Should You Outsource or Insource Your Marketing?
An insurance company’s marketing budget can easily get spread thin. After you cover all aspects of marketing, there isn’t a whole lot of room left in the budget for specialized staff, data research, or software and analytics programs to help make a modern marketing campaign successful. This lack of budget is just one reason why a company might choose to outsource part of their marketing, but it may not be the right fit for every organization. This article will help you determine if you should outsource marketing and, if you do, how to get the most out of it.
Marketing Outsourcing Options
Outsourcing is a big decision, but so is hiring new employees and acquiring all the right resources to optimize your marketing. The good news is that outsourcing marketing comes in a variety of forms, so you can make the choice that best fits your organization.
The outsourcing routes you can take are:
- Outsourcing all your marketing in full
- Outsourcing none of your marketing and keeping it in-house
- Outsourcing some of your marketing but keeping some in-house
Each option comes with its list of pros and cons, and the right choice for you will be determined by your company’s specific situation. If your company has its digital marketing perfected but hasn’t ventured into traditional or more direct forms of marketing, this might be a good area to outsource. Even if you currently have an in-house marketing team, marketing is many pieces, so specializing in every piece of it is difficult, expensive, and incredibly time-consuming.
Can You Trust a Third-Party Marketing Company?
Many insurance companies struggle with deciding whether to outsource because bringing in a third party requires a level of trust and efficiency that may be difficult to achieve. Choosing the right third-party marketer (TPM) is possibly the most important part of outsourcing marketing.
Asking the marketing companies you are considering some specific questions will help you decide if they are a trustworthy choice for your organization.
- Do they have the data? – Data is crucial, and that is even more true for insurance companies where numbers are king. Make sure the marketers you are talking to utilize data throughout their campaigns to determine the success of each campaign but also that they use that data to adjust future campaigns to increase the ROI. Many third-party marketers use analytics on some level, but you will want to work with one that has data experts, such as data scientists, who process and read the data to use it to your advantage.
- Do they have insurance marketing case studies to prove success? – Like data, case studies include the numbers to back up their success claims, but they also include the stories that will help you understand where the company was at when they started with the TPM, the process it took to help them improve, and why those growth numbers were so good. These will help you determine if they are the right company for you, because if a company has had multiple successes with other insurance companies like yours, chances are they can be successful with your organization as well. On the flip side, if a TPM’s case studies show successful campaigns with multiple non-insurance industries, it won’t necessarily translate to success in a role as a third-party marketer for your organization.
- Are they compliant? – Insurance is one of the most compliance-regulated industries in the country. This means that the third-party marketer you choose must have their compliance ducks in a row and do their due diligence, as well as ensure all your content and marketing materials are compliant according to state and federal regulations. Not having compliant marketing can hurt an insurance company, so this is one question you can’t afford not to ask.
- Do their strategies fit into the present times? – Marketing strategies are constantly changing, but only some are good enough to survive long-term. While third-party marketers will all do things a little differently, they will need to back up their strategies with current results. For example, doing email marketing alone may have worked years ago before the area was saturated, but now an omnichannel approach is necessary to make sure you are reaching your target audience where they are. If a TPM is stuck in the ways they were doing things before, they may not be giving you the best results because they believe the old ways will still perform just as well as they used to—with no data to back it up.
When You Should Outsource Your Marketing
As long as you can find a third-party marketing company you can trust, outsourcing can be a great option. Some considerations need to be made to decide if outsourcing is right for you.
Your Organization’s Bandwidth is Dwindling
If you find that your current marketing department is struggling to add new campaigns or manage the campaigns they have, it might be time to outsource to a third-party marketer. When you see that the bandwidth is dwindling in your organization’s in-house marketing department—however big or small it might be—that is usually when you start looking for other solutions.
