Outsourcing Marketing Services

The Benefits of Measuring a Successful Strategy

Do you want to increase sales? Do you want to control your marketing cost?

In today’s unpredictable economy, companies are trying to find new and innovative ways to keep the marketing momentum going and growing, while dealing with budget cutbacks and dramatic fluctuations in the market. Smart companies know that they can’t stop their marketing activities – especially if they plan on establishing long-term value in their business. So, where do they turn when marketing is necessary, but resources, expertise, focus, and funds are scarce? They find the answer in outsourcing marketing services. Companies can realize the following benefits with outsourcing marketing services:

  • 15 – 25% sales revenue gains
  • 25 – 35% decrease in salaries plus overhead costs
  • 10 – 25% decrease in overall marketing spending
  • Access expertise in marketing strategy and implementation, as well as creative design, focused on the specific job or project at hand
  • Get an outside perspective on your business
  • Minimize the impact of marketing staff reductions
  • Draw on outside experience with “what works and doesn’t work” scenarios
  • Maintain the momentum with critical projects – they’ll never fall to the wayside, drop down the priority list, or become forgotten
  • Hire only whenever and wherever you need resources – “on demand”

Why choose marketing outsourcing?

1. Companies can achieve by applying an outsourced strategy to their marketing needs. Given that the human capital and staffing model has changed and outsourcing is gaining increased acceptance as a standard business strategy, we believe that marketing outsourcing will be adopted by more companies in the upcoming years.

2. Data from SurePayroll small business customers, shows the percentage of their employees who are independent contractors has grown 85 percent from May 2007 to May 2012, rising from 3.33% to 6.26%.

3. Leading companies at the forefront of outsourcing have been in the technology sector however, this model has shown significant value for broader industries. The spread to other sectors are driven by three main factors:

a. The trend has shifted from the marketing department using outside partners for projects, to the boardroom. It has become a proven business strategy that gives a company a clear competitive advantage.

b. Evidence of the effectiveness of outsourcing will continue to grow, raising the comfort level of top executives in any industry to use this proven, affordable approach.

c. Organizations are more focused on core activities--that is, things that contribute to the company's competitive advantage and increase shareholder value. The opposite of core is context--activities that do not contribute to competitive advantage. Context activities should be outsourced.

WHAT IS THE STATUS OF OUTSOURCED MARKETING SERVICES?

In today’s business climate, CEOs and executives are cautiously optimistic about the economy and their company’s future growth. They realize they still need to market to drive profitable growth and increase their company’s value, but the financial strings are being tightened.

Most people believe that keeping everything internal will lead to greater efficiency.

There is a clear growing trend, however, for companies, regardless of size or industry, to outsource (which used to be referred to as sub-contracting) this is just another element of their business. Outsourcing is not a passing fad, but clearly a paradigm shift that can change a business model for the better by using resources outside the organization to perform specific tasks.

This increase is largely driven by just how easy it has become to find companies and people with specialized skills. technology and the Internet have made it efficient to search out people to do the tasks you struggle to do yourself. Harvard Business School professors Gail J. McGovern and John Quelch documented the trend in an article in the March issue of Harvard Business Review.

One reason behind the move? While company marketing departments have plenty of talented right-brain, creative types, they may lack the left-brain analytics needed to better understand their customers in today's information-rich environment.

Companies often forget to ask the basic question: What business are we in? Too often the need to perform various functions and to keep a business running does not allow management to step back and ask this question. The answer should bring management to the fundamental product or service that generates revenue for the company.

Outsourcing marketing services allows businesses to focus funds and control head count, allowing a company to hand over responsibility for an outsourced function within clearly defined management guidelines and then monitor future performance. When you break down the costs of a full marketing department internally, versus the cost of outsourcing marketing services with an external partner, the business case becomes clear.


In a real-world example, a company can see a 15 – 25% revenue improvement in the first year and a 25 – 45% cost savings is immediate. Other benefits that make this a compelling case to look at are:

Lower cost

Instant Availability

Talent and experience

External Objectivity

Agile Flexibility

Speed

The trend in marketing outsourcing does not look like it will slow down anytime soon given the stalled pace of hiring in this soft economy.