Outsourcing advertising is often the less costly and more effective strategy for startups and small businesses.

Small Business DIY Disaster: Why Outsourcing Advertising is Best

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In the frantic world of small business marketing, DIY advertising can feel like a double-edged sword. You crave control and potentially lower costs, but the pressure to navigate an ever-changing landscape with limited expertise can be overwhelming.

This is where outsourcing advertising comes in. By partnering with a professional agency, you gain a team of experts who can craft a data-driven strategy, optimize your campaigns for maximum impact, and free up your valuable time to focus on what you do best – running your business.

In this article, I’m going to share lessons learned from almost a decade of advertising work specifically with clients who are self-employed, just starting up a company, or are contemplating hiring an in house marketing team vs outsourcing advertising.

Quick Links In This Article

Before we jump into the details, let’s recap a few details to ensure we’re on the same page.

By advertising, we’re not talking about social media management. We’re not talking about creating lead funnels.

We’re not even talking about your overall marketing strategy.

This post is narrowed down to the act of using paid media – ads. Why? Because it’s here – in the DIY advertising – where I find most clients spending months of ad budget not seeing a single result.

So let’s go there. Let’s talk about the do-it-yourself pitfalls to avoid. And the advantages of outsourcing your small business advertising.

Part 1 The Pitfalls of DIY Advertising

I’ve seen a gamut of pitfalls and mistakes made by companies as they startup or ramp up their advertising.

Look, I get it. Strapped for time, limited resources, limited know-how — a startup just knows they need to accelerate growth, and what better way than advertising?

So, if you’re a DIY startup or DIY small business, this section is for you.

If you’re contemplating DIY vs Outsourcing Advertising, this section is also for you.

Often advertising strategy comes down to costs for small businesses and startups. This graph compares in house ad costs to outsourced advertising.
Often, advertising strategy comes down to costs for small businesses and startups. This graph compares in house ad costs to outsourced advertising.

Face the Facts of DIY and In House Ads

It’s expensive. We’ll dig further into the hidden costs of DIY advertising just below, but for now, let’s face the facts.

  • It costs on average $1,100 to onboard and train a new employee for a marketing team.1 Unfortunately, for small businesses the costs are higher than average due to lack of support systems.
  • If you hire a single ad manager, you could be facing around $86,000 per year in salary and benefits. That’s if you want the average.2 If you want to hire competitively, expect to pay more.
  • DIY. If you choose to DIY, just know that the average small business with about 25 employees spends $200,000 per year for their marketing team.3 That’s the marketing muscle you’re up against should you choose to gun-sling it as a lone ranger.

If you prefer the lone ranger route, that’s fine.

But know, there are hidden costs of DIY advertising. Let’s dig into them.

Hidden Costs of DIY Advertising for Small Businesses

The allure of DIY advertising is undeniable for small businesses – it promises complete control and seemingly lower costs. But beneath the surface lurk hidden expenses that can quickly erode any perceived savings.

Small businesses often find themselves spending a staggering amount of time figuring out how to run ads.

That’s not even saying they’re running effective ads.

The trial-and-error approach of DIY advertising can lead to inefficient ad spend, with some reports indicating that up to 25% of digital advertising budgets are wasted due to inefficiencies.

For instance, small businesses spend an average of 20 hours per week on marketing efforts, which is time not spent on other critical business operations.

Additionally, without specialized knowledge, the trial-and-error approach of DIY advertising can lead to inefficient ad spend, with some reports indicating that up to 25% of digital advertising budgets are wasted due to inefficiencies.

Furthermore, a lack of expertise can result in lower conversion rates; industry benchmarks show that professional campaigns average a conversion rate of 2.35%, while self-managed campaigns may struggle to reach even half of that figure.

These hidden costs highlight the importance of considering the full scope of resources required for effective advertising beyond just the financial outlay.

When Saving Cost Cuts Deeply Into Ad Quality

A common scenario where cost-saving measures can compromise quality is in the realm of social media advertising. For instance, a business may choose to use automated ad creation tools to save on design costs. While this approach can reduce expenses, it often leads to generic and less engaging ads.

In a 2024 case study, we saved a client 75% in ad budget, which more than covered the expense of our service.

Here’s an example from a recent client.

Pinterest Ads managed by Mafost Marketing provided increased ROAS and decreased CPC compared to Google Ads.
Pinterest ad campaigned started in Sept.2023 continued through time of this article, February 2024. We achieved increased ROAS and 2,980 clicks to the UK-based e-commerce store.

