Lately, I’ve been hearing more and more small to medium-sized business owners expressing an interest in bringing their online marketing efforts in-house. In this article, I’d like to explore this issue in an effort to provide clarity for anyone struggling with this decision.
Disclaimer: While there will always be exceptions to the rule, this article is geared to the average small to medium-sized business and is not applicable for enterprise-level players.
Here are the three typical beliefs that drive a business to bring their online marketing in-house:
- They believe they can reduce costs.
- They think they can gain more control.
- They don’t trust that an online marketing agency will deliver on their promises.
On the surface, these all seem like reasonable statements. But, let me share some industry insider insight (say THAT three times fast!) that might provide you with a valuable perspective.
First, in order to provide context, let’s set some premises up front. I promise it will all come together at the end of this article like a beautiful fireworks finale.
Let’s Slay the Unicorn
Before we dive into this fascinating subject, we need to the address the Unicorn in the room.
In the online marketing world, someone who is an online marketing generalist and is an expert in all three of the main disciplines of online marketing (SEO, paid media (PPC), and social media), is called a “Unicorn.”
Why? Very simple: Unicorns don’t exist.
Nobody could possibly keep up with all of the constantly changing algorithms, targeting methodologies, tools, techniques and nuances across all the different disciplines and channels that make up the full online marketing spectrum. It would be impossible.
Many business owners have dabbled in Adwords and think; “how tough could it be?” But, Adwords is just one of the many paid channels nowadays and not necessarily the most effective. Trust me, this stuff is getting incredibly complex.
If you’re one of those business owners or marketing executives who is thinking of hiring a single jack-of-all-trades marketer to run your SEO, do your PPC, post on Facebook, manage your website and pick your kid up from band camp, I have bad news for you. You’re in for a mediocre ride at best.
Quality Means Quantity (and lower cost)
After 20 years in the online marketing industry, I can tell you one thing for sure – A passionate, highly-skilled, QUALITY online marketer generates exponentially higher rates of return on investment than a run-of-the-mill practitioner. Over the last 10 years, a large part of my job was to source and hire exceptional digital marketers. What I learned shocked me, but accepting the reality of the situation was also the secret to the success of my Google Premier Partner agency.
The truth of the matter is: Hiring exceptional online marketing talent is hard – REALLY hard! After in-depth interviews and highly advanced skills testing of countless prospective marketers with really impressive-looking resumes, we found that only about one out of every forty candidates actually knew what they were doing and had a skill level that my team and I found acceptable.
All of those candidates invariably thought they were online marketing geniuses, and to the average business owner or marketing executive, it may seem that they are. The problem is you can’t know what they don’t know and typically you don’t find out until it’s too late. I often ask business owners: “Would you know how to hire a rocket scientist?” The answer is invariably “Of course not”. So what makes hiring an online marketer any different?
An exceptional, “high quality” online marketer, generates a MUCH higher “quantity” of conversions at a lower cost of acquisition than a run-of-the-mill person. And, these exceptional online marketers are almost as rare as unicorns, especially in paid media (PPC). But trust me, you want to hire the brilliant ones, and not the run-of-the-mill.
Consider this: If you were building an in-house team, would you be able to tell the difference between the exceptional and the mediocre candidate? Remember, their resumes will all make them look like superstars (they are marketers after-all). In my experience, it takes an exceptional marketer to know the difference. This is where many in-house teams fail. If the person doing the hiring can’t separate the wheat from the chaff, you’re headed for mediocrity or worse, failure.
In-house Online Marketing vs Agency – the Bubble vs the Star Incubator
Brilliant online marketers, just like real stars, are born and nurtured in an incubator, not in a bubble. In the agency world, a bright millennial is surrounded by other brilliant young minds, all feeding off of each other. Within a good agency team, there is collaboration, a diversity of thought and an innate competitiveness. Additionally, at an agency, these stars-in-the-making are exposed to a variety of business types and the unique challenges of each different vertical. When one ingenious team member discovers a new successful tactic that works in one business type, they share it with their team and that tactic can now be modified, adapted and applied to other types of businesses.
