Outsourcing is a kind of business process that has become very sought after during the past decade. A lot of small, medium-sized, and large businesses have started outsourcing business processes to organizations overseas.
Hypothetically speaking, a content writing company situated in a 2nd world country, in order to be competitive in their market, will have to offer competitive prices for their writing services. For a company situated in the US, these prices will be smaller than what US based writers usually ask for. Given the fact that, nowadays, it’s easy for businesses to connect on a global scale, there is no reason for the US based company not to outsource certain content creation processes and thus save money, while still getting (more or less) the same product.
So, basically, instead of looking for partners in their neighborhood only, small businesses can now turn to the global job market to find outsourcing partners and solutions, whereas large corporations can cut down certain costs even more. So, it is certain that companies are now more open to outsourcing overseas.
Benefits of outsourcing
No matter what kind of business you are running, outsourcing is always a viable option. The important thing is to find a reliable partner and recognize the right moment when you should make such a business move. Since we are talking about the benefits outsourcing provides, let’s mention some of the most crucial ones.
Cutting down on costs
One of the biggest and most obvious benefits of outsourcing is that companies are able to save money on valuable processes by reducing costs. Despite the fact that outsourcing services abroad will cost you less than hiring a local business to provide them to you, or training people to do those things in-house, you can also get higher quality work.
For example, the wages in China, a country which is one of the leaders of outsourcing jobs, are significantly lower than in the US. This is why it makes sense for US-based companies to outsource services from China, India and so on. Additionally, the companies that provide outsourcing services have mastered their line of work and can usually take care of their tasks incredibly well. When it comes to outsourcing, low prices doesn’t mean low quality work, as you can actually save money without sacrificing quality.
More resources to focus on essential business activities
A lot of companies choose to put a strain on their employees with either technical or documentation work. Although these tasks are important for a business, they are not the core activities of most companies. This means that their employees that specialize in a certain field have less time to work on their primary assignments.
This drastically reduces employee productivity, as well as the quality of their work. In this kind of scenario, the best option is to outsource non-essential business processes. Not only will they be done better by a party that specializes in this line of work, but your employees will also be able to focus on their primary tasks and improve overall business results.
Getting new knowledge
Outsourcing partnerships give you the option to learn from experts. For example, if you are outsourcing marketing services, you and your marketing team can learn how the pros do it. An outsourcing partnership means that you will collaborate and communicate on an everyday basis.
Through mutual collaboration both sides can learn from each other and become more efficient working together. For example, it will take less time for them to explain things that are not the primary focus of their work. More knowledge equals better communication, which leads to better cooperation.
Additionally, your employees will be able to learn as if you gave them training courses. Working together with a true expert, even if they are very far away, can be highly educational and helpful.
When outsourcing tasks that are more independent, a business can create better financial flexibility in situations where demand is not stable. Outsourcing allows you to scale easily and without any strain. There is no need to hire new employees, invest in infrastructure or build new departments, when you can instantly get the work you need for a cheap price.
Additionally, most outsourcing agreements can be designed so that the prices are adjusted according to the amount of work done. Simply put, a business will have to pay only for the effective work done for them. This way, all workload fluctuations will remain profitable.
Getting a competitive edge
One of the biggest benefits of outsourcing is that organizations are able to compete better and be more efficient overall. With strategic outsourcing and a reliable partner, companies are able to provide better products and services, and improve their productivity.
At the same time, their in-house resources are used wisely and companies have more room to come up with new business incentives that will allow them to bring in more customers, advertise better and increase their profits. Simply put, by harnessing all of the benefits of outsourcing that your competitors haven’t figured out, you can get in front of them and dominate your market.
Getting access to new markets
One of the often overlooked, but very big benefits of outsourcing is that certain partners abroad can give you access to new markets. For example, if a business sells products and ships them worldwide, language can be a great barrier.
If a business relies on calls to make sales and market products to people, outsourcing a call center abroad can give you instant access to customers that speak their language. One of the best examples is again Asia. Asian consumers simply love Western products and services, but a small percentage of them speaks English well. In this case, outsourcing your social media services to a country where you want to sell your products is the right business move. Not only can they target potential customers but they also know the area, people, culture, and can be more effective at bringing your products or services closer to customers.
