THE AVERAGE SALARY OF AN ENTRY “IN MOST CASES, WORKING WITH A FIRM IS LESS EXPENSIVE THAN THE SALARY OF EVEN THE MOST JUNIOR, ENTRY LEVEL PERSON.” — RODGER ROESER, PRESIDENT
AGENCY OR IN HOUSE? THE FISCAL AND PRAGMATIC TRUTH
It’s something I may never understand. I’ve thought about it, dwelled upon it, made a pro and con list, even played devil’s advocate – and I still can’t figure it out. Why do so many organizations, even small ones, insist on attempting to do their marketing, advertising and public relations in house? Now, before you say “this guy owns an agency; of course he’s going to say this,” understand that I worked “in house” corporate for 10 years before going to an agency. During a recent presentation to small business executives in Cincinnati, I asked for a simple show of hands how many had an outsourced attorney. All of them. An accountant? Each and every one them. Yet, when I asked about investing in something that actually MAKES an organization money, not a single small business owner had hired a marketing consultant. Several had a very junior individual on staff that “handles that sort of thing.” How frightening. These executives are entrusting their brand and the marketing of their organization to either no one, themselves or in many cases, the administrative assistant. So again, I dwelled – thinking as to why? And without any offense intended to the “Suzy’s of the world,” I asked. And, let me stress, choosing to hire an expert or to hire an agency to assist you doesn’t mean you’ve failed or that you’re being called out. It means you’re taking a positive step to eliminate non core activities and utilize the expertise of those that can help you efficiently succeed. Not at least looking into it as an option is just not business wise. Hire the agency, get the great work and take all the accolades – a good agency is here to make you look good, and you can’t always say that about internal staff. Now, on to the excuses.
IT’S TOO EXPENSIVE. Why is it when the economy gets tight, what’s the first thing cut? Marketing. Not marketing activity, mind you, rather marketing personnel. Why? They’re an expensive luxury, internally. Hiring an agency is considerably less expensive when you hire the right firm – keyword right firm. Most good counselors simply charge by the hour for the work performed, meaning no additional overhead and no constancy of invoicing to an organization. In most cases, working with a firm is less expensive than the salary of even the most junior, entry level person. For example, our firm typically charges $100 an hour for services. Even entry level folks coming in are compensated at about $25,000, plus taxes, benefits and other costs associated with them being internal – so this entry level person is, in reality, closer to $35K annually. That, Mr. CFO, is a lot of marketing time from an agency – 350 hours! In addition, if you need that much marketing, chances entry level Suzy is in no way qualified to perform the work, but that’s later.
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AGENCY OR IN HOUSE?
In addition to the salary is the investment in computers, software and online programs, and other miscellaneous tools used by a good agency to do their job. Why, oh why would a landscaping company go in to the marketing business? Software we use at our firm, for example, is an investment we make on behalf of our clients and is standard for doing business – and is a large investment. Without these tools, we can’t do our job, and chances are, you don’t have them. Nor, should you. I don’t have a lawnmower at our office. The right size firm for the right size company is a good investment, and one that can be simply turned on and off as you need it. Don’t get suckered in to a high retainer, and make sure that whomever you hire is actually doing the work – if you don’t need a “senior strategist” don’t pay for one. Ask questions and hire what you need. The quality and expertise of most firms far surpasses what most have in house. And, they’re a great stop gap for overflow. No vacation days. We’ll never call in sick, and you don’t have to pay us unemployment when you need to “cut costs.”
I’LL LOSE CONTROL. As if you’re in control with an internal team, right? Most business executives outside of the marketing department have no earthly clue how to manage this function to begin with, so you hire someone who does and hold them accountable for performance. Internally, there are politics. There can be a fear of honesty and candor, and entirely too many drinking the Kool-Aid. Marketing and growth is not for “yes” men. Telling Suzy to send out a press release because you just added the color blue to your logo is not “controlling” your brand or your message. Rather, you are being controlled by the market factors around you instead of being strategically proactive and making a positive influence to your brand. And let’s be honest, poor Suzy simply does not have all the nifty tools nor the expertise of a good firm. Control comes from having the ability to lead and manage, and it’s virtually impossible to manage or direct something most executives (all of whom are marketing experts, right) do not understand or have expertise. In addition, why would you want to? A good firm can objectively counsel as to best practices in growth and gain of market share, which segments are smart to target, how to go about it, and be fresh in creativity. Executives, can you tell me what your main trade publication is writing about in six months – I can. Do you know exactly which segments of your business are expected to grow? I do. Do you know the best and most cost effective ways to reach out and secure new business? I do. Do you know what consumers are saying about your brand in cyberspace? I do. And while you may have bits of pieces of this, why focus on these non core competencies – you’re a landscaper. Hire the right professional firm, and take control of your marketing, your brand and your reputation. Chances are, you’re probably doing some things right, after all, you’ve made it this far. But that’s not going to suffice in an increasingly competitive business landscape, and much more control is there to be gained by working with those experts who objectively have your best interests in mind.