The motivation of an exceptional online marketer is driven by a desire to grow. They value life/work balance. They want to be respected and appreciated. They have an unquenchable thirst for knowledge. They also don’t want to be the smartest person in the room. My agency attracted brilliant young people from all over the country for one major reason: We had people that prospective employees recognized as highly-skilled and the most exceptional job candidates want to be part of a progressive group where they can learn, grow and be challenged. This is what makes exceptional online marketers the highly sought after conversion machines they are.
Bursting Your Bubble
The people you want doing your online marketing, the exceptional ones, are looking to surround themselves with others of their kind. Even if you could entice one of these stars into joining your company, you’re offering them a bubble – typically one where they are the smartest one in the room and one in which they will cease to grow. Most will probably lose their edge and become bored and complacent.
In my experience, it’s typically the lazy ones who take in-house jobs, the ones that don’t enjoy competition, don’t want to be challenged by their peers or have to try too hard. I know that sounds harsh and, while there are exceptions to that rule, that is the unfortunate norm. These mediocre digital marketers build a resume, then search out a cushy in-house opportunity where they can convince you they are the kings and queens of online marketing, with no one to really challenge their prowess.
Think about it. If what I’ve just said is true, how likely do you think it is that you’ll be able to attract the type of online marketer who can provide you with the kind of exceptional results your business deserves? And, isn’t that really your goal? To spend your online marketing budget as effectively and efficiently as humanly possible?
So at this point, you’re probably saying to yourself: “It sounds like this guy is saying we shouldn’t hire an in-house team.”
You’re absolutely right. I rarely recommend hiring in-house online marketers.
Please keep in mind, I sold my agency in 2017 so I have nothing to gain from my position on this issue. I just want what’s best for you and your company. In fact one of the services my current firm provides is vetting of candidates for in-house teams, So, it’s not that I don’t see the value in being in-house. I do, but only when it makes sense. Keep reading and I’ll share my thoughts on when it would be in your best interest to hire in-house. And for the rest of you, I’ll shine a light on the path forward.
When Should I Consider Hiring In-house Online Marketers?
To best answer this question, let’s look at the three main disciplines independently:
A qualified search engine optimization professional is rare and expensive and believe me, they know their value. Salaries for this level of hire run between $60k and $70k per year, while the exceptional SEO people command into the six figures. At $70k per year for that one person, you’re already spending $6k per month before you even start adding in the other costs of employment like insurance, benefits, office space, overhead, vacations etc.
For the average SMB, the cost of hiring an exceptional agency that puts a full team of technical SEO, local SEO and content writers to work for you can run anywhere from $4k a month on up. But, the sweet spot for most small businesses using an exceptional agency is $5k to $10k per month. Unfortunately, the crappy agencies can charge that much too, so you can’t gauge quality by their price. We’ll talk about how to tell the difference in a moment.
The only time I’d suggest an in-house SEO person would be if SEO is the only online channel that makes sense for your business and that same person has coding and graphics skills so they can also manage your website. Many times these particular skills do come packaged together. But that person also needs to be an accomplished writer. Many SEO specialists are becoming skilled writers, as a large part of the modern SEO play is content. However, it’s rare to find one person who has SEO, coding, graphics AND writing skills. So be careful.
On the flip side, an exceptional boutique agency will put a team of individuals to work for you at a similar price point. Ultimately, they will provide greater value and fewer headaches than taking the risks of hiring someone in-house.
Paid Media / PPC:
By far, paid media is the most complex area of online marketing. Remember, it’s not just Adwords anymore. These days it’s DSPs, programmatic media buying, paid social and machine learning targeting solutions. Paid media is also where you need that superstar to maximize your budget and your conversions. If PPC is right for your company’s acquisition strategy, a top of the line agency is most likely the right choice.
Most agencies charge a management fee for PPC services, based upon a percentage of your media spend. The good ones might charge 10% to 20% of what you pay to Google, Facebook, etc. Not all of them operate this way, but it is the predominant revenue model. For a $20,000 monthly paid media spend (the money that actually goes to ads/media), at that 20% mark, that agency only charges you about $4000 per month to create, manage and optimize your advertising. Remember, they have a team of people working for you and you get all the benefits of a team we talked about earlier. An exceptional paid media direct hire for in-house will cost you over $6k a month or more (if you can actually find and hire one). So, once again, you get more value from the agency.
