To outsource or not to outsource? It’s a question that arises again and again in professional services management meetings. And the topic surfaces with particular frequency these days around the practice of marketing. Why? Because professional services marketing is evolving, and many firms are struggling to keep up.
For years, professional services have been marketed through personal relationships, referrals and a variety of networking and educational events. It was all about who you knew.
But all that is beginning to change. There is a new generation of buyers on the scene who have grown up with the Internet at their fingertips. They expect to be educated for free. They expect transparency in their professional services providers. And importantly, they expect to find a firm that fits their needs exactly, whether they work in Bangor, Maine or Bangkok, Thailand.
As a result, marketing today is no longer about who you know, but what you know. And how well you can spread the word.
The Rise of the Expert Through Content Marketing
This trend has provided fertile ground for a new, Internet-fueled incarnation of an old concept: the high-profile industry expert. More and more experts are rising from obscurity to become well-known names in their fields. We call these stars Visible Experts®, and they are leveraging content marketing to power their rise to prominence.
Interestingly, the rise of content marketing has also driven the development of outsourced marketing. Today, the skills required to market a firm are vast and varied. And because many of them are driven by technology, they require a great deal of expertise to keep up with the pace of change. Many firms don’t want the headache of keeping on top of all this change. So they turn to outside marketing firms to fill in the gaps, or even take the reins. In fact, we’re seeing evidence that firms are spending roughly 3 times as much on outsourcing today than they were two years ago.
Before we dig into this phenomenon and its implications for you, let’s begin with a definition.
Outsourced Marketing Defined
Outsourced marketing is the practice of contracting an organization’s marketing functions to an outside firm. Both strategic and operational functions can be, and often are, delegated to a third-party marketing partner, which has the specialized expertise, tools and professional staff to provide a complete suite of marketing services. And because it is responsible for the program’s performance, the outsourced partner usually reports regularly on the program’s performance.
Of course, professional services firms rely on different degrees of outsourced marketing, from handling everything in-house to outsourcing every function (see Levels of Outsourced Marketing Activities below).
For example, one marketing function commonly outsourced by professional services firms is website design. Very few firms have the expertise in-house to design and develop a complex website. It is a task best suited to a firm that designs and builds websites every day.
Some businesses, on the other hand, outsource every aspect of their marketing. This allows their leadership and professionals to focus intensely on their core business. They rely on their marketing partner to propose the strategy, implement it and report on its progress. Their marketing firm is a critical partner in their success.
Who Uses Outsourced Marketing, and Why?
Outsourced marketing is common in professional services firms of all sizes and across all industries. Even individual experts and practices within larger firms often seek outside marketing expertise.
There are many reasons firms outsource some or all of their marketing. Here are a few of the most common situations:
- A firm can only devote a limited number of hours each week to marketing and they want to improve the quality and consistency of their marketing.
- A small firm has no budget for a full-time marketer. Outsourcing frees up valuable, often billable, time they can spend serving their clients.
- A large firm understands that outsourcing certain functions, such as content marketing, can be cheaper and higher quality than doing it themselves.
- A marketing department uses an outside marketing firm to take over routine, repetitive or tedious tasks, such as designing and setting up email campaigns, so that they can focus on more strategic tasks.
- A firm wants top-drawer marketing. Outsourcing to a reputable partner provides access to a team of highly skilled experts across a wide spectrum of marketing disciplines.
- A firm’s partners are tired of investing in marketing yet never knowing if they are getting results. Their new outsourced marketing firm provides full accountability, measurement and reporting.
- Leadership believes their marketing department is out of fresh ideas. So they hire an outside firm to provide marketing strategy, as well as implementation support in areas the in-house team is weak. Everything is handled by professionals who keep up with the latest trends, technologies and techniques.
Levels of Outsourced Marketing Activities
Many firms outsource marketing functions in a haphazard way. Often, outsourcing decisions are reactive — filling unexpected gaps in resources. Firms don’t always understand that outsourcing can be a strategic asset, one that can vastly improve the efficiency and quality of their marketing. But to make the most of it requires at least some advance planning.
