agency vs. freelancing vs. in-house marketing teams

It is with a heavy, but inspired heart, that I’m choosing to write this piece.

We had been blessed enough to retain our agency’s clients in the two years the Blend Social Marketing has existed. I really pride myself on that. I have always felt that it is your first and foremost responsibility in any job to find some way to add value to a company through your personal skill set.

I landed my first internship this way. I was brought on for one purpose, but I continued to find other ways that my skills could be of use to the small company I was working for and was kept twice as long, with pay, only until I found myself a new position.

I bring that same philosophy to new positions and clients. If the answer to “can I help you” is no – I recommend other solutions to a potential client.

I received my first contract cancellation in two years last week. The client was worried that our team would be upset about the cancellation – and our team surprised them.

You see working with an agency or working as a freelancer, you cater to a very specific kind of client – a client where freelancing or outsourcing your marketing or digital activities just makes sense.  Blend caters to small-to-medium size business, brand launches and start-ups. It’s usually the case that the client cannot afford to pay a full-time salary to hire a marketer in-house, and thus seeks the help of an agency or freelancer to contract part-time hours for crucial tasks to help grow their marketing.

Often new companies are one to two people passionately pursing an idea and looking to network with those who can help them grow, without needing large sums of cash. This is the value that freelancers and agencies can lend to new business.

Though we were heartbroken by the cancellation – we knew that the client and needs had simply outgrown a freelancer or agency and professionally wished them continued success and growth.

If you are thinking about what makes sense for your organization from a marketing perspective, consider the following benefits and drawbacks of Agency vs. Freelancers vs. In-House Marketing

Agency PROS

  • Rich, creative thinking that is usually the result of more than one person, including senior executives. Group brainstorming can yield more creative ideas
  • An entire marketing team and support team.
  • Deep expertise, knowledge and experience
  • Access to otherwise expensive resources. Pricing out certain tools for one client gets expensive, but using the same tools for multiple clients allows a company access to a certain tool at a reduced cost (or free.)
  • Part-time salary spends. It can be hard to hire an experienced employee part-time. Even with overhead to consider, many agencies can still offer great pricing for small businesses that would rival hiring a part-time or full-time employee with as much expertise and creativity.
  • One of the great benefits I had seen from working at an agency was pulling connections together for clients – helping to reduce costs while still doing cool things. At a previous agency, we had pooled resources from two major clients to create the joint Valentine’s Day campaign “Fit Girls Don’t Like Chocolate” – splitting costs between clients for added value.

Agency CONS

  • Speed was always relevant when you add multiple people to a team. Decision making does not stand with the individual, rather with a superior – so decisions can be slower. Likewise, sometimes to answer fairly simple questions requires a lot of communication since it is not centralized within one individual.
  • A bigger team and more overhead mean more bills and salaries to pay. Though this can still fall within a reasonable range with immense value, when compared solely to a single freelancer, agencies tend to be priced at more money per hour for services.
  • Compared only to in-house employees, agencies will require a commitment to constant communication. It is the only way in which you will have a sense of your marketing practices, as most agencies will operate remotely from your company. Even if you are in the same city.

I recommend agencies for those who want to level-up a good foundation of existing marketing practices holistically. These clients have already seen some success with either a freelancer or part-time worker and want the structure, expertise and tools of a larger company and are willing to make an investment.

Likewise, I recommend agencies for a specific program or piece of marketing in which you do not have the capability or resources to do in-house. I see this often with influencer marketing – where many companies simply do not have the bandwidth to pull off a successful campaign in-house and therefore seek the help of an more experienced agency with the tools and resources that can provide a better return on investment. The same goes for PR firms with deep, established connections.

Freelancer PROS

  • Part-time salary spends. Freelancers are perfect for a growing team that cannot sustain the costs of adding another full-time employee. Compared to agencies, freelancers have lighter overhead and thus can generally provide more value-per-hour to growing companies.
  • Most freelancers operate as an individual or a team, meaning that they are the sole decision maker and require less time to retrieve information or make decisions, thus the speed of a freelancer tends to be higher than that of an agency (all other factors such as cost-level, equal).
  • Freelancers often have deep experience or knowledge on a certain topic and many have worked with major agencies, leaving to pursue a more flexible lifestyle. Their expertise can often be priced lower than with an agency.
  • Because many freelancers have held former prestigious positions, many have deep connections to other clients and an extended network of colleagues and contacts. The price of these connections tends to be lower than hiring an agency.
  • Rich, creative thinking. You may be asking yourself how this could be a pro, when I previously referenced the creative thinking produced by a TEAM. To be honest, sometimes creative thinking is the product of just one individual. Freelancers tend to have less stress, deadlines and more space to come up with creative ideas. Though teams can produce great ideas, so can creative individuals.

