I read with interest the following article in Econsultancy entitled ‘Marketers doing more in-house: the trend no-one talks about‘.
It’s based on the research conducted for their Best Practice Guide to Insourcing and Outsourcing which indicates that although this is an ever-changing dynamic, there are some clear patterns for those functions most likely to be outsourced and those for which clients are increasingly developing in-house capability. One such pattern, for example is a key trend in taking content related functions such as SEO, analytics, data and social media in-house.
The design industry has been a victim of advances in technology for decades now – think of how many SMEs now develop their own collateral, ranging from asking a family member (who once did a course in design) to come up with a logo to developing a website from ThemeForest. A design agency would certainly insist that you could never build your own distinct and meaningful brand identity with joined-up communications and collateral from a simple logo dreamt up in someone’s bedroom and a digital agency would certainly argue the benefits of developing at the very least a bespoke theme with a robust platform.
The insource-outsource argument has always existed and I’ve no doubt will continue to be there, so here are a few ways we try and counter this response from prospects and try to build some compelling reasons to consider outsourcing.
Firstly, it’s important to make sure that you establish exactly what the prospect means when they say they are ‘doing it in-house’. This can often mean that they’re outsourcing quite a bit of their function but may think they’re not, especially when compared to a previous company or role. So, when you probe a bit more and ask, for example, whether they have a creative studio on-site or HTML coders on the team, the answers could indicate that they do, in fact, outsource a reasonable amount.
It’s vital that you understand their reasons for not outsourcing. The reasons may be based on an often emotional response to a negative experience of an agency in the past rather than a considered view of the rational benefits of outsourcing, some of which are summarised below:
- Fresh perspective – agencies can bring a fresh point of view from an external stance which translates into more informed advice and often better insights into what works and what doesn’t
- Solutions – agencies work with many different companies from different markets who have faced a broad range of challenges, which means they have more exposure to alternative and often more effective ways of finding solutions to problems
- Flexibility – outsourcing means you can ramp up or reduce resource as and when required which is a much more cost effective way of working
- Specialism – an agency is much more likely to have access to ad hoc specialists who are not needed on a daily basis and who can be an expensive resource if idle.
- Speed – if a requirement for a specific expertise arises an external agency can often respond more quickly, particularly if they have those experts in-house or at least have instant access to reputable and reliable associates. Equally, an agency is more likely to be prepared to work through the night – this is a competitive marketplace and no agency is going to run the risk of losing an account through not delivering on time!
- Convenience – recruiting, managing and motivating an internal team can be time consuming and expensive and is often under estimated by prospects. Working with an agency means there are no concerns about holidays or sickness and about how to integrate them into the rest of the organisation. Most employees will want a defined career path offering progression – an agency won’t! ‘Urgent’ internal projects could take priority over a longer term proactive strategy for a CMS development for example.
- Cost – it can often be more cost effective for a company to outsource when needed rather than retain skills in-house that may be redundant much of the year. Equally, if there’s new technology to be learnt then there is an investment in both time and money attached to ensuring your in-house team is kept up-to-date. There may also be teething problems when using new technology which can lead to costly mistakes – this is much less likely to happen with an agency who is already experienced in how to use the new technology efficiently and effectively.
- Accountability – an outsourced agency can be more easily held accountable for delivery of their service level agreement and any subsequent promised outcomes.
- An in-house team is often well placed to deal with everyday issues but they will have considerably less experience than an agency at dealing with the new or the extraordinary
- Outsourcing to agencies with an external perspective and a range of experience often means faster, cheaper and more effective solutions
- There are less risks involved in using experts and specialists
By the way, if you’re considering insourcing your new business activity, the same principles apply!