To help you better understand your situation, we have developed a scale of outsourced marketing maturity. Marketing tasks tend to be either specialized or routine. Specialized functions are needed infrequently and require a relatively high level of skill. Routine operations are conducted on a regular basis and require less skill, though they are not necessarily easy to implement or manage.
This scale is a tool you can use to determine your firm’s level of investment in outsourced marketing. It is not a measure of marketing sophistication (for instance, a Level 5 is not necessarily better than a Level 1), nor do individual levels correspond to firm size. But if you are evaluating outsourcing as a strategy, this scale can help you understand how you compare to other firms.
Level 1 – All functions in-house. This level tends to apply to firms at both extremes of sophistication — those that do little marketing at all and those with large, highly skilled marketing teams.
Level 2 – Some specialized functions outsourced. Usually this approach is used by firms that try to handle most of their marketing inside the firm even if they aren’t expert at them. These firms outsource only when they don’t have the skills to carry out a particular task (such as designing and coding a website).
Level 3 – Outsource specialized functions. Retain routine operations. These firms want experts working on the most technical aspects of their marketing. A relatively low-level in-house marketing team takes care of the more straightforward tasks.
Level 4 – Most specialized functions and some routine operations outsourced. Firms at this level maintain a very small marketing team to handle a few tasks that they want to keep close to home. But the majority of their marketing is conducted by an external firm that coordinates with the in-house team.
Level 5 – All functions outsourced. At Level 5, all marketing, including much of the strategy, is handled by a third-party team. This team works closely with management to align the marketing strategy with overall business objectives. Firm management is kept apprised of performance at frequently, regular intervals.
5 Benefits of Outsourcing Marketing
Why is outsourced marketing so popular with professional services firms? As it turns out, the reasons are rooted in the changing nature of professional services marketing, itself. Here are five compelling reasons that firms invest in outside marketing:
- Marketing is not a core function of most professional services firms. Professional services firms tend to be run by accountants, attorneys, management consultants, engineers, or other professionals in their fields, not marketers (though there are some exceptions, to be sure). These professionals are often unfamiliar with the latest marketing trends and techniques — and they may not be inclined to become experts in yet another specialty.
- Effective content marketing requires a growing, diverse skill set. Once upon a time, firms could get by with home-grown talent. Scheduling networking events and attending an occasional trade show require few specialized skills. Today’s marketing, however, requires highly developed technical expertise such as search engine optimization, landing page design, offer development, website analytics, persuasive writing and marketing automation — to name just a few.
- Outsourced marketing is less expensive. While the fees for outsourcing may seem high at first, they can, in fact, be quite cost effective. You get access to a very diverse, high-quality set of skills without having to hire, train and supervise a team of specialists. You are only paying for what you need when you need it. And since you are using the talents of experienced specialists, they are also likely to produce better outcomes.
- It helps keep your most valuable resources focused. Traditionally, professional services firms have relied on their most valuable people to write thought-leadership content and do the networking required to generate new business opportunities. But these demands take away from a professional’s billable time — an unending source of frustration for marketing directors everywhere. Outsourced marketing is changing that balance. An hour-long interview with an expert can provide enough information for an entire content marketing campaign. This can save many painful hours that experts might otherwise spend writing content themselves. Further, the outsourced marketer typically produces a superior outcome.
- Outsourced marketing provides a single point of accountability. With the ascent of content marketing comes the rise of trackable marketing. Modern analytics and marketing automation tools let you track results very accurately. Accurate monitoring allows for clear accountability. In short, your outsourced marketing partner is accountable for results. That should be music to every managing partner’s ears.
3 Risks of Outsourced Marketing
Like any investment, outsourced marketing comes with certain risks. Here are three of the possible costs associated with outsourced marketing:
- Internal morale and accountability issues. Depending on what functions you will be outsourcing, your existing marketing staff may feel threatened when you bring on a new marketing partner. In addition, your team may not be used to the pace and pressure of a results-oriented marketing program. To manage these problems, you will need to clearly define people’s roles, let staff know that they are part of a larger team now and explain that success depends on everyone doing their part.