We picked up the advertising after they invested 4 months of advertising and over $10,000 of ad spend into Google Ads. However, we have access to data and expertise that they don’t and we immediately knew Google Ads were the wrong channel for their ad budget.

Up against stiff competition from bigger companies, their ads were shown to low-quality audiences in all the wrong places at the wrong time.

We quickly switched their ad campaign from Google to Pinterest, changed the creative and targeting, and began seeing results within 30 days.

Cost per click went from over $0.40 to $0.11 per click. That’s nearly a 75% savings in ad spend per result.

Our service cost the client $450/month, and we saved the client $7,500 in ad spend to achieve better traffic to their online store.

With $10,000 of ad spend, 75% savings equals $7,500. Our services cost $450 for the month, a major net win for the small retail business.

In House Advertising Challenges for Small Businesses

When businesses seek our services, 75% of them are facing two or more of the challenges below.

Because, frankly, it’s not easy to run your business and manage your marketing.

As a matter of fact, these are the same reasons that CMO (Chief Marketing Officers) are being cut from large businesses – in house marketing comes with major challenges.

Here’s a quick list of the challenges we see with most small businesses trying to run their marketing and advertising in house.

  • Keeping Up with Trends: The digital marketing landscape is constantly evolving, requiring ongoing education and adaptation. When dealing with the limited scope of advertising for your own company, it’s difficulty to see the larger picture within and across industries.
  • Resource Allocation: Balancing marketing efforts with other business operations can strain resources. It’s much simpler to have an allocation for outsourced advertising.
  • Access to Advanced Tools: High costs associated with advanced marketing software and analytics tools may be prohibitive. In fact, the marketing suite we provide clients would cost over $1000 per month to obtain in house. We provide it, along with expertise and execution for less than that price!
  • ROI Measurement: Accurately measuring the return on investment for marketing campaigns requires expertise and robust analytics.
  • Talent Acquisition and Retention: Finding and keeping skilled professionals with the necessary marketing expertise can be difficult and costly. That’s not to mention the HR challenges with expanding your employee base. It’s an arena best for medium to large companies.
  • Scalability: As the business grows, scaling up advertising efforts efficiently can become a complex task.
  • Legal Compliance: Navigating the legalities of advertising, such as privacy laws and regulations, is essential but can be tricky.
  • Creative Fatigue: Continuously producing fresh, innovative content to engage audiences can be demanding.

Challenges of in house advertising aside, there are also pitfalls associated with the limited experience.

Common Mistakes in DIY Advertising

We were working with a local construction business serving midwest USA. When we came onboard CPC was over $2.50 and revenue was the only metric that was tracked.

That’s not how advertising works.

The CPC for their local industry was too high and tracking end of funnel metrics (aka revenue) did not tell whether aspects of their ad campaigns were having an impact.

Outsourcing Advertising - Conversion rate optimization is complex for DIY Advertisers
Conversion rate optimization is the process of tailoring ad assets and bidding strategies to maximize conversions for specific business goals. This graph shows a how we achieved 32% conversion rate for a Houston-based client in February 2024.

Instead, we targeted a cascading set of metrics ultimately leading to CPC of $0.80:

  • Impressions per geographic area
  • Cost per video view
  • Growth/decrease in website events
  • Average time on page for ad clicks

We used this data to tailor the targeting, conduct AB tests, and ultimately saving them 68% in their ad spend!

It’s a common mistake and falls in line with these common mistakes made in DIY advertising:

  • Neglecting key metrics: Failing to track and analyze key performance indicators (KPIs) like impressions, clicks, and conversions makes it impossible to measure the success of your campaigns and optimize them for better results.
  • Using automation platforms and generic ad templates: One-size-fits-all ads lack personalization and fail to resonate with your target audience.
  • Failing to adapt to changing platforms: The digital advertising landscape constantly evolves, and not staying up-to-date on platform changes and best practices can hinder your campaign performance.

So I briefly mentioned automation platforms. But with the rise of artificial intelligence, software companies trying to capitalize on the moment. Everywhere you turn there are ads for automated advertising solutions.

And it’s a problem.

Let’s dig into why.

Beyond the Template: The Downside of One-Size-Fits-All Advertising

Whether it’s the newest ai platform, an automated advertising solution, or an ad template, it’s never going to outpace the competition that utilize the expertise of professionals.

Limitations of Generic Ad Templates

Generic ad templates offer a quick and easy solution for businesses looking to advertise, but they come with significant limitations.