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AGENCY OR IN HOUSE?
WE CAN DO THAT OURSELVES. No. You can’t. The only reason you may believe that is because you haven’t seen the real power of an agency – it’s like comparing a pee wee football team to the Pittsburgh Steelers (the 1978 Pittsburgh Steelers, to be more exact). I guess the analogy may more closely be that if you don’t know the right way or you haven’t had the tools, you don’t really know what you’re missing or how good things could be. I still see Publisher being used to create flyers and newsletters for so called “high end” organizations. I see websites that haven’t been updated for years. The current news section has issued a press release since the 90s, and the last time the organization was published or did an interview dates back to the Bush Administration – the first one. We have found that the vast majority has no marketing plan or strategic plan, no crisis management plan, and their idea of managing social media is to ignore. I will admit that I don’t believe what agencies do is rocket science, but the fact is, most good agencies have some amazingly talented and creative people that are exceptionally skilled with various public relations, social media, and advertising best practices and software. Can I drywall my living room? Sure. It’ll look like hell, but I physically “could” do it. It would likely not be the smartest thing to do to raise the sale price of my home (the value of your organization). Good agencies have the ability to write compelling news articles, find terrific news angles and have the right contacts to reach out to and sell a good story. A good agency has creative masterminds that can integrate entire campaigns, timing things perfectly and measuring their specific impact and success. They can work within a specific budget, and manage personnel, vendors and outsourced costs with significant skill. A good agency can manage a fully integrated campaign with as much ease as a master carpenter making a bench – it’s what they do, and they’ve done it a thousand times. Recently, a company decided they could do a citywide billboard campaign for six months for $1,000. $1,000. You see, when you have no basis or understanding of what things actually cost, or should cost, any number makes sense. When you don’t know where the destination is, any road will get you where you’re going. Do yourself and your business a favor – hire an outsourced expert. A good, reputable outsourced expert. They will save you money, not cost you. You can turn them on and off as you need, and they will give you good, objective counsel and advice. They can assist with senior level strategy and grunt labor. They allow you to focus on your core objectives and what your organization does best. You wouldn’t go to court without a lawyer. You wouldn’t run your books without an accountant. Why on earth would you attempt to market, manage, protect and build your brand without a marketing expert? If you have an internal marketing director, let them direct the marketing. You don’t need the expense or the overhead, particularly when the economy is tight, of attempting to have an entire agency in house.
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10 QUESTIONS TO ASK AN AGENCY BEFORE GETTING IN BED TOGETHER
1. Who exactly will be working on my account, and exactly what will each bring to the table? 2. Exactly what rates do you charge for your services and are there markups on deliverables? 3. Are you an accredited member of any industry associations. If not, why? If yes, which ones?
AGENCY OR IN HOUSE?
ABOUT THE AUTHOR Rodger Roeser is an APR accredited member of the Public Relations Society of America and served as the Cincinnati Chapter President in 2005. After serving with the Cincinnati chapter since 1999, he returned to and is currently a member of the Cleveland PRSA. Roeser is the president of integrated public relations and social media firm The Eisen Agency, and is the host of radio talk show That Marketing Show and television news magazine Business Focus. A professional journalist by trade, Roeser was an award winning radio and television reporter and anchor, and an award winning newspaper reporter and, later, editor. He continues to write for a number of local and national publications. He also gives of his time to a variety of worthwhile community causes including The Brighton Center, Cincinnati Therapeutic Riding & Horsemanship, and the Cincinnati Police. He also founded the The Eisen Agency Scholarship Fund which provides an scholarship dollars for minorities pursuing a degree in public relations, marketing or journalism. He can be reached at email@example.com.
4. How do you invoice a client?
5. Does your agency lock my organization into a contract? 6. Do you outsource any of your services? If yes, exactly which ones and why? 7. Give me a list of your current clients and their average annual billings.
8. Show me examples of ways your agency promotes itself through advertising, social and PR. 9. Do you understand and are you familiar with current technology? Can you type?
10. Who is the editor of (insert main trade publication for your industry here).
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