The Hidden Risks of In-housing

In-housing or outsourcing? It’s one of the biggest questions in marketing and more brands are discussing whether to hire in-house employees or to outsource marketing work to digital marketing agencies.

Outsourcing has been growing through the years, shaping how brands market their products or services to capture the biggest market share and grow internationally. It allowed companies to expand to different markets they knew nothing about in a very short time. Also, gave them access to international talents under the agency umbrella. The growth of specialized agencies, especially for mobile apps, speaks for itself.

However, CEOs still struggle to find what they are looking for and look for hiring in-house or reducing their reliance on external agencies. This is driven by the idea that founders believe they will be able to maximize their business growth if they took everything in-house as this is supposed to give you full control of every corner of marketing operations, save money and maximize your team’s skill sets. But there are hidden risks and costs to this approach that don’t seem obvious at first.

There are many approaches to this, and it also depends on factors like the growth stage, size and cash-flow, how ambitious the growth goals are, growing locally or internationally, and many more. Whichever way a company decides to run their marketing (fully in-house; agency now, in-house later; or even outsourcing everything), the decision should be weighed against more factors than comparing price tags or hourly rates of employee vs. agency.

Other hidden risks of in-housing

Hiring employees in-house may seem like a great idea with so many benefits, and the one every founder talks about is that your in-house employee will dedicate work and interest 100% to the business, which should help you reach your goals. However, in-housing comes with many hidden risks and cons that are hardly talked about. Here are the top ones:

Time-finding talents

Finding talent is hard and eats a lot of your time. Depending on the state of your company you may need to invest time in job descriptions, posting on recruiting portals, screening first applications which can easily be hundreds of profiles to be reviewed, scheduling interviews, maybe second and third interviews with case studies involved (it’s recommended to prepare some nice case study to challenge your candidates on practical work and creative thinking around solutions), etc. On the other hand, when you are using an agency they take on the risk that the candidate is a fit and they can focus their time on their one specific job which makes them more productive. There’s nothing better than having a team of people who can work on a project in full force with minimal ramp-up time, right? Above that comes the idea of collaboration and building a good communication culture. If your project has more than one person working on it, using in-house employees will need a collaboration manifesto and culture-building efforts, which means more time and resources.

Lack of focus on the product

Especially for startups who build something new – focusing on the product is key. Marketing is only one piece of the puzzle, albeit an important one. But it can be a huge distraction with its hundreds of details and questions like attribution, tracking, or channel-specific requirements. A good agency will know about all of these. Whereas your in-house team will have to learn and keep up to date on all of it. Which will be increasingly difficult with each new channel.

One of the top if not the top-secret behind the great success of the majority of startups is
the fact that they focus on building the right product, not just by coding or programming it but by surveying their customers, finding the pain points, introducing solutions, and finding the product-market fit. The more time and focus they can spend on this, the higher their chances of building a successful product.

Financial risk

Hiring employees in-house comes with financial responsibility. If you are not careful, you can find yourself overwhelming your business with so much responsibility. That can hold you back from growth or success.

Hiring an in-house marketing team is beyond hiring one person as you will need to hire enough people to cover growth, data, advertising, and creatives. This means a Growth Lead, Performance Marketing Manager, Senior Data Analyst, and Creative Director. Then, each of those individuals will need another 2-3 employees to create their own teams.

So, before you make the decision to hire an in-house employee, you should understand how to afford it and how it will impact your business if that employee isn’t the right fit for you. Making these mistakes will cost your business its most valuable assets. Its monetary and time resources.

Lack of experience

As a business owner, you want to avoid common pitfalls and make the right decisions as often as possible. Hiring an agency means you get access to a jar full of mistakes and learnings. That your business will automatically get access to and use to grow.

Agency life is a grab bag of cool experiences and valuable learnings from just about every project agencies worked on. There is so much expertise and experience that probably you will lose in the shuffle when you go the in-house route.

In addition to that, agencies have access to much more data that will help in understanding the market, the trend, and putting actual benchmarks for performance.

In-housing or outsourcing: Conclusion

Hiring a marketing agency will benefit your business in so many ways. It will help you grow your business and sales by focusing on your product and customers. While the agency takes care of the heavy lifting in marketing for you.

Here are some of the benefits;

• Marketing agencies are cost-efficient and will take a lot of the risk-off of your business
• You get access to a comprehensive team that’s ready to get their hands dirty doing the job very quickly
• Automatic access to all their learnings and data across different industries and regions
• Your marketing efforts will be fueled with automation and bleeding-edge technology/tools

Hiring employees could seem to be a safer option that will help your business. But there will be so many hidden risks that will slow down your business. As well as prevent you from allocating your resources the right way.

That’s it for this one, see you in the next article. Ciao!