These templates lack the personal touch that resonates with consumers, often resulting in ads that fail to stand out in a crowded marketplace.

Personalization is key to capturing the attention of potential customers, as it allows for messaging that speaks directly to their needs, preferences, and pain points. A personalized approach can significantly increase engagement rates, click-through rates, and ultimately, conversion rates.

By tailoring content to the audience, businesses can create a more meaningful connection and foster brand loyalty.

Limitation of AI Automated Ad Platforms

While AI-automated ad platforms promise efficiency and cost-effectiveness, they also have notable limitations.

These systems are typically designed to optimize for specific metrics, such as clicks or impressions, which may not always align with a business’s unique goals or brand values. They may also lack the nuanced understanding of human emotions and cultural contexts that are crucial for creating compelling ad campaigns.

Furthermore, AI platforms can sometimes produce repetitive or irrelevant content, leading to ad fatigue among audiences.

The absence of human creativity and strategic thinking in AI platforms means they might miss opportunities for innovative campaign ideas that could capture the public’s imagination and drive more significant results

Part 2: Why Outsourcing Advertising Wins

What then should a startup or small business do? Is there a place for DIY advertising?

Let’s look at an honest cost-analysis breakdown between DIY advertising and outsourcing advertising.

Outsourcing Advertising

Financially, outsourcing to a professional agency may seem like a larger upfront investment, but it often leads to better ROI due to expert strategy and execution.

Agencies bring specialized knowledge, access to advanced tools, and industry connections that can negotiate better ad rates and placements.

Strategically, outsourcing frees up internal resources, allowing businesses to focus on core operations while experts handle the complexities of marketing. This can lead to higher quality campaigns that are aligned with the latest trends and best practices.

DIY AdvertisingOutsourcing Advertising
Easy to startEasy to start
Cost-effective initiallyLarger upfront investment
Limited scalabilityScales quickly with budget and business goals
Lack of experience, vantage points, and resourcesLeverages vast cross-industry tools and experiences

DIY Advertising

On the other hand, DIY advertising can appear cost-effective initially, as it eliminates the need for external agency fees. However, hidden costs such as time spent learning and managing campaigns, potential for higher ad spend without desired results, and opportunity costs of not focusing on business strengths can diminish its value.

Strategically, DIY may limit scalability and adaptability due to a lack of expertise and resources. While it offers more control over the creative process, it also carries the risk of lower campaign effectiveness if not executed properly.

In summary, while DIY advertising offers control and potentially lower initial costs, outsourcing provides professional expertise, potentially higher ROI, and strategic advantages that can outweigh the financial investment in the long term.

Expertise Over Automation

Automation excels at efficiency, but human expertise brings the magic. Advertising veterans possess the creativity, strategic thinking, and consumer insights to craft bespoke campaigns that resonate. They can adapt to market shifts and ensure your brand’s voice is heard loud and clear. While automation has its place, true advertising success hinges on the irreplaceable human touch.

Unlocking Potential: How Outsourcing Frees Up Your Internal Resources

Unlock your business’s potential by outsourcing advertising. Shift internal resources to where they shine—your core business. This strategic move enhances efficiency and spurs growth. Agencies, armed with cutting-edge trends and tech, craft impactful campaigns. Experience the dual advantage: excel in your domain and gain from expert marketing that broadens your influence.

Part 3: The Advantages of a Professional Partner

I hope we’re clear on the case against DIY advertising. If must DIY your advertising at the beginning, I hope you can avoid the pitfalls mentioned above.

As soon as possible, consider the investment of partnering with an advertising pro or agency.

From DIY to Done-Right: The Power of Professional Strategies

Feeling the limitations of DIY advertising? Shift from amateurish to expert with a professional agency’s help. Agencies offer deep expertise in campaign strategy, crafting plans that target your ideal audience and align with business goals—no more wasted time or money on ineffective efforts.

Take a look at this case study from a client’s ad campaign in February 2024.

Pros can help you understand the data and help you outpace the competition. This graph shows top advertising competitors for a client of Mafost Marketing, 2024.
Outsourcing advertising with a pro, can help you understand your data and outpace your competition. This graph shows data from a Mafost marketing Client, 2024. With expert guidance we were able to adjust strategies to avoid the large ad budgets of St. Jude and better tailor our ads to brand competitors like abcfundraising.com.