- Less on-site access to the marketing team. In some, but not all, outsourcing situations the team performing the marketing function may be located off site. This arrangement may or may not be new to you, depending on your firm’s remote work policies. Getting used to working with off-site partners on a daily basis may be frustrating and a difficult adjustment.
- Potential higher cost. Most outsourcing advocates report that outsourcing costs less. After all, it allows you to avoid the long-term costs associated with hiring and supervising new personnel. You pay for only the services you need. Some firms, however, find that outsourcing increases their marketing costs. We believe this happens when firms do not sufficiently fund marketing to achieve success. When they began an outsourcing program their costs are higher because they are now paying for the resources it takes to generate results.
Typical Outsourced Marketing Services
We turn now to the core marketing functions of a marketing department — all of which can be outsourced. Keep in mind that there are many different ways to describe the wide range of marketing functions. For example, you can outsource a senior marketing executive or a particular operation, such as telemarketing.
- Research — Includes researching your marketplace, competitors and clients. Research can uncover a wealth of insights into market opportunities, buyer personas, service relevancy and pricing. It can also help you understand your employer brand and recruiting strategies.
- Strategy — Covers a wide range of high-level guidance for every level of the organization, such as overall firm-wide growth strategies, go-to-market strategies for specific practices, personal development strategies for individual professionals and succession planning. It also includes developing differentiators, positioning and messaging to different audiences.
- Creative — For the most part, this function encompasses graphic design and writing. It includes logos and brand identity, marketing materials, website design and development, marketing copy, signature content pieces and anything else that requires a creative touch.
- Training — Building business development skills is a continual challenge at many firms. This category includes training relevant staff in business development techniques, CRM and marketing automation technologies, networking, social media and other marketing- and sales-related skills.
- Operations — This consists of running day-to-day marketing operations. Examples include content production and editing, public relations, social media support, events, webinars, email campaigns and database support.
- Analysis — You can’t fix what you can’t measure. An effective modern marketing team has to be able to track, analyze and report on every aspect of its program — such as online analytics, email performance, lead generation, opportunities, proposals and wins/losses. Armed with this information, your team can adjust your plan as needed.
Inside the Outsourced Marketing Department
How is a typical outsourced marketing department structured? Now, I’m not talking here about individual freelancers — they require direct supervision from your team and have limited strategic value. I’m referring instead to Level 3, 4 and 5 engagements on the outsourced marketing maturity scale. How would such an arrangement function?
To keep everything running smoothly, you need an account person (or team) that handles ongoing communications and manages your engagement. Competent project managers can make a tremendous difference in the quality of your partnership.
Of course, the outsourced marketing team will include individuals who do the work. Typically, these will be specialists in critical areas: research, strategy, design, social media, SEO, writing and so on.
There should be QA process that double checks all work before you ever see it. It’s far too easy for embarrassing mistakes to sneak through without it.
A critical component of the engagement is reporting. You and your account team should be meeting on a regular basis — usually once a month, though it can be as often as once a week — to review work in progress, go over performance metrics and discuss any adjustments or changes in course. Reporting not only provides an opportunity for the teams to collaborate and monitor progress, it establishes accountability on both sides, as well.
Should You Outsource Your Marketing?
Is outsourced marketing right for you? It’s a question more and more professional services firms are asking. Most firms already outsource at least a few tasks, such a graphic design and writing.
In many industries, competitive pressures like automation, legislation and market changes are forcing them to revisit every aspect of their operations, including marketing. Other firms want to move away from staffing non-core functions in which they don’t necessarily excel, focusing on the things they do best, instead. There is also a well-established and growing trend of offloading key tasks to subscription-based services.
As you review your marketing program, look at each piece and ask yourself the following questions:
- Is this activity central to what we do?
- Do we know how to find and manage the talent it requires?
- Does it have a steep learning curve? And can we afford to climb it?
- Does managing this function feel natural?
- Can we afford the fixed overhead?
If you can answer yes to all five questions, that function should probably remain in-house. A single “no” puts a function on the fence, and you should think about how good a fit it is for the talent and time you have on your team. Could a specialist do it better? If so, is the extra quality worth the potential cost? What would your internal resource do instead?
If you answer with multiple “no’s” to the five questions, then it’s a good candidate for outsourcing.
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