There is so much going on in the marketing world today, spurred by substantial technological advancements. Marketers and agencies are trying to adjust to the new forces that shape the marketplace, but the transformation is not easy. The future is about marrying data-based creativity with technology, entertainment, and influencer marketing, which means marketers will have to make sure they have staff on board that can handle it. Data is no longer the by-product of innovation but is the innovation itself.
Hiring an agency might not be the solution to your problem. Agencies today need to update their skills and develop up-to-the-minute expertise. Any qualified Procurement and Marketing team or a search consultant should ask the following questions:
How tech literate are we?
This is time to check for gaps in technology services and skillsets. They leave agencies less than fully relevant. Have you developed platforms that bring business, brand, design, operations and technology together which can create a seamless omnichannel experience? Most agencies ignore investment in this, creating a vacuum that is happily occupied by the consulting firm.
Are we a cross-channel data expert?
Also, check that your data-driven marketing is strategic and transformative rather than tactical. You would like to know how they leverage data from myriad sources across paid, owned and earned channels, and also be able to create real-time dynamic ads, delivered through hyper-relevant targeting.
Do we think beyond screens?
Statistics show that by 2020, 30% of web browsing will be done without screens, and these interactions will be controlled by voice, gesture, or neural prosthetics. Some 100 million consumers will shop via AR. The context will take centre stage and will have to be integrated seamlessly with real-world locations 3D modelling and game design.
Do we collaborate with machines?
The need for content has exploded now that micro-targeting is becoming more common. As machines are increasingly used to generate and place assets, the roles of agencies need to evolve from just concept, including curating and iterating. Advertisers should be looking for agency partners that can create personalised marketing.
Do we create branded Entertainment?
Audiences are migrating to commercial-free streaming platforms, and more brands are looking to engage customers with original programming. This requires a fundamental reboot from traditional marketing and content marketing. Whereas traditional brands focus on positioning their brands in the minds of their customers, entertainment positions brands in the lives of their customers.
Do we understand influencer marketing?
Traditional advertising is becoming irrelevant and social media is becoming the prime platform, always-on influencer campaigns are evolving from a tactic to a mainstay of the brand’s marketing strategy. However, the growth of influencer marketing requires that agencies must learn how to measure the ROI of these campaigns.
Are we blockchain-enabled?
Ad-blocking software has over 200 million users and counting, but blockchain technology could make these tools obsolete. Blockchain will allow consumers to decide what to watch, and hopefully, give advertisers a modern, sophisticated means of producing high-quality leads.
Are we ready for the Amazon disruption?
If Google disrupted discovery, Facebook disrupted social, and Amazon’s data-enabled dynamic pricing is the most significant disruption ever in the marketing ecosystem. It threatens every brand and can commoditise markets at will. Brands will need to adopt custom-tailored strategies applied explicitly for this fast-moving, algorithm-enhanced and sophisticated platform.
Further to this query, there are some structural questions to be answered to as well. They are:
How readily available is talent?
The best talent doesn’t look for opportunities. With recruiters consistently calling, employers find them. This new recruiting dynamic has reversed the roles of hiring managers and employees; managers must now court employees.
With that said, a $500 LinkedIn ad is likely not going to yield the talent needed, even if you’re located in a marketing hotbed. You’ll likely need to hire a recruiter, preferably a specialist in the discipline desired.
Positions can remain unfilled for months even with top recruiters, numerous job postings, countless hours spent interviewing and mouthwatering compensation offered. Even if you successfully attract talent, you need to keep in mind that the recruiting lifecycle never ends. Recruiters will soon be calling your newly hired employee with promises of soaring salaries and unlimited career growth.
It is important to determine if your company has the means and commitment to retaining talent, or in other words, the budget available for raises, bonuses and employee perks. If your answer is not a resounding “yes!” the safe bet is to hire an agency.
What is the cost difference?
Try this simplistic yet inaccurate way to compare in-house and agency costs: divide the in-house salaries by 12 and compare that to the monthly agency fees. The average salary for someone with three to five years of experience is $65,000 to $85,000. However, the salary could be only the tip of the iceberg. You also have recruiter fees — the standard cost is about 20 per cent of the employee’s salary upfront.
There is also the cost of benefits and perks, including insurance to consider. Then there is the cost of employer taxes, which are not paid on agency fees. Technology costs can be in the thousands monthly for licensing campaign management software and other tools which agencies get at a discount that passes on to clients.
Also, there are costs associated with hiring mistakes, training and employee churn. And don’t forget the basic overhead for rent, desks, computers, etc. These costs are almost unlimited, but agencies aren’t running away with the bank – they exist because they provide a service that in the end, costs less than an in-house team. However, entry-level talent is inexpensive. If high-level expertise is not required, the cost of an in-house team could be less.
How scalable does the team need to be?
Account teams are structured in a manner that perpetuates thought leadership and growth. Multiple resources are assigned to an account versus a single resource. Commonly there is a strategist, manager and director. Each level is responsible for training their successor while being groomed by their predecessor. It is clear that agencies are essentially a mill for producing talent. Given the demand for talent, the costs of scaling a team through talent acquisition, without a farm system, is enormous.
Graded teams have other advantages: Junior resources have lower rates and turnover has less impact when one of the multiple resources is lost compared to a single resource. Agencies also allow companies to scale back costs without a negative impact on morale that results from downsizing.
Is it better to have resources on-site?
Some startup companies shaping their culture often have a desire to build teams in-house. In-house employees have intimate knowledge of products and services and therefore, may see the need for optimisations that agencies don’t. However, in-house employees often become removed from the marketing industry. A common complaint made by ex-agency employees that moved in-house is that they feel they lost skills.
Agency employees are immersed in marketing since other marketers surround them, and as a result, stay at the forefront through osmosis.
Therefore, the pertinent question is: Is it more important to have resources with intimate knowledge of company offerings or the marketing channels they manage? In-house teams optimise better for product nuances, but agencies are more in-tune with the latest marketing strategies.
One thing is certain in this life – decision making. The right decisions too, are arrived at after weighing the pros and cons. So, whether you should keep your agency or not depends on your answers to these questions.