In the majority of instances, I believe paid marketing initiatives should be managed by an external agency. Many times when I talk to companies about their paid marketing initiatives they are typically biased towards hiring full-time employees to manage their efforts because they believe it is more efficient. This is mistaken and having seen many companies on either side of this equation, agencies are usually the better option.
Generally I am of the opinion that paid marketing should be maximized before SEO, but I will save that for another note. In the meantime these are the ten reasons I think agencies are better than in-house employees for paid marketing efforts.
Very few organizations would ever sign up for the fixed and recurring costs of setting up a physical data center for the technical needs instead they opt for the flexible and more efficient options of AWS, Microsoft Azure or Google Cloud. Performance marketing should be viewed the exact same way. Working with an agency allows a company to scale up and down or even pause paid marketing if needed. A full-time employee is a fixed cost with a salary that must be paid regardless of current needs.
- Better talent
Anyone who has tried hiring in the last year knows how difficult it is to find good marketing talent. The demand for a limited supply of expert marketers has never been higher and even junior talent with limited experience are commanding higher salaries. By choosing to work with an agency a company can have access to talent they might not have otherwise been able to hire. While a junior employee might be the person that directly manages an account within the agency, they will be supervised and mentored by people with significantly more experience.
- It’s cheaper
This may come as a surprise to many people that have evaluated agencies and then opted not to retain one because of price, but I think if you do the math here you will see in nearly all cases an agency is less expensive on a number of fronts. Most agencies charge between 5-15% as a percentage of spend for their management fee. Using the more expensive fee of 15% that would mean a cost of $150,000 on $1 million of spend. (More than likely, this fee would even be capped far lower but for the sake of argument let’s keep it uncapped.) Comparing that to the all-in cost of a full time employee many companies might discover that they are paying more than 15% of spend. A second reason that agencies are actually are cheaper comes down to learning curves.
- Learning curve at scale
In any performance marketing effort there will always be a learning curve on the audience and platform which inevitably will cause inefficient spend as a new paid marketing manager gets up to speed. In an agency, the team managing the account will be quicker to hit the ground running as someone on the team has already experienced your challenges on another project. Agencies are not immune to learning curves, but the actual curve is spread across all of their accounts and not just on your one project.
- Agencies grow with you
I always believe it’s important to work with an agency that has experience with extremely large accounts as how to manage accounts can absolutely differ at varying spend levels. An internal employee might be fantastic at lower spend, but may struggle once the spend starts to scale. An agency with experience at all spend levels will seamlessly be able to update strategies and tactics as spend grows.
- Ad network Customer service
The major advertising networks have millions of customers which all contribute to their $billions in advertising revenue and they simply can’t provide the highest level of customer support to all of their customers. With all the $billions spent on advertising even companies with spend in high six figures may discover that they are not considered big enough customers to get top tier support. By working with an agency, you can fall under the umbrella of the agency’s spend, and they can get support for your account when needed.
Agencies typically have SLA commitments and they will be available at whatever times they commit to. That means if your account rep falls ill on the eve of Black Friday there will be a fallback to make sure you are getting the support you need, the same can’t be said of internal employees.
- Broader capabilities
The one guarantee about marketing is that things will always be changing and it will be impossible to predict. While Google and Facebook eat up large chunks of global digital spend they are far from the only platforms. Each of these platforms have their own nuances so what works for Reddit might not work on Quora or learnings from YouTube don’t necessarily work on TikTok. For a company with a broad appeal they might have to hire niche experts for each of these platforms, but with an agency you can have access to an expert in each platform.
- Deliverable based
While you may be amazing at interviewing, inevitably employees will be different than how they come across in the hiring process, and you will be stuck with that employee even if they can’t accomplish everything you had hoped for. With an agency they are signing up for a specific deliverable and they are on the hook to achieve it or be replaced.
- Access to a network
The final reason agencies are better than in-house is that by working with an agency you get instant access to a network of similar marketers through the agency’s other clients. In the agency interview process find out the names of other brands that work with the agency. Agencies want their clients to talk to each other as it brings value to their client base and creates goodwill towards the agencies.
TL;DR don’t write off agencies just because you think having employees manage your paid marketing efforts is less expensive and more efficient. I have been fortunate to work with some fantastic agencies and please respond if I can make an intro!