The Marketing Paradox - Is Outsourcing the Answer?
by Nick Denroche

In today’s competitive construction market place business owners now have the option to outsource more aspects of their business than ever before. All businesses have to look outside the boundaries of their own company for expertise at some point. The most commonly outsourced services simply can’t be done in house by small businesses; insurance, accounting, and legal services are the most common. There are also certain jobs that seem to lend themselves to outsourcing more than others; answering services, specialized subcontractors, web design. With so many alternatives available it can become difficult deciding what’s best done in house and what you’re better off having done by outside professionals.

The main school of thought in selecting what to outsource is to determine what your business excels at, the main reason you’re in business in the first place, and then outsource everything else. That may be a great way to cut expenses, but is it really what’s best for your business? That’s something that each business owner must ultimately determine for their company. Making sure you’re doing what’s best for your business is not always easy and at times can be down right perplexing. Determining what is, and what is not, internally tied to your core business function may be the answer.

One key factor that can literally make or break your business is how you choose to market your company’s products or services. As spending habits and communication methods are changing rapidly, companies of all sizes are electing to outsource their marketing with greater frequency than ever before. According to a survey of marketing executives done by the Harvard Business Review, fifty three percent of those polled said that they are planning to outsource the majority of their marketing activities.

As new marketing mediums become available companies often lack the capability to successfully exploit them using their current personnel. Hiring an outside company that specializes in marketing ensures that the task is being handled by industry experts. Not to mention that it’s usually a cost effective alternative to going out and hiring a full time employee whom may have expertise in their respective field. It also saves a great deal of time over trying to have one of your existing employees become competent in something they may have very little or no initial experience in.

Large companies that employ full time marketing personnel also understand there are advantages to outsourcing. Pizza Hut, Sony, Western Union and Microsoft are four examples of companies that have elected to outsource portions of their marketing functions. Even though these companies have internal marketing resources that small companies can only dream about, they realize the benefit of going outside for specific expertise. The reasoning behind this is that outsourcing highly specialized marketing functions, such as direct E-mail and database building, saves time, money and often produces superior results. A professional company that specializes in marketing will often have access to higher quality resources and offer a better system for managing the project.

Small to medium sized companies that do not have a formal marketing department are the ones that stand to benefit the most from outsourcing. Let’s face it, hiring highly specialized employees can be very time consuming and offers a substantial margin for error.

In addition to saving time and money, outsourcing your marketing ensures that you receive a sustained effort. In many companies marketing takes a back seat when there are other, seemingly, more pressing issues at hand. In the long run this can be very problematic. If you’re up to your ears in work right now you may have your people focus their efforts more on the operations end of the business while marketing functions take a backseat. What happens when the work begins to slow down? Now you are trying to make up for lost time and drum-up some new business.

Anyone who knows anything about marketing knows that you’re probably not going to see immediate results. Marketing is a prolonged process that produces results over time through brand recognition, product education, and consumer confidence. It should not be your last resort when sales are slow and prospects are dim.

Having an ongoing marketing effort also helps to build brand name recognition. When done correctly your potential clients will see your company’s message time after time through a multitude of channels. This adds tremendous credibility to your business by letting people know that year after year, even when times get tough, your company is still there going strong. Plus, outsourced marketing companies that provide database building services will usually provide you with a way to stay in touch with previous customers as well. In such a competitive market place customer loyalty is absolutely essential to the health of any business.

Don’t be too quick to jump on board the outsourcing bandwagon though without first doing your homework. As with any business issue there are always two sides to the coin. A third party may not understand the buying motivation of your customers as well as you do. As a result they might not incorporate internally known purchasing preferences into a new marketing strategy. Sales and customer relations may suffer initially as your marketing provider figures things out.

These are potential problems that can generally be avoided by selecting a company that specializes in marketing to your consumer base. This helps to ensure that they have a firm understanding of how your prospects respond to certain types of advertising and can therefore design your campaign accordingly. You also want to make sure that you select a company you are comfortable in dealing with. It is important to be able to maintain a consistent dialogue with your marketing team, whether they are in house or outsourced and working in another state. New marketing ideas and campaign analysis require detail oriented discussion on a regular basis... (End Part I)

Article By:
Nick Denroche
Vice President of Marketing
Contractor Power