There is no right or wrong solution, only what structure helps you most effectively grow your businesss.
As your home product manufacturing company grows, it’s common to debate whether you should partner with a marketing agency or build an internal marketing team. And, in either case, the wrestling continues with when and whom to hire internally.
Key Factors to Consider
There are three key factors to consider: your role, your channels, and your revenue.
The Pros and Cons of Hiring a Marketing Team
Review some of the ups and downs to of building an internal marketing team.
The Pros and Cons of Partnering with a Marketing Agency
Review these pros and cons to see if hiring a marketing agency is right for you.
Key Factors to Consider
Your Role & Strengths
As leaders, it’s often to best to hire outside of our strengths.
If you have time and marketing is your strength, your marketing hires may come later for your business.
If your strengths and time are better utilized in other areas of business, marketing hires may make sense earlier.
Your Channels
Marketing distribution channels and sales strategies also influence when and whom to hire for marketing.
For example, OEMs and direct sales manufacturers require more lead generation.
In contrast, channel or indirect sales manufacturers tend to put more effort into product marketing and communications (like branding, sales support, and PR).
Other manufacturers use a hybrid sales model that combines direct sales to consumers with indirect sales through distributors or resellers. In this case, marketing plays a more significant role — responsible for generating leads and supporting sales channels.
Your Revenue
Your company’s revenue, net profit, and growth goals also play a role in determining the right path for managing your marketing.
As a manufacturer, your marketing needs differ from retail stores or SAAS companies, so having some guidelines can be helpful. However, keep in mind that even within manufacturing, every situation is different.
$0 - $3 Million in Revenue
Hire one or more freelancers at the lower end of this range – especially if you’re gifted in marketing strategy. While this solution will require your time to manage marketing contractors, you can grow with less overhead. If you are too busy or marketing is not your strong suit, partner with a marketing agency to work with you on strategy and let them handle all your marketing execution.
$3 - $10 Million in Revenue
If your products have a low ASP (average selling price), you’ll do better to partner with an agency that focuses on your industry. You can leverage their knowledge and experience to create and execute your strategic marketing plan. As you reach the top of this range, consider hiring a marketing manager to work directly with your marketing agency so you don’t need to be as involved with marketing execution.
$10 - $20 Million in Revenue
Consider adding a Fractional CMO (Chief Marketing Officer) that fits between you and your Marketing Manager. This hierarchy frees up more of your time and allows your marketing agency to work strategically with your CMO and tactically with your Marketing Manager.
There may also be specific internal hires that make sense, depending on your strategy. For example, suppose social media plays a significant portion in your marketing. In that case, an internal hire can work with your agency to more cost-efficiently produce social content that aligns with your brand guidelines and over-arching strategy.
$20+ Million in Revenue
A hybrid marketing team is typical at this stage. Your direct report (often a CMO or VP of Marketing) manages a small internal team with specialized skills along with your marketing agency partner.
The marketing agency provides a breadth of marketing skills and experience that are expensive to replicate with internal hires, while your internal team can be more efficient and flexible with daily marketing execution.
The Pros and Cons of Hiring a Marketing Team
Pros
Dedication – This person or team is exclusively dedicated to your marketing, which can lead to more personalized marketing.
Access – An internal hire (or hires) is available on your schedule and may even be physically present in your facility.
Flexibility – In-house employees can quickly adapt to marketing needs – often essential with supporting sales channels.
Oversight – There is more control over setting priorities and monitoring progress with employees.
Cons
Limited Skill Set – In marketing, finding a “unicorn” skilled across marketing disciplines is difficult. Hiring a person for a small set of skills is more common.
Higher Costs – With employees, their cost extends beyond their salary with benefits, equipment, training, insurance, and more.
Dependability – Turnover happens, and that can leave gaps in your marketing efforts that negatively impact your brand and sales.
The Pros and Cons of Partnering with a Marketing Agency
Pros
Broad Skill Set – Get access to an entire team of specialists who are continuously trained and experienced in their trade.
Low Maintenance – Once an agency understands your business and goals, meetings get laser-focused on strategy and results.
Cost-Effective – When partnering with an agency, you’re paying for time and results, bringing your costs for results down.
Cons
Other Clients – Various deadlines across agency clients might sometimes mean waiting.
Learning Curve – Even a marketing agency focusing on your industry will require some time to know your business.
About the Author
Jason Otis is the president of Perk Brands and founder of Built for Home. Perk Brands is a digital marketing agency that partners with home product manufacturers to make their products easy to find and buy. Built for Home is a community of home product manufacturers and a resource for buyers to find products that make their lives better at home.