Beyond the Set-It-and-Forget-It Trap: Ongoing Optimization for Maximum Impact

Static campaigns don’t cut it. Avoid the pitfalls of autopilot by embracing an agency’s ongoing optimization. With data-driven insights, agencies fine-tune targeting, messaging, and creatives for relevance and impact.

Let’s take a quick look into the case of another client campaign from January 2024. In this graph below, you’ll see three ad delivery networks:

  1. Google Search
  2. Search Partners
  3. Display (ads on websites, apps, etc)
Optimization of ads is an ongoing job requiring skills and time - an expensive proposition for in house ad teams and too complex for standardized automated ad platforms.
Optimization of ads is an ongoing job requiring skills and time – an expensive proposition for in house ad teams and too complex for standardized automated ad platforms.

We carefully adjusted our ad strategy based on which platform was giving us the best results at the lowest cost. Allowing us to maximize brand impressions and ad budgets against larger competitors.

This continuous refinement is often out of reach for in-house teams, making professional outsourced ad services a wise choice for those aiming to maximize ad spend ROI.

Several factors require ongoing optimization:

  • Competitor Bidding: The advertising landscape is constantly shifting as competitors adjust their strategies.
  • Creative Fatigue: Over time, audiences can become desensitized to the same ad creative, requiring refreshes to maintain engagement.
  • Targeting Shifts: Customer demographics, interests, and online behavior evolve, necessitating adjustments to targeting parameters.
  • Platform Updates: Advertising platforms regularly introduce new features and functionalities that can optimize campaign performance.
  • Budget Allocation: Performance data can reveal opportunities to optimize budget allocation across different ad groups or channels.
  • Seasonality and Trends: Consumer behavior is influenced by seasonal trends and current events, requiring campaign adjustments for optimal reach.

The Competitive Edge: Unleashing Agility and Expertise

In a cutthroat market, sophisticated strategies are key. Partner with an agency for a competitive advantage. Agencies bring analysis and agility that go beyond in-house capabilities. Tap into their comprehensive services to transform your advertising from amateur to excellent, driving superior results and market presence.

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Frequently Asked Questions about Outsourcing Advertising

What is paid media?

Paid Media: Paid media refers to external marketing efforts that involve a paid placement. This includes PPC advertising, branded content, and display ads. It’s a way for businesses to promote their brand, product, or service through sponsored content or advertising.

What options do small businesses have with paid media?

Options for Small Businesses with Paid Media:
  • Social Media Advertising: Platforms like Facebook, Instagram, and LinkedIn offer targeted advertising options suitable for various budgets.
  • Search Engine Marketing (SEM): Using platforms like Google Ads to appear in search results for specific keywords.
  • Display Ads: Banner or video ads on websites that are part of ad networks.
  • Native Advertising: Ads that match the look and feel of the media format where they appear.
  • Influencer Marketing: Partnering with influencers to promote products or services.

What are automated ad platforms?

Automated Ad Platforms: These are systems that automate the buying, placement, and optimization of media inventory via a bidding system. They allow advertisers to purchase ad space without the need for direct negotiation with publishers. Examples include Google Ads and Facebook’s advertising platform.

What is outsourcing advertising?

Outsourcing Advertising: This involves hiring an external agency or team to handle the advertising efforts of a business. The outsourced partner is responsible for strategy, execution, and management of advertising campaigns, leveraging their expertise to achieve better results than what the business could achieve on its own.

What is In House Advertising?

In-House Advertising: In-house advertising refers to the practice of a company managing its own advertising efforts internally, rather than outsourcing them to an external agency. This means the company has its own marketing team that strategizes, creates, and executes advertising campaigns using the company’s resources.

Do large companies outsource marketing?

Yes, many large companies do outsource some or all of their marketing efforts. Even with substantial in-house capabilities, they may seek external expertise for various reasons such as accessing specialized skills or technology, managing large-scale campaigns, entering new markets where local knowledge is crucial, supplementing their in-house team during peak times or for specific projects, and gaining an outside perspective to innovate their marketing strategies.
  1. Average onboard and training costs by Statistica. https://www.statista.com/statistics/1418350/onboarding-training-cost-per-employee-us/ ↩︎
  2. Average salary for in house advertising marketing manager in 2023, USA was $86k. Stat from Maennche CMO. ↩︎
  3. Small businesses of 25-49 employees spent an average of $200,000 paying for in house marketing teams. Stats from WebFX. https://www.webfx.com/digital-marketing/learn/in-house-marketing-vs-agency/ Accessed on 3/23/2024. ↩︎

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