Getting a fresh perspective
A company’s trends are not something that is talked about very often within a business. This is especially true if we are talking about a corporation or a large enterprise where there is a strict hierarchy. Additionally, the competitive environment makes this kind of talk a risky endeavor.
This means that marketing, sales or similar strategies are often discussed by only a couple of people who might need a fresh perspective. When outsourcing a marketing agency, you will get all kinds of feedback and insights, as they are not official employees, but partners. This means that they don’t have any fear of speaking honestly and giving you straight facts. This kind of fresh perspective can give you good business ideas and help you think outside the box. This is sometimes necessary for a business to move forward.
Important outsourcing stats
Now that we’ve went through some of the biggest benefits of outsourcing, let’s see what the numbers say. All of the benefits mentioned above are backed by real stats, so if you need more proof here is what you need to know:
Expertise is crucial
A survey done by CMO has shown that the biggest reason why companies outsource marketing services is that they don’t have the expertise and experience required to do these tasks as well as needed. Instead of investing a lot of time and money in teaching employees to perform marketing actions like professionals, it’s better to outsource experts that can instantly do the job for you.
Is outsourcing really cheaper?
A study has shown that 92% of companies which outsource disaster recovery say that their costs haven’t increased and that they’ve even lowered once the company switched from in-house process handling. Not only does this prove how outsourcing is, in fact, generally much cheaper, but it also shows that companies that provide outsourcing services are trusted and are given important tasks to handle by their partners.
The outsourcing market is growing
The global outsourcing market in 2017 has doubled in size. This shows that there are more and more businesses willing to invest in outsourcing their services and that there are more companies out there that offer outsourcing partnerships. Overall, this shows that outsourcing is no longer a taboo, but a reliable business model that benefits companies. Otherwise they wouldn’t engage in such business partnerships.
Outsourcing is reliable and guarantees better performance
A report has shown that the majority of marketers (almost 90%) don’t know how to measure the performance of their marketing efforts or their ROI. Additionally, around 80% of marketers cannot account for their spending in their marketing campaigns.
Marketing agencies that outsource their services have learned to be accountable. One of the first things they’ve learned is to provide their partners with reports in which they can justify their tactics, spending and results. Additionally, they have transparent costs and this is why outsourcing marketing efforts has become so popular.
Some tasks are mostly outsourced
The outsourcing industry has made such a huge impact on business and their benefits have made certain jobs outsourced almost exclusively. One of the tasks that are more often outsourced than done in-house by companies is content marketing. This content marketing survey report has shown many interesting insights.
In fact, most companies admit that their content marketing efforts are not entirely their own and that they have help from their partners. The most common content marketing tasks which are outsourced by companies are writing 44% and design 41%.
This shows that companies feel comfortable with outsourcing content marketing, as their partners can give them better quality and larger volume of content.
Most outsourcing relationships are successful
A global outsourcing survey from 2016 showed that almost 80% of people that outsource some processes or services are satisfied with how their partnerships are performing. This shows how reliable this business model is, and that people who know what to do are almost always able to get all of the benefits they were looking for.
It's all about being prepared
The same survey has shown that companies which invest a bit more time and effort in finding a good outsourcing partner, and setting up the first stage of their work, were able to create long-lasting and beneficial relationships. This indicates that with a bit of preparation and hard work put in, any company can find a reliable strategic outsourcing partner that can help them improve their results.
10 factors to consider when outsourcing a marketing agency
Although outsourcing marketing can be very beneficial, it is still important to find a good, reliable partner. In order for an outsourcing partnership to be successful and beneficial to both sides, it’s important that they are on the same page. Not all outsourcing strategies are effective. and this is mostly because companies outsource processes to organizations which are simply not up to the challenge. This is something you need to avoid. Here is what you need to know when opting for a marketing outsourcing partner.
Level of communication
Before you even think about taking an official outsourcing partner to take care of all your marketing efforts, you need to make sure that you will have good communication. This is something that is important for all outsourcing partnerships. It will never work out if you and your partner don’t have a mutual understanding and communicate effectively.
