I read a book recently that said: “No matter how talented your employees are, chances are that most of them are becoming obsolete and uncompetitive right before your eyes.”
The book is called Exponential Organizations: Why New Organizations are Ten Times Better, Faster, and Cheaper than Yours, and the author, Salim Ismail, talks about what makes a company like Airbnb or Uber experience 10X growth while others lag behind. The secret to success? Exponential Organisations (ExOs) outsource many business functions, with just a core of full-time staff that handle essential operations.
It got me thinking: why don’t more companies outsource their digital marketing? Because I’ve seen the following scenario happen too many times:
A company decides to insource their digital marketing because it’s perceived to be more cost-effective compared to an agency. They hire an ex-agency person, usually someone young and up-and-coming, and that person quickly becomes enmeshed with the business. But they don’t have anyone to steer them, like a senior manager or digital partner, and they quickly lose touch with trends – they become obsolete before your eyes.
I’ll say it upfront: insourcing isn’t necessarily a bad thing. It enables faster speed to market and closer alignment with the business’s objectives – because the people involved are inside the business. But outsourcing allows specialists – who are outside of the organisation and more subjective – to take the reins and stay on top of best practices so that decision-makers can focus on the business itself.
The link between office space and outsourcing
It’s a bit like having your own offices versus a flexible workspace. Hear me out.
Pre-Covid, it was important to have your own offices. It gave a business credibility and having the right address gave prestige. But I've realised that having my own office came with a million distractions: instead of being focused on running the business, I’d have to worry about whether the vacuum cleaner was working, if there was enough diesel in the generator, or when I’d find the time to call contractors to fix the aircon.
Sure, it's more expensive to pay for someone else to service your offices, but then it removes the distractions. I’ve also come to realise that flexible, shared workspaces are even better – they’re cheaper and come with minimal headaches.
Like flexible office space, outsourcing digital marketing is often the right call. Not only do companies usually pay 30 percent more with an in-house digital marketing strategy (read that stat again), but if they partner up with an agency that’s client-centred and has the right talent, the benefits multiply.
A good agency focuses on continuously learning. That’s why Firewater’s motto is #AlwaysLearning; it’s part of our DNA to be on top of best digital marketing practices and trends. I’ve seen many companies insource with ex-agency people – which is great because they have that agency experience. But when they’re removed from the learning environment, they can become ring-fenced and tend to develop tunnel vision in that business.
If you're going to insource anything, make it your community management. Because you can respond to customers quickly and you have internal knowledge; having someone in-house gives a clear and immediate sense of what's going on.
The challenge will be maintaining skills, staying on top of trends, and managing these specialised resources. So, in-house, there will be isolated learnings: for example, if you’re in the coffee bean business, you don't know what else is happening in different industries because that's all you're exposed to.
An in-house resource will become immersed in the business – but they can also become lost in it.
A jack of all trades, and a master of none
A common pitfall with insourcing is that the digital marketing person often gets tasked with anything remotely related to marketing. It’s strategy today, designing flyers tomorrow, organising merchandising the next. That's a big mistake; they become a jack of all trades and a master of none.
Agencies have specialists: creative, copy, strategy, project management, ad management, social. An agency is also paid as a supplier, so it’s not your problem when one of the resources goes on leave, and if a resource quits, there’s continuity as there’s no need for recruitment.
An agency works in a team; a team of one loses that sharing of knowledge and collaboration, and an agency doesn’t operate in a silo. Creative works with copy, the strategist works with the backend developer, and the project manager works with the account manager.
An agency will provide content plans and deadlines, and you can hold them accountable. They also look at things more objectively: we can put on different hats to understand what your business really needs. The best part? Outsourcing allows a business to scale their digital marketing efforts up or down, when and where it’s needed.
Don’t get me wrong, an insourced team for day-to-day digital marketing is fine: it'll give you speed to market and some cost-efficiencies. But you still need someone to drive the strategy.
Get the best of both worlds
If your business only outsources one thing, make it your digital marketing strategy. An agency can guide your internal team and help uncover opportunities through audits, measurement, and insights. A hybrid model – like hybrid work – makes sense in some cases. Every month, the agency can pull reports on what the internal team has done and adjust where needed. An agency can guide you in the right direction so that the business gets the best of both worlds.
Whether hybrid or outsourced, digital marketing shouldn't be a grudge purchase – it can unlock opportunities, generate leads, and drive growth. Yet, a 2020 Forrester report predicted that U.S. marketing spend would be 28 percent lower this year than in 2019 – and that’s their “optimistic” projection. The same report found that digital marketing strategy services would be three percent lower in 2023.
These numbers are for the U.S., but I’ve seen similar trends in South Africa and Australia – the main markets that Firewater operates in. If anything, budgets should be increased in channels where every cent can be tracked – like digital. With more legroom, businesses can get more serious about their digital marketing – and take on a completely outsourced or a hybrid approach.
Covid-19 has undoubtedly changed how businesses operate. And some have found that it's better to completely outsource certain functions, from the servicing of their offices to digital marketing, so they can minimise distraction and focus on what’s most important – staying ahead of competitors, innovating, and let’s not lie, making money.
Want to see what outsourced or hybrid digital marketing can do for your business? Get in touch; we can guide you to 10X your efforts.