Congratulations! Your company has grown to the point that you really need to hire a marketer!
Don’t do it. Here’s why.
First, an assumption – any data presented assumes we’re hiring in Atlanta, since that’s where Audacity is based. The math will work in your area, too, but the gross numbers are likely to be different. (Hello, New York and San Francisco!)
Let’s decide what kind of a marketer we want to hire. Most small to medium businesses hire at the senior manager or director level, since that person is likely to have executed marketing programs in the recent past. We entered the following query into Salary.com.
- Marketing manager
- Atlanta, GA
- 5 years of experience
- Bachelor’s degree
- No direct reports
- Reports to senior management (since they’re the only marketing resource)
- Meets performance expectations (so, average)
According to Salary.com, competitive compensation for that person is $102,468 per year. That’s only the beginning. According to the US Bureau of Labor Statistics, the average employer burden in the south is 37%, which puts your overall costs at $140,381. Since recruiting is a one-time cost, we’ll not include it in this calculation, but a SHRM study estimates the cost of recruiting a new employee to be $4,129.
Your new marketer costs about $11,700 per month. What do you get for that? You have one person who is expected to fill all these roles:
- Brand manager
- Product manager
- Web designer
- Web developer
- SEO expert
- PPC expert
- Graphic designer
- Digital marketer
- Email marketer
- Market researcher
- Campaign manager
- Copy editor
- Social media manager
- Internal communications manager
- Public relations manager
- Conference planner
- Event manager
Those are just the basics. Within many of those roles are three to five subordinate roles. From day one, you’re likely to find the person you just hired is overwhelmed and can’t keep up with everything you need. You won’t get value from them, and they’ll burn out quickly. That might be why the average tenure of a marketing manager, according to Ad Age, is just 2.6 years.
What if I told you that $11,700 per month could buy you dedicated professionals in every one of the roles listed above? In fact, according to the needs of your company, you could probably get them for less?
Many small to medium businesses forgo even looking at a marketing agency relationship because they believe it’s too expensive, choosing instead to hire a single marketing person to do it all. But the math doesn’t work!
Smaller boutique marketing agencies provide high levels of service and expertise for a significant cost savings over a marketing hire. You want proof? I won’t name any clients specifically, but Audacity currently runs robust marketing programs for a number of companies for $5,000 to $10,000 per month. Even if you hit the top of that range, you still have the potential to save $20,000 per year by hiring an agency instead of a solo marketer. In addition to the $20,000 you’re bringing to the bottom line, you’re likely to experience higher growth. Deloitte’s CMO Survey indicates that marketing leads revenue growth at more than 38% of companies surveyed.
Consider also what happens if that solo marketer makes a mistake. What happens? What recourse do you have? Unless they’ve really screwed up significantly, they apologize and promise to do better next time. You still have to pay their full salary. With an agency, you have some additional recourse. If you’re not satisfied with some portion of a campaign, the agency may be willing to discount that portion of the service. It’s also easier to terminate an agency relationship than to fire an employee. We hope that you don’t have to deal with either of those scenarios, but mistakes do happen and sometimes they result in significant consequences.
If you already have that solo marketer, you have another opportunity – the opportunity to retain them for longer than the average 2.6 years by providing them high levels of support. While you’re not saving their cost, you’re saving the cost of recruiting, and you’re helping them elevate their marketing game, and drive your company growth.
As you make marketing and staffing plans this year, consider the cost, value, and convenience implications of hiring an agency rather than an individual marketer, or giving your individual marketer the resources needed to be successful so you can retain them. Print this blog post and hand it to your CFO as you make this determination.
It’s never a bad time to make the CFO happy. After all, they approve your budget and sign your paycheck!