Outsourcing is not a new concept and is commonly used within functions like IT, HR or Accounting. Marketing outsourcing, whilst common in the US (51% of businesses outsource elements such as content creation and PR for example), has not yet been fully embraced in the UK, but with potentially further economic challenges over the horizon and a growth in entrepreneurs and investors looking to cut costs and focus efforts on core business activity, it is on the rise here too.
"Where the work can be done outside better than it can be done inside, we should do it." Alphonso Jackson. Former US Secretary of Housing and Urban Development.
Outsourced Marketing is about handing over the marketing requirements of your business to a third party – the benefits and outcomes being:
- Access to specialist skills & expertise that you may not be ready to bring in on a permanent basis
- Cost cutting – reduce the size of in-house teams, overheads and recruitment costs
- Focus on core business – Free up management time for more critical operational and commercial tasks
- Flexibility – the opportunity to access a team with a range of skills that can be accessed and invested in at the right times for your business and therefore the ability to scale up and down in line with your requirements at any given time
- Productivity – better visibility of time spent vs deliverables
- Reducing the need for multiple specialist agencies and the associated management costs
How does it work? The three flavours:
1. Basic model - Single programme ownership
The basic model (which many companies already use) is used by organisations to outsource specific on-going marketing functions such as promotions, telemarketing, content programmes, social media and digital marketing. In this model, your existing team manages an agency or multiple agencies to deliver the programmes, probably on something like a three-month rolling agreement.
2. Advanced model - Outsource of all programmes
The next jump, which is less common, is where an organisation outsources all (or most) of its day-to-day programmes on a long-term basis (say 12 months), but retains a director to oversee operations and work with the outsource partner. The outsource partner often helps define and deliver the strategy and supports day-to-day sign off and running of marketing deliverables and programmes.
3. Ultimate - Virtual marketing director
Increasingly, businesses opt to outsource the full ownership, strategic development and roll-out function. In this model, the outsource partner takes the role of the marketing director and is responsible for the running and resourcing of all programmes. The (virtual) marketing director plays a full part in the management team with responsibility for inputting into the development of marketing strategy and, depending on requirements and size of the business, the company strategy as a whole.
What sort of companies go for Advanced or Ultimate (Virtual MD)?
1. Venture capital companies, investors or acquirers who are buying (sometimes underperforming) companies or are looking to integrate new companies quickly and don’t have the time to organically grow their marketing functions.
2. Fast growing small to mid-sized companies - Companies who want to expand activity quickly and would benefit from a ready-made team that has worked together previously. (Experience of relevant sectors helps here so that the team can literally hit the ground running).
3. Start-up companies moving to the next phase - Often these organisations have built their initial success around a strong product or service offering (and perhaps initial sales), but need marketing to take them to the next stage in terms of market reach and growth.
4. Companies with a problem to fix - If you have been through a number of marketing directors/team members and have struggled to find the right fit this could be a less painful approach.
5. Businesses that want to save money and don’t want to commit to expensive head count. For example, the cost of a full-time marketing director (£100k pay, £150k total employment cost) could provide access to an entire (senior) outsourced marketing team.
So, how do you know if outsourcing marketing might work for you?
If you recognise these gripes then it might be worth exploring:
1. Marketing isn’t adding as much value as we need it to – we need to be able to demonstrate value to sales and the management board
2. Activities are ad hoc and do not appear to be designed to support our day-to-day sales activities or our long-term objectives
3. Visually, our marketing material looks great, but it doesn’t really convey our value proposition to customers, prospects or internally to staff
4. We seem to need access to a greater range of skills, but don’t want to invest in multiple heads or work with multiple agencies. The skilled people we do interview are often too expensive and we end up trying out different agencies for different marketing programmes/projects to get the job done; the whole thing ends up disjointed and a bit of a headache
5. Marketing is very dependent on our product experts and management team to write content; whitepapers, blogs and the like
6. We don’t seem to be communicating the totality of what we do clearly with our customers and prospects
7. We are heavily funding a number of agency retainers – there must surely be a way to consolidate costs and approach this more efficiently?
Object to outsourcing marketing?
You may have a number of concerns including:
- Culture – How would this model work with my existing teams?
- Commitment and passion – Will the outsourced team providing our service be as committed as employed staff?
- Knowledge – Will the outsourced team understand our products and services in the same way as internal staff?
- Engagement – How would it work? How does the team operate? Would they work at our offices? Would they use our email addresses? Can they be trusted with our confidential information?
The answer to all of these questions and many more questions will depend on the quality of the people you work with and how well they can become embedded within your business. Have a chat to some companies and get them to run through how this has worked for them.
Intrigued? Here is an overview of the process we (generally) follow with customers looking to outsource:
Step 1 Triage your marketing effectiveness
We conduct a snapshot of existing marketing effectiveness against your businesses goals, delivering a report that identifies the main pain points (within and relating to the marketing function) and produces recommendations for a get well plan (more on this process in a blog to follow).
Step 2 Marketing planning
Building on the Triage recommendations, the marketing plan will deliver a (typically) twelve month detailed and costed programme of activity potentially covering a number of key areas such as; foundational work (visual brand review, development or evolution as needed, value proposition development and articulation, web presence review or creation), sales enablement work, customer retention plan, customer acquisition plan, investor relations (if needed), acquisition/integration plan, and internal communications plan. When the plan is agreed, resourcing and specific outsource team structure are then defined and agreed in line.
Step 3 Foundation work
Optimum marketing effectiveness depends on a strong brand and proposition foundation. You may already have some or all of this in place. To our mind, it incorporates:
1. The visual brand of the organisation
2. The company, product and service proposition, and market positioning (articulated clearly and documented)
3. An effective online presence that conveys points 1 and 2 to your target audience
4. Strong customer and prospect data sources for effective marketing activity.
Step 4 Delivery
Marketing activity most often needs to get started before all of the foundation elements are complete; it’s just the reality of running a business and having to generate awareness and leads. The outsourced team will start to deliver programmes, providing monthly granular reports to enable you to see what you are getting for your money!
If you want to discuss in some more detail, drop us an email or take a look at this video from Accumuli which talks you through our approach from a customer’s perspective. Please also see comments from a couple of our customers; Accumuli , JET petrol stations or EQALIS.
Thanks for reading and good luck!