To carry out an effective purchase of marketing services, you need to be well versed in the suppliers of such a “product” and their assortment policy
There are three main types of customers for the services of marketing agencies within the company. First, owners or directors – this is a common case in micro and small businesses, as well as when dealing with strategic issues. Secondly, functional managers / responsible persons in the field of marketing and sales. Finally, the third option is when the ordering of services is carried out by specialists in the field of procurement, which, as a rule, is associated with the regular purchase of services that are relatively standard for a given company (usually a large one) on the basis of outsourcing. Each type of customer is guided by its own considerations and logic when choosing a service provider, which does not exclude the importance of a comprehensive understanding of the marketing agency market.
Why is it hard to compare marketing agencies to in-house marketing?
The question of selecting a marketing agency to perform a certain task (like a project limited in time) or assign a certain marketing function (as a regular activity) arises as a result of an internal need for a company, which can be expressed by both the head of the enterprise and the first person in marketing. However, in any case, first of all, the possibility of satisfying such a need is considered at the expense of the company’s internal resources, which can be either available or purchased in the labor market for a new direction of activity or project.
Hence, objectively, the task arises of comparing two solutions with each other – to outsource the marketing function or to expand the staff of the marketing service (to increase the load on existing employees).
The seemingly simple economic task of calculating and comparing two “efficiencies” turns out to be very nontrivial in practice.
If we make a simple intersection, then four variants of the situation emerge:
- project task – the workload on the staff increases,
- the task is the project – an employee is hired to the staff,
- the task is regular – the workload on the staff increases,
- the task is regular – an employee is hired by the staff.
There are also combined options, but it will not complicate the already difficult task of choosing too much. At the same time, remember that with efficiency, both costs and results must be considered. Let’s start with the costs.
The easiest way is to compare the cost alternatives for solving the problem on our own and by attracting an outsourcing company in the second and fourth options – by calculating the cost of marketing agency services and remuneration of newly hired employees (s), taking into account all tax payments and deductions (for example, if the service provider , as well as the customer, work according to the general taxation system).
With an increase in the workload of existing full-time employees, especially within the framework of a project task, it is much more difficult to compare costs, since accounting for the workload of workers in Russian companies is often not very high-quality, and in the case of a project (temporary) workload of an employee, it is also unclear how to correctly organize a constant change of tasks and their correct intersection with the rest of the activity. Provided that the volume of the current workload of marketers is often very indirectly related to the level of their remuneration, it is problematic to ensure the comparability of cost calculations.
But when comparing the effectiveness of two solutions, it is much more difficult to calculate the expected result, which is often difficult to quantify at all. More or less accurately, you can predict the return from an existing full-time employee or from a marketing agency with which work has already been put on stream. When we talk about attracting new employees or outsourcers, the opinion about their effectiveness is formed rather expertly or intuitively.
As a result, the comparison of options for attracting a marketing agency or working with your own is rather arbitrary. Therefore, the choice of this or that option lies more in the field of intuition and managerial experience of decision-makers.
Why is it difficult to compare marketing agencies with each other?
After passing the first “fork”, the second one arises – how to compare marketing agencies with each other. In our opinion, it is necessary to start with determining that, with all the variety of such organizations, there are the most common types of them, suitable for various tasks. And, knowing what task we want to set for a marketing agency, it is worth looking for a contractor not in the entire market of marketing services, but in a specific segment, where the probability (but not a guarantee) of finding a suitable counterparty is higher.
The following does not provide any typology of marketing agencies that claims to be universal. Let’s talk about who the customers of marketing services encounter in the market more often
1. Advertising agencies.
Many marketing agencies in practice are advertising, which actually does not exclude the importance of advertising, as well as promotion in general. You just need to be clear about the fact that a good advertising specialist, like an agency, often cannot be used to effectively solve other marketing problems. It has become a practice that rare organizations working in the field of advertising speak of themselves as advertising companies. Most mimic marketing. Probably, this comes from the fact that in the understanding of many potential customers, marketing and advertising are about the same, but the word “marketing” seems to give more weight, sounds more solid. It is important not to pay attention to these formal signs, but to understand the essence of the organization that is considered as a service provider.
This includes marketing agencies that specialize in working online. If the main portfolio of the company’s services includes the development and development of sites, the organization of contextual advertising, seo-promotion and the like, then we are dealing with just this kind of marketing agency. As a rule, this type of marketing service providers do not try to present themselves as a performer for different tasks, clearly identifying their areas of responsibility.
3. Agencies engaged in quantitative research.
Quantitative research focuses on various dimensions of market processes, such as brand awareness or consumer preferences. Most often, fairly large companies operate in this segment, which have their own technologies for working with certain markets (specialization can be expressed to a greater or lesser extent), as well as a significant staff and an extensive partner network. Many of them are federal players and are well known to marketing professionals. Given the large capacity of the market, quantitative research rarely go beyond the boundaries of their segment, developing it and increasing their competitiveness through improving the proposed product.
4. Agencies engaged in quality research.
Qualitative research is designed to assess the development of the market and collect information about its conjuncture, which in whole or in part is not subject to formalization. Unlike the previous type, such agencies are rarely large structures, which is due to both the lack of the need to keep a permanent staff (non-standard tasks, irregular workload), and the predominance of the importance not of technology (which must be constantly serviced), but the professional level of the management (expert) staff … They can specialize in specific geographic or industry markets, but are more often highly versatile.
5. Outsourced marketing agencies.
They mainly work with small businesses (micro-enterprises) and take on the organization of the marketing process as a whole, including the selection and training of personnel to work in the customer’s staff. Often they are also involved in the development of sales in a complex, which is logical taking into account the main goal of marketing activities. In this environment, work without the formation of a legal entity is widespread – on the basis of individual entrepreneurship or under a civil law contract with an individual – a consultant.
6. Agencies of a narrow profile.
This includes a fairly large number of organizations that specialize in any narrow marketing function or technology. More often, such organizations do not try to somehow clearly associate themselves in the eyes of consumers with marketing activities. Examples include firms providing Wi-Fi marketing services or preparing customer participation in trade fairs.
7. Full cycle agencies.
A feature of this type of marketing agency is that they declare the possibility of providing a wide range of services within the framework of a single concept of work and interaction with the customer. Unlike the fifth type, here the marketing function is not taken outside, but remains within the company (often if there is a marketing service or a marketer on the staff of the customer), some universal marketing technology is not sold. At the same time, such an agency takes on a set of tasks for the development of the customer’s commercial activities. A high degree of versatility requires the performer’s competencies in various fields, especially the ability to conduct market research and implement tools in the field of sales development and promotion.