The only scenario in which I would suggest having a paid media person in-house would be for an e-commerce company who is selling a high number of SKUs that might be changing all the time. Even then, the right hire might be someone who acts as the liaison to the agency team and works with them to manage inventory issues and write compelling copy for the products. There are some great agencies out there that specialize in multiple platform E-commerce that can handle your web store, Amazon sales optimization and Ebay.
For most other types of business – B2B and B2C – a good agency has the potential to bring you far greater value with a much better cost of acquisition.
Social Media Marketing (Organic, Non-paid):
Organic social media is generally the only in-house position that makes sense to me for most companies. Because social media communicates the pulse of your business to your market, it is highly beneficial to have someone who is on staff handling this aspect of your marketing. They know the product, they are (hopefully) passionate about it and they can react to any changes in a more timely manner. They can manage your social indicators, respond to negative posts and really convey the spirit of your brand.
The reason I don’t include paid social advertising into this section is that, in my experience, a paid media person is far more qualified to manage your paid social media budget than the average social butterfly. The mindsets are dramatically different. Paid social plays under the same rules as other paid channels and may be managed by the same complex tools and platforms typically used for advanced paid media.
It takes a village to effectively run a multiple-discipline online marketing strategy. In most cases, you’re going to not only reduce your costs by going with a good agency but get a far better bang for your online marketing buck.
Remember those three reasons most business owners want to bring digital in-house? So far, I’ve laid out the financial case for not doing it. I’ve also addressed the control issue by illustrating that if you had an agency who was knocking the ball out of the park for you every month, you’d care a little less about control, right? An exceptional agency is going to communicate with you so well, you’ll feel fully informed anyway.
The problem is with number three:
Businesses don’t trust that their online marketing agency will deliver on their promises.
Remember those statistics about 1 in 40 online marketers knowing what the heck they’re doing? The same applies to agencies. Those mediocre workers had to come from somewhere. Unfortunately, the online marketing industry is ripe with mediocrity. It really is the industry’s biggest challenge and why businesses have trouble trusting their online marketers.
These trust issues are exactly why we started OnMark Advisors. Our years of online marketing experience, both on the agency side and on the business side, have taught us that the key to lasting success without drama is hiring an exceptional agency and holding them accountable.
Mediocrity Costs More than Exceptional Online Marketing
I know this sounds counterintuitive, but in online marketing it’s true. If you have a $20k monthly media budget, the difference between an exceptional agency and a crappy one might be $2k per month in management fees. But if the exceptional agency lands three times as many leads as the bargain agency, with that same $20k, while making you an extra $30k in new revenue, all while bringing down your average cost of acquisition, who is the real bargain here? Online marketing is not where you should be looking for the lowest bidder.
Finding and Hiring the Exceptional Online Marketer
The real challenge is finding and hiring an exceptional agency, one that you can trust to actually deliver what they promise. It’s not an easy task for the average business owner or marketing executive to do. Hiring an exceptional agency involves many of the same challenges as identifying a high-quality online marketer for your in-house team.
Unfortunately, I can’t teach you everything you’d need to know to systematically hire an awesome agency in one blog post. It really would require that I write a book, but I’m telling you, these agencies DO exist and they can literally change the trajectory of your business. I see it all the time.
It Takes One to Know One
Only an exceptional online marketer can properly identify and vet another exceptional online marketer or agency. If you would like help in this area, OnMark Advisors provides online marketing advocacy services that include agency vetting and selection as well as employee vetting services. We can help you identify, vet and hire an exceptional online marketing agency – one that is aligned with your goals and is a good fit for your business and budget. We can also handle the RFP process for you, as well as help you negotiate the contract in your favor. We do the same for companies with in-house teams. We can vet your online marketing job candidates to help you ensure their skill sets.
Whatever path you choose, in-house or agency, just be careful. It’s critical that you ensure the quality and skill of the person or agency you’re considering and fully vet them. Looking at an agency’s website and client list is not enough. Looking at a job candidate’s resume is not enough. Whoever you hire will be playing with your money and your company’s success.