Start of by asking questions about how they like to communicate with their clients. Will they deliver performance reports, how, when and which information will they include? Make sure that you find a partner that measures their campaigns and can give you fact-based reasons for their actions.
You need to have an accountable partner that will take responsibility. Additionally, they will need to be available to you for discussions and meetings. Simply put, you need to be on the same page and create an honest communication where everyone is realistic about their expectations, and together you will make better results.
What are your marketing needs?
Before you start looking at your potential partner and whether or not a marketing agency meets your needs, you will first have to determine your marketing needs. This means making a list of services that you will require from your outsourcing partner. If you have a marketing team of your own, you will also have to determine which tasks will be handled in-house and which ones will be outsourced. The best way to go is to keep those tasks that you know how to handle in-house and give more difficult and complex ones to your partner.
First make sure to determine your marketing goal and tell it to your potential partner. Marketing goals can be: downloads, sales, generating leads, increasing traffic, or spreading brand awareness. Concrete marketing capabilities companies can offer you to achieve these goals include creating a website strategy, designing it and developing it, SEO, marketing analytics, marketing automation, PPC, social media marketing and email marketing.
What can you find out about them online?
Given the fact that you are looking for a company that will market your business online, taking a look at their online presence is not a bad idea. You need to see if that agency has put in effort to represent themselves to potential customers in the proper way. This can quickly show you if an agency is good or not. Check out their website, blog, social media, and google them to see what comes up. This way you can quickly spot red flags and instantly eliminate companies that are a big “No”.
For example, if you are in need of blogging services and content marketing, you cannot go with an agency that has a poor blog of their own, with bad grammar and boring content.
Expand your search even further by finding previous customers an agency has worked with. Try to find their contact information and learn more about an agency through them. For example, a lot of reliable companies like to display lists of satisfied clients on their websites. This shows that they are confident in the services they provide and that they have nothing to hide. Look for that kind of list or customer testimonials. These can instantly give you valuable insights about a business. Still, it is essential to contact previous clients or set up meetings with them if possible.
When talking to them ask them about what kind of relationship they’ve had with the agency, what level of communication they’ve had, which results they provided them with, what their level of satisfaction was, and why they stopped their partnership. Simply put, ask anything that could help you learn more about that agency.
A very important thing that people tend to forget about is the culture. Bad cultural compatibility can cause a lot of problems in an outsourcing partnership and make a seemingly good thing a pure nightmare. Cultures that are too distant can have troubles understanding each other and synchronizing their business relationship.
This can include different business values, language barriers, and different ways of communication. The first thing that needs to be discussed before anything is your partnerships, its terms and what you expect from each other. If you instantly realize that you have big differences in views that you cannot overcome, go and look for a partner somewhere else.
For example, many US companies have had problems with outsourcing in Asia because of the huge cultural differences. Asians simply do business differently and this causes a lot of problems. This is why a lot of US companies are looking to outsource from Eastern Europe, as they can find cheaper services but with smaller cultural differences.
Location is very important for companies that want to create a close business partnership. Although outsourcing offers many benefits to companies around the world, one of the downsides is that it goes with impersonal communication where people cannot discuss business face-to-face. For some type of businesses, this kind of communication is simply necessary. Additionally, some managers and business owners don’t like to talk about sensitive topics and important issues through emails, video conferences or online chats. If this is your case, then you should first start by searching for a partner on the local level and then in your whole country.
On the other hand, your location is still important even if you don’t need face-to-face communication. You need to consider the time zone of where your potential partner is, as it can affect your schedules and work organization. You need to make sure that they are there when you need them and that nothing gets overlooked.
Do they outsource as well?
A lot of digital marketing agencies themselves outsource a certain part of the work they do. This is neither bad nor good. Still, you need to ask them about this and see how transparent they are about their own outsourcing. This can improve their service or make it worse, depending on what they outsource and how.
For example, if you are talking to an agency that specializes in content marketing, they might be outsourcing a portion of their writing services. This means that they are paying someone even less than you are paying them for writing services. At this point, it usually means that they are paying low-skilled people for their efforts.