Hiring a new employee is an option, but when you are looking to encapsulate as much marketing expertise as possible, it’s difficult to find that in just one employee, and when you do find it, it tends to be expensive. One option for your company could be to open a few marketing roles to cover the basic areas of marketing expertise. If you choose to offer new products or new tactics as part of your marketing strategy, such as direct mail, you might want to consider outsourcing instead.
If your organization has the budget to start initiating large marketing campaigns, in-house marketing might be your best bet, but keep in mind that it is more than just the cost of the employees you will have to consider. Ensure the budget covers all resources and aspects of your marketing strategy before making the final decision.
Lacking time and resources is an issue most insurance companies struggle with, and these issues shouldn’t lead to less revenue or ROI—and it certainly shouldn’t inhibit marketing innovation.
Obviously, this issue is made even worse if you don’t have a large in-house marketing department. The handful of employees responsible for the entire scope of your organization’s marketing can’t be expected to be experts in every marketing method, nor can they possibly have the time to plan, initiate, analyze, improve, and learn all at once.
Outsourcing allows employees to be more productive by ensuring they can focus on their current tasks without trying to handle more than they have the time or resources to handle. Plus, their level of efficiency increases since now those employees can do the work they are experts at while the third-party marketing company handles the other work.
Data and Experience is Expensive
For most companies, adding an entire department with the resources and expertise to collect and manage data while turning it into improved future marketing campaigns just doesn’t make financial sense. With the additional data and experience a TPM has, campaigns and expertise can be much more robust. According to Marketing Evolution, “Data-driven marketing increases ROI, with campaigns that leverage data-driven personalization reporting 5-8x ROI for their campaign spend.”
Having the right data and knowing how to use it can make or break a marketing campaign—and the revenue you collect from it. Knowing what works and doesn’t work takes all the guesswork out of marketing, which in turn gives you better results for your money.
The level at which many TPMs utilize data is significantly higher than what would be affordable or logical to have in-house. Insurance marketing companies like FM Engage have an entire team of marketers, insurance experts, and data scientists who work together to get the best possible results from all marketing channels.
Cost of Marketing In-House is Too High
Marketing departments are expensive to hire, train, and implement, especially when taking into consideration the number of individuals you need to have the right level of expertise.
Direct marketing takes more tools, time, and knowledge than other types of marketing. Add in the resources it takes to provide data-driven direct mail services, and marketing in-house may become unaffordable or unreasonable for your organization.
Additionally, in the current employment market, hiring is becoming increasingly difficult and more expensive, and if you do manage to find the right expert fit for your team, you put yourself in a position where there is no continuity should that person decide to move on to a new company. This is a big risk and can cost your organization even more money in the long run.
Outsourced Marketing Complements Your In-House Team
Marketing is a lot of moving pieces and parts, and it is not just one thing—it is a broad term that covers all promotion services and includes everything from social media posts to analytics to market research and advertising. This is why marketing departments typically include multiple segments, such as digital and content marketing, advertising, and direct mail.
When choosing what to outsource, it may make sense to outsource the most complex and expensive parts of marketing, such as direct mail and data-driven marketing, while allowing your team to handle everything else.
When You Should Insource
Outsourcing your marketing isn’t always the best option for every organization. Some insurance companies will decide that using their in-house marketing makes more sense for them.
Insourcing might be right for your insurance company if:
- Your company has the resources to insource, including a current robust marketing team with strong omnichannel knowledge and the tools they need to handle digital and traditional marketing.
- Your company has a data source and team who can collect, analyze, and utilize the data to better your marketing ROI.
- Your internal team has the bandwidth to give each product and strategy the attention needed to succeed.
Keep in mind that some of these may be true for your organization and some may not be, which is why it’s often best for companies to evaluate and insource some marketing for which they have the resources while outsourcing the other parts.
Data-Driven Third-Party Marketing for Increased ROI
FM Engage can step in if your organization has decided it’s time to outsource. With over 50 years of experience in the industry, we know what insurance companies’ biggest challenges and goals are and have extensive data and data scientists to constantly ensure improvement of ROI and campaign effectiveness.