In many aspects of business, no matter the industry you’re in, you tend to see cyclical trends. The pendulum swings one way, then it swings back. Take marketing. Recent years have seen a trend toward brands bringing various marketing functions in-house, whether it’s programmatic media, creative, data analytics or technology. But now, that pendulum is swinging back. Look out for the tide turning in 2019. We’re seeing outsourcing of the marketing function on the rise again. Why is it happening? And is it the right thing to do?
It all starts with data—the undisputed king of, well, everything. The rise of AI and machine learning means marketing can understand who the customer is, what they’re doing, and what their desires are, so that companies can hit their customers with just the right offers at just the right time. But it’s getting a little more complicated than that.
Marketers, whether in-house or outside, need to be thinking about leveraging all of that data to do a better job of offer management, providing and enhancing the customer experience—the whole nine yards. But, the art of using that data may be changing. A little thing called GDPR swept over Europe like a tidal wave this year, and similar themes are making their way across the pond. It’s making things more difficult for in-house marketers not only because the customer data free-for-all is grinding to a halt—Facebook breaches, credit card breaches, even Alexa listening in on our conversations are making people extremely data-sensitive—but there is no one standard for data privacy in the U.S. right now. States are enacting laws and regulations on their own. So marketers need to be aware of the differing laws and do it one way in California, one way in New Jersey, another way in New York, and so on. Federal regulations seem to be a heartbeat away. Are we going to see a HIPAA-like regulation for customer marketing data? It just might happen. But one thing is for sure—you need people on the marketing front lines to make sure you’re playing by the rules.
It’s the transparency that’s important here, and we’re seeing a greater push for it. Technology companies, data companies and agencies are starting to recognize this.
Not to snarl the issue further, but there’s also the matter of the job market to deal with. You may want to bring your marketing back in-house, but it’s not as easy as that. You need the technology to do it, and you need the people. Especially if you’re in a competitive market like New York, Austin, or San Francisco, recruiters can feel like they’re playing the Game of Thrones to fill key positions, especially in marketing. Data analytics is among the most sought-after skill out there right now, as is experience in social media and digital marketing. Assembling an in-house team with that breadth of experience is a challenge.
Another challenge is—once you find and hire great people for the job, how are you going to retain them? What is their career path going to look like? You need people who are going to run events, search campaigns, and manage data on an ongoing basis but, according to Forbes, the average tenure for a CMO is 44 months.
Which brings us back to the outsourcing versus insourcing question. There are pros and cons to each approach.
- Pro: Agencies are on the leading edge of marketing trends.
- Con: They don’t know your business as well as you do.
- Pro: If you don’t like the results, you can simply move on.
- Con: It can be a costly in time and money to agency-hop.
- Pro: You can focus on your business, not marketing your business.
- Con: Agencies aren’t focusing solely on marketing your business, they have other projects, too.
… Versus insourcing
- Pro: Expert marketing pros on your payroll.
- Con: Assembling that team from the ground up will cost you, in time and money.
- Pro: Your marketing team can dive deep into your brand.
- Con: After a while, they might not see the forest for the trees.
- Pro: Urgent, last-minute jobs won’t cost you a speed premium.
- Con: You need to worry about your team’s work-life balance.
What’s the solution? We’re forecasting a shift back toward outsourcing, with third parties (including tech and data companies like Deluxe) offering more measurable, accountable, flexible services. The key is striking the right balance between outsourcing and keeping some functions in-house.
Financial institutions need data-driven marketing that achieves superior ROI and turnkey solutions that encompass data, analytics, technology and marketing execution. Whatever your priority, whether it be loans or deposits, consumers or small businesses, third-party marketing pros have the data, insights, strategies and execution capabilities to make it happen. Visit us here to learn more.