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Top 3 Reasons To Hire An Ad Agency

Many small business owners are all about the DIY (Do-It-Yourself) which stands for creating things for themselves without the aid of paid professionals. We understand what it’s like to be a small business owner (we’re one too!) and we get how frustrating it can be to try and decide where your limited marketing dollars should be spent. On the surface, to the untrained eye, marketing is something that can be self-taught with little difficulty.

The reality is that there is a large learning curve for a busy entrepreneur with little experience in marketing. With the time it takes to complete everything necessary in a day/week/month to implement a balanced marketing strategy it doesn’t leave time for much else (like doing what you do best, running your business.) This can leave a small business owner with either an incomplete marketing strategy missing key elements, such as not having a great enough presence online or even having a poorly designed website that is costing their business money.

Should I Hire an Employee or an Advertising Agency?

Now that we have established just how difficult it is to effectively implement your own marketing strategy small business owners are left with three options. Option 1 is to hire an employee. Option 2 is to dump the marketing duties onto an existing already busy employee (like an office manager). Option 3 is to hire an outside advertising agency. Let’s take a look at these three different options in depth to help you decide which option is right for your business.

Option 1: Hiring an employee/marketing director

A lot of the time small business owners lean towards hiring an employee or delegating these duties to an already existing employee because that has been the process in the past to solve an immediate need. Business owners also may have the perception that an outside advertising agency is far more expensive than hiring in-house employee. This couldn’t be further from the truth.

Many owners fail to take into account all of the true costs associated with hiring and keeping an employee. When you hire an employee, not only do you have to account for their base salary but you must add in fixed costs like taxes, health insurance

contributions, retirement plan matches, vacation time, sick days, etc. This means that the true cost can be 1.25 to 1.4 times the base salary.

Let’s use an example to show the difference. Say your small business spends $50,000 annually on advertising. Below we will evaluate the cost of hiring an employee fresh out of college for a modest $35k annual base salary as your marketing manager with 1.3 times base salary for benefits.

Marketing Director Base Salary: $35,000

Benefits/Vacation/etc.: $10,500

True cost of hiring this employee: $45,500

Cost per month of hiring this employee: $3,791

This doesn’t even take into the account that this person has little experience and is going to be a one man show with no relationships with other media companies (Google, T.V. stations, radio stations, newspapers, etc.)

Option 2: Having an existing employee manage your advertising campaign

This is the quickest and easiest option but also the most ineffective. The fact that this employee is already on the payroll is nice, however they are most likely already very busy. They were hired in to do a different task, and now you’re adding to their workload.

This employee will often put your marketing campaign on the back burner because it was not what they were originally hired to do and they are not experts on it. If your marketing campaign is being put on the bottom of a to do list and it isn’t being monitored constantly, you may as well just light your ad dollars on fire.

This option is not recommended because you are going to be wasting a lot of money where you probably think you’re saving it. Sure, you won’t spend as much on HR because you’re not hiring an employee. More than likely though, you’ll end up spending much more money because your return on your investment won’t be nearly as great because this employee more than likely doesn’t know what they’re doing.

Option 3: Hiring an advertising agency

Aside from saving thousands of dollars, there are plenty of other advantages of working with an ad agency like us, MPH Marketing Solutions, compared to hiring a marketing director, having an existing employee manage your ad campaign, or doing it yourself.

Some of these advantages are the following:

• Expertise in your local market of Metro Detroit

• An honest dedicated partner who wants your advertising program to succeed

• Ability to get discounted rates on your current media programs from our already established relationships with other media sales representatives

• Experience in creating and executing marketing plans

• No employee training required

• Avoid HR nightmares

• No additional overhead

• Tax deductions, not tax liability

• Free up more time for yourself

Services that are included in our management fee are the following:

• In depth-market and industry analysis

• Conduct meetings with all advertising sales reps

• Creating an advertising strategy that makes sense for your budget

• Creative Consulting

• Budget Allocation

Cost analysis

Let’s break down the true cost difference between hiring an in house marketing director to hiring an ad agency. For this example, let’s say that your small business spends $50,000 annually on advertising.

Below we will evaluate the cost of hiring an employee fresh out of college for a modest $35k annual base salary as your marketing manager with 1.3 times base salary for benefits.

Marketing Director Base Salary: $35,000

Benefits/Vacation/etc.: $10,500

True cost of hiring this employee: $45,500

Cost per month of hiring this employee: $3,791

Now let’s compare this to the cost of hiring MPH Marketing Solutions as your ad agency for a year with that same marketing budget of $50,000 at our 15% management fee.

Advertising Budget for Business: $50,000

Agency Annual Fee of 15%: $7,500

Agency Monthly Fee: $625

As you can see, the decision to go with an ad agency is a no brainer. You will save time, money, and have experts on your side who will do everything in their power to make your program succeed.

Here at MPH Marketing Solutions, we are a full service ad agency. That means that we’ll be your point of contact for all things advertising: from the creation of a website, to ads on Google, SEO, Social Media, to getting a video created, to then putting that video on T.V. we truly are a one stop shop for all of your marketing needs.

Give us a call today for a free consultation or fill out the form on our site to see how we can help shift your business into high gear!