THE REAL COST OF MARKETING: EXPLORING AGENCIES VS. IN-HOUSE TEAMS

hen it comes to expenses, we understand that businesses need to make a profit. Each item on the list is carefully considered against the bottom line. Marketing expenses are reviewed under a microscope in this regard, ensuring the investment has a payoff.

Reviewing a proposal from a marketing agency can be daunting. So, let’s break it down to understand what goes into the costs and how hiring an agency versus an in-house team can actually decrease the line item while boosting the ROI.

What are the true costs of marketing?

As a marketing agency, we subscribe to many software programs and services that make our jobs more efficient: social media monitoring and scheduling tools, CRM software, email newsletter programs and so on.

Below is a look at how some of those costs breakdown. There are a variety of brand names available with different features, and we chose some common ones for this simple analysis. Note that many times the cost of the subscription is based on how many contacts are used.

• CRM: Hubspot $890 per month for 1000 contacts for a $10,680 annual cost
• Email marketing tool: Mailchimp, $1020 annually for 5000 contacts
• Basic social management: Sprout Social, $1788 average annually

This totals $13,488 just for access to basic softwares that promote effective marketing. Then, of course, you need someone to operate all these skills. The specific skills used on each software are diverse, and can include:

• Layout and design
• Content creation
• Social media strategy
• Website design

While it is possible for an individual to possess all these skills, it's likely that each person will still have their areas of strength and others that are less developed. As a comprehensive marketing agency, we have a person who specializes in each specific task.

Here’s a brief look at average salaries for each position that would be required to have a person with an expert skill set in each area (according to Indeed.com).

• Web Developer: $69,190
• Social Media Manager: $46,940
• Graphic Designer: $50,407
• Copywriter: $52,612

That’s a total $219,149 in annual salaries in order to build a team that would just get you started in house.

The True Advantages of Hiring an Agency vs. an in-house Marketing Employee

• Agencies take out the learning curve of training a marketer in the industry.
• Agencies have a wide variety of skills that would require hiring 6 to 10 people full-time to cover.
• Agencies already subscribe to softwares needed to effectively market your company.
• Some agences, like Steel Mountain, are specifically focused in certain industries reducing that learning curve. We love marketing all things manufacturing!

Looking to understand more about the intricate world of marketing? Check out our Digital Trek guide to effective marketing to guide your hiring decisions.

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