When head of a digital unit is faced with a question “should we outsource?” A lot would depend on his decision; it will have an impact on profitability to scalability.
Online marketing including PPC, SEO, digital analytics, SMO/SMM etc. are only becoming more complexed, refined and advanced. Also keeping up with the pace of change is another challenge that companies face – skill/domain expertise. On the other hand, many companies outsource some of the repetitive and time consuming tasks which they feel requires less of expertise and more of time.
Considering the above it is clear that outsourcing is beneficial to companies which lack and want to have efficiency in regards to cost, time, expertise etc.
Let us consider some of the reasons why companies outsource
In-house skill deficiency
This is the type of issue faced mostly with small companies. Different resources with specific skill sets are required to manage such projects as one person cannot do everything. Each of these mediums are complexed and domain expertise is crucial. Even if a company wants to develop in-house skills it would take time to acquire such expertise. Apparently the size of your business would be crucial in directing whether hiring in-house would make business sense or not.
Outsourcing in this case looks like a lucrative option as investing in hiring resources for SEO, social media, analytics etc. would not make sense for a small company with just a few projects.
Too time consuming
A lot of work that’s repetitive or time consuming such as submission, link building, simple excel reports, keyword research etc. outsourcing them would make sense. Again the size of your business, current and projected future workload will determine that you should have a dedicated in-house resource or not.
By outsourcing you save time which you invest in other crucial jobs like business development and client servicing. Hiring an expert vendor to do a particular job can be more effective while you concentrate on what you are best at – a win-win proposition.
Lack of in-house tools and technology
As SEO, PPC and Social media become complicated so are the innovative tools assisting advertisers in managing their digital online campaigns. There are hundreds of free and paid tools available online which do complicated audits, analysis and provide you with valuable insights. Managing these tools to provide effective & beneficial outcome is a crucial job in itself. Obviously the cost incurred on these paid tools need to be seen in the light of current work load, expertise to handle them and finally cost effectiveness in having such tools.
When you outsource you are free from the cost liability and “who will manage these tools?” related worry. Your outsourcing vendor takes care of everything from providing complicated audits to high-end analysis and reports.
The baseline of all business is profitability so you need to see the fixed and variable cost while doing it in-house rather than outsourcing. Couple of years back I read a very good article in Forbes which I think is still very relevant. In this the author wisely explains that the cost of hiring a good SEO with decent experience would cost a minimum of $80,000 which can go up to $150,000. He further goes on to explain that even after hiring the employee it may not be enough as running a successful online business would need 2-3 individuals. Thus the overall cost of maintaining a quality team can run from $200,000 to $300,000. So keeping this in context it needs to be seen how beneficial is having an in-house team for your company? Also we need to understand some work are cheaper to outsource than to do in-house.
Today if you Outsource SEO projects the cost may vary depending upon the kind of partner/quality of work you are looking for, usually if you go for really cheap deals the worry is you may end up getting cheated. So thorough understanding your requirement look for a genuine good online marketing company.
Up to date on best practices/domain expertise
At times you may have had the expertise but gradually your understanding of the subject matter becomes obsolete. Keeping up with the best practices requires time and dedication which may include participating in training, forums and reading different online journals, blogs on regular basis. Participation in seminars and SEO events are really expensive deals also elite membership of recognized associations like SEMPO, DAA cost a bomb. This is apart from the cost that you will incur in paying salary and other employee benefits.
Performance based projects
It’s much easier to terminate contract and change your outsourcing vendor than to do the same with an employee. With an outsourcing vendor targets based on ROI, conversion, traffic etc. can be set and evaluated periodically and if you are not satisfied you can always replace the agency with another. The same is not the case with an employee, things become tricky, also finding a new resource is easier said than done.
With having an in-house team scalability is always an issue, let me tell you why. You won’t hire an employee until you are certain that you have sufficient work for him which would mean work for kind of skills (SEO, PPC etc.) he has. Also you need to keep in mind that in near future there will be a continues flow of work for him. This is a big constrain for a small and mid-sized company because you cannot hire an expensive SEO specialist if you have one or two related project. The reason would be obvious it may end up being a costly deal overall.
This is not the case in outsourcing, you can push as many projects as possible to the vendor. Capacity building, hiring and maintaining employees is their headache and if you think this may affect quality then hold on, before starting any project as mentioned earlier you mutually agree on certain set goals for each projects. The benefit of performance based project is that at the end the vendor needs to show the performance!
Having discussed why companies outsource now let’s discuss what are the tasks/work they outsource. Apart from outsourcing complete online marketing projects, partial projects/individual tasks are also outsourced commonly.
Tasks that are commonly outsourced
• Content Creation – one of most outsourced task in recent times has been creating content. This includes web content for landing page/website pages, article, press release, guest blogging on behalf of the company etc.
• Back link creation – this is done mostly as part of off-page SEO strategy and include directory submission, PR submission, article submission, one-way paid link creation by getting links placed in authority websites etc.
• Keyword Research – a partial task which is usually outsourced because its tedious and time consuming. A set number/group of targeted keywords is asked for with required traffic details.
• PPC campaign setup – just setting up campaigns would again be considered a partial job which excludes ongoing campaign optimization and maintenance.
• Link Cleanup – identifying and disavowing spam links that are pointing towards your website.
and the list continues…
So yes there are a number of benefits in outsourcing, especially for small and mid-sized companies. The monthly management fee is fixed and comparatively low, you can also choose vendor based on your budget. Then there are SEO reseller and PPC reseller programs specially meant for online marketing agencies. Thorough these programs the vendor provides white label/private label SEO and PPC services to the agency. This would form a topic in itself and will be glad to discuss in another piece sometime soon.