Freelancer CONS

  • Freelancers are humans. We tend to have tragic things happen to us that put us in the hospital at 4am. We take vacations for our sanity. The difference being that, when you are with an agency, there are other teammates to fill in. Freelancers do not have this luxury.
  • Freelancers operate independently, and while that means lower overhead and therefore some savings, it also means less access to expensive resources or limited access.
  • Similar to agencies, freelancers will require a commitment to constant communication. It is the only way in which you will have a sense of your marketing practices, as most freelancers will operate remotely from your company.

I recommend utilizing freelancers for a growing company or a larger company that needs temporary help for a campaign, project or time period. Freelancers are the most inexpensive way to add part-time man power to your team and allow you continued growth without an outstanding investment. Learning curve is often quicker than an agency – as you are dealing with training and coordinating one individual as opposed to an entire account team. Freelancers can provide high-value at low(er) costs.

Most freelancers are experts in what they do – and they do that one thing they do well, REALLY well. So if you are looking for more consultancy, direction, advising and customization, freelancers are also a great choice. As the nature of work is changing more “partnerships” or “collaborations” are taking place, allowing minds to connect and work on ideas, lend expertise and overall work together to make something great – even if that is not something that is “permanent”.

In-House PROS

  • Supervision. This is a given, but also because it’s so obvious, it’s also overlooked. The greatest benefit of in-house employees is that you can keep a close eye on the work being done and be directly involved with the daily day-to-day on-goings of the employee. Daily reporting and emails add time to a freelancer or agency’s “bill” and therefore are not always efficient – so if you must know and control what is going on closely, an in-house employee is the best option.
  • Cost-savings. There can be cost savings to in-house work, but be careful in how you are comparing and make sure that you are adequately comparing skill levels, need and hourly wages. Overhead costs, health care and other expectations quickly drive up the actual cost on top of salary.
  • An entire marketing team and support team.
  • In-house, decisions can be made faster and require less time to retrieve information or make decisions about proceeding.
  • Yes, Skype is nice, but nothing will improve the relationship between a marketing team more than true Face time. While it’s not a necessity these days to complete work and build a great relationship, I have never encountered a situation where my relationship with a client had not improved due to the ability to meet in-person. In-person contact is higher when employees are hired in-house, more so than freelancers and agencies. The “con” of the freelancer and agency, but the “pro” of the in-house employee. Communication can improve greatly when you share the same office space with your marketing team.
  • The only scenario where you are not being shared among other projects and clients. In most cases a full-time employee is 100% dedicated to you, the job and the company for 8 hours a day.

Don’t be fooled by the pretty PROS list. Speed, Communication and Facetime all seem like win-win situations, but the truth is, so many companies are so “busy” or so “structured” or so “vertical” these days, that they don’t really reap the benefits of all the pros. If the only communication you have with someone who works under the same roof is still email or phone – what good does it do you to have them in-house? Often times in these situations, companies would benefit in terms of value for experience or from reduced overhead costs or health care costs, working with an agency or freelancer.

In-House CONS

  • Though a pro for those working with multiple projects or clients, resources for an in-house employee like software and tools.
  • Training, vacations, healthcare – as note above they can quickly add to the “true” hourly wage of an in-house worker. What about true costs of supervisory and management of a new employee? There are costs to the entire business with the addition of a new employee. Though most agencies or freelancers will account for some of these business expenses in their price to you, it is more than likely these costs are being shared and therefore less when comparing apples-to-apples.
  • Expertise/ Competition. Simply put, the higher the quality of talent, the more you will pay for an in-house employee. And though this can mean great things for your company, the same level of expertise more often than not, costs less coming from an agency or freelancer. This leads to many skills gaps as well, as often times, all skill sets are not covered by an in-house marketing team.
  • Lack of outside perspective. Compared to agencies and freelancers, your own employees know “what works for you” – and the longer they stay with the company, the more far removed they are from outside perspective and experience. Some researchers refer to this as the “Island Effect” – in-house marketing employees are further away from the actual “marketing” industry, though closer to the industry of the employer.

In-House employees are traditional! So if you are a traditional brick-and-mortar business, or you are funded as a traditional business, setting up payroll and adding in-house employees not only makes sense, but is an expectation.  Even if part of your work is outsourced to an agency or freelancer as you grow (or even downsize), having a marketing team in your office among all other business areas and functions has many advantages.

I also recommend in-house employees when you want dedication, talent and commitment – someone or multiple people who are 100% focused on your growth as it is correlated with their individual career growth. Proactivity, taking on work outside their individual job description, these are things that will be maximized hiring someone in-house and paying their full salary.

What other PROS/CONS do you see of agencies, freelancers and in-house employees?