollar per year Marketing Director gets you a mid-career professional with a mixed bag of skills and an overhead burden of 40-50%. Spending the same money with an outsourcer, you get a team of players ranging from a senior counselor to a very junior schlepper who may be better suited to think through, structure, create and practically manage the full range of marketing and communication tasks you need to accomplish.
Danny - ran across your blog and had to comment... your post about outsourcing marketing was thought provoking, but incomplete. your point about skills is valid, but your cost analysis couldn't be more offbase. if i outsource my marketing for $150k (base plus overhead), i might get a team of smart folks, but that cost only gets me maybe 3-4 mos. of work. if i am somehow able to negotiate an annual agreement for that cost, they are most likely not dedicated to my account; agencies are not structured to support that kind of overhead.
i know, i went down the outsourcing road with a $50B fortune 500 company with very mixed results - and with a top shelf, highly regarded marketing firm. companies are better suited to outsource either specialist roles with specific skills - such as SAS programmers, DBAs, or hard core data plumbers - or lower-level, mindless tasks. Instead, companies need to insource the strategic thinking, analysis, and insight. if i am outsourcing program development, decile definition, or test plots, my company is focused on insourcing the wrong functions. i would rather pay for the intelligence and outsource the rote tasks.
Posted by: B.Mayberry | May 10, 2007 at 07:21 PM
You can outsource execution, but you can't outsource strategy or accountability.
If you can't afford a top marketing person, as an entrepreneur, you should learn to do it on your own.
Posted by: Chris Yeh | June 22, 2009 at 09:13 PM