Additionally, this means that they will be inconsistent with their content and this is something nobody wants. On the other hand, if they outsource designers to create infographics based on their writing, it could actually help them provide higher quality content. You can also ask for information about their own business partners and see what they are about.
Inspect contracts in detail
First of all, a reliable outsourcing partner will always give you a contract sample through which you can officially start your partnership and continue forward with your work. If there is no legal document as proof of your partnership, you might put your business in danger in many ways. This kind of document gives transparency to your business partnership and this is why it’s a must. If there’s no contract, it is probably a better idea to continue searching for the right agency.
A typical outsourcing contract includes things such as the requirements from both parties, legal terms that indicate how long the contract will last, the process of stopping your business relationship and any potential abuse and lawsuit protection. These kinds of contract are legally binding to both partners and this is why they need to be read thoroughly and analyzed, preferably with the help of a lawyer.
Given the fact that you can outsource from basically anywhere in the world, this means that you might encounter different laws that affect these kinds of business partnerships. Although some countries have made such relationships a top priority because they help improve their economy, some countries are still closed to foreign businesses and they require special paperwork or different contracts to be signed before engaging in such a partnership.
You need to talk to your potential partner about this, get all the explanations you need and consult your lawyer to make sure that you are not jeopardizing your business in any way. Still, the best option is to find countries that match with their regulations, so that your work can be conducted smoothly.
Although they are not the first thing you should look at, prices can give you a better perspective about a digital marketing agency. After all, you are looking to save money and make a good business investment. However, you shouldn’t base your decisions solely on the price. When it comes to outsourcing marketing, low price means low quality of work. Don’t focus on the money only and make a bad business decision that could cost you a lot more than the money you’ve “saved”. You need to create a balance between services, quality of work and price, and this is how you can find a good candidate.
A lot of people become greedy when they realize just how much they can save by outsourcing. However, if you hire someone who has poor expertise, they will only cause problems for you and you will throw money away on work that doesn’t mean anything to you.
Marketing outsourcing prices
Depending on the continent, marketing pries can be very different. After all, the main goal of outsourcing is to save money while getting a quality service. This is why you need to learn to find the right prices while also making sure that your time, zone, culture and all of the things we’ve talked about earlier are to your satisfaction.
Depending on the volume of work and the type of marketing services, the costs of outsourcing in North America can go from $3000 per month, up to $10,000. It is definitively the area with the highest prices for marketing services.
The prices for marketing activities in Latin America are 40 % to 60 % lower than in North America. Given the fact that both the US and Latin America were heavily influenced by European culture, countries from these continents have fewer cultural barriers that make it difficult for them to do business. The outsourcing market in South America is constantly growing and improving, making it an attractive region for companies from North America.
When it comes to outsourcing in Western Europe it’s almost impossible to find a single freelancer, let alone a whole agency that will charge you less than $20 per hour. Even if you are able to go somewhere near this figure, chances are that you will get someone who is inexperienced and not capable of handling serious work. In the UK the prices are similar to those in the US, while there are countries like Spain where you can find cheaper options.
All countries located in the so called “post-Soviet” region of Eastern Europe have big individual IT markets overall. Together, they are the largest freelance market in Europe. Simply put, there are a lot of people that want to work online and they cannot find jobs locally
An average hourly rate for freelancers in these countries is around $20 per hour, meaning that you can find a lot cheaper options. These countries are all investing in IT and their outsourcing markets, making them very attractive for companies looking to outsource various services, including marketing.
Outsourcing marketing and other services is a viable business option that is utilized by smart companies from all around the world. Although before it was a trend to outsource from Asia, there are more and more companies looking towards Eastern Europe.
This whole region has got a bad rep because of communism, but these countries have opened up towards the world and they’ve shown that they have very cheap but skilled employees. Not only are they are much closer (especially to countries from Western Europe) but they are also very culturally similar to them, as well as to the US.
This is why there are more and more companies from the West looking to outsource in Eastern Europe. An outsourcing review report from 2010 has shown that this whole area is a hot prospect for outsourcing. There are more and more companies that are starting to realize that outsourcing is not strictly the domain of India or China, and that there are opportunities for cooperation all around the globe.
If you want to see how outsourcing in Eastern Europe works, feel free