Who would have ever imagined a “Virtual” wine tasting as a norm? Now we say “Why Not?!” What once seems like only an anomaly, such as outsourcing various business needs, is now becoming the norm..
Just a few short years ago, the concept of “no more business travel” to manage your client relationships may have sounded crazy! Handling most of your business through Zoom out of your kitchen may have sounded embarrassing and a signal of a struggling business model.
Fast forward to 2022, and the entire business world has turned upside down. A global survey conducted by Gartner, Inc. found that 88% of business organization all over the world mandated or encouraged all their employees to work from home as the virus started to spread at exponential rates. Furthermore, about 97% of the organizations immediately canceled all work-related travel.*
In addition, 85% of managers believe that having teams with remote workers will become the new norm.**
Doing everything in-house rather than outsourcing is as old-fashioned as business travel pre-2020!
With all the recent complete shifts in the entire workforce and business world, it’s actually more of anomaly to NOT start looking at your business structure differently. One of the main changes in the business world since the pandemic erupted has been the importance of outsourcing various components of a business’ needs. So, whereas in the past businesses relied on in-house talent for everything from accounting to payroll to legal, it has started to become the norm to look outside the business for those areas of expertise.
In fact, a study by a Clutch survey found that 8 in 10 small businesses (80%) plan to outsource business functions in 2021. Small businesses planned to outsource in order to save time, grow their company, and work with experts across a range of business functions. Overall, outsourcing provides small businesses distinct benefits.
There is a complete paradigm shift in the entire way businesses are handled.
In addition to controlling capital costs, increasing efficiencies, and reducing labor costs, one of the most important reasons why small businesses benefit from outsourcing is the ability to mitigate risk. As markets, competitors, regulations, and technologies are constantly evolving, it becomes practically impossible for a small business to juggle the various concerns—whether it's accounting, IT and security, compliance, or marketing.
Put simply, an outsourcing model enables a smaller company to operate efficiently, compliantly, and confidently by relying on experts, with the ability to scale at a moment’s notice. This levels the playing field, allowing them to compete with much larger, more established companies.
One of the most important business and staffing needs for companies, particularly small businesses, to consider outsourcing (or not) is for the function of Marketing.
Should you have someone in-house, or should you outsource the role of a marketing expert for your firm?
Do you need a marketing strategist, a CMO, a brand strategist, or something in between?
What exactly do you need, and should this person be in-house or external
Should this be a person or a team?
Should the marketing person work on behalf of the firm or for a particular individual at your firm?
In this article, we help answer these questions.
Please find below some of the Pros and Cons of outsourcing your marketing needs to an agency, versus building out an in-house team.
For more information around this topic, please read this article.
+ Why do I even need marketing if my entire business grows through referrals?
You definitely can ignore marketing, but in an industry that is getting more and more competitive, you will notice your referrals slow down or have many other options as your competitors become more active in reaching out to the people you want to meet. These competitors no longer include just financial advisors, but banks, investment bankers, accounting firms, and roboadvisory firms, to name a few. Without the usage of marketing to Beautify, Broadcast and bring Brand Awareness to your message, you will go into the category of the "Old Doctor:" The doctor we all love but know will be dying soon as he refuses to reinvest in his business.
+ What are the PROS of hiring an in-house marketing employee?
While Select Advisors is an Outsourced Chief Marketing Officer to wealth managers, attorney and CPA's, we do want to shed light on some pros to having an in-house CMO. Namely:
- Ultra heavy focus on only you and your marketing goals. With an in-house marketing professional, 100% of that person's focus will be spent on you and your goals.
- This person will come in, day in, day out, working on your behalf. They are heavily intertwined with you and your firm's marketing goals.
+ What are the CONS of hiring an in-house marketing professional, and instead the PROS of Outsourcing our Marketing?
Although there are some pros to hiring someone in-house (as we stated above), we believe that the cons far outweight them, making the case for Outsourcing your marketing needs to a full agency. Here's our reasoning:
- For starters, the cost: Depending on the experience level you are seeking in your marketing professional, a person with high credentials around marketing and a minimum of 10 years of experience will cost you at least $200,000 per year. That's not including bonuses, vacation days, insurance and more.
- Ancillary costs: Beyond just this internal person's wage, an in-house marketing professional will have many many additional costs they will naturally incur to do their job right, namely website coding, design, video production, advertising, social media lead generation and more. So beyond the minimum $200K, you are looking at at least another $100-$150K in additional expenses to give to this person for a budget.
- You may be saying "Oh, my marketing person doesn't cost nearly that much; I got him/her straigh out of college." Or "My personal assistant does my marketing work for me." That's great, but then how much does this person know about law, the markets, investments, speaking the language of retirees (your target market), etc? Probably not much, which means that then you and your team are spending this time training him/her, without the forecast knowledge if this person will even stay with you in the long term. What is your personal hourly rate worth? $500/hour? $1000/hour? Are you willing to spend that time training someone else how to do their own job?
- Another con of an Outsourced CMO is the lack of ability to scale UP and DOWN quickly. For example, in a business downturn, you may need to reduce your reliance on a CMO. However, with an in-house employee, you have this person as a fixed cost and many challenges around reduction of cost on a temporary basis. Similarly, during a business boom, when you want even more marketing work, you may not be able to scale up because you are reliant on just one person, not an entire team who can give you more time and efforts given your increased budget and want for more broadcasting of your story.
- You can get tired of ideas: Let's face it, marketing is a creative process, which can mean that it needs to constantly stay vibrant and exciting. Counting on just one person to come up with your marketing strategy can get quite boring. Outsourcing allows the ability to have best practices created through the process of working with so many different clients.
+ How do I select an Outsourced Chief Marketing Officer?
There is really no secret formula to selecting an Outsourced CMO. We believe your main priority should be the level of trust and confidence you can have in this person and/or agency taking over many of the marketing and branding decision making as it pertains to portraying you and your firm to your target audience. Do you want to focus on the ultra high net worth market? If so, is Tik Tok the best platform for you? Are you seeking to focus on the retiree market? If so, should you be doing podcasts? Maybe, maybe not. Again, there is no magic formula around marketing.
All of these are decisions that you can ask and discuss with your Outsourced CMO, rather than taking on the extra burden of making such big decisions yourself.
+ What should I expect from my Outsourced CMO?
Your expectations from and experience with your CMO may vary based on their capabilities and breadth of services. Here are Select Advisors Institute, for example, we customize every aspect of marketing for our clients, from branding, renaming, client experience marketing, digital marketing and so forth. Some other agencies see marketing as only one vertical and provide that as a Marketing Officer.
The most important decision to make is how involved you want to get in the marketing process. The less you want to get involved, the more you need to expect and rely on a CMO. Also, keep in mind, if you are "OUTSOURCING" the process, try to stay OUT of it as much as possible!
Also, keep in mind, if you are "OUTSOURCING" the process, try to stay OUT of it as much as possible!
* Gartner.com
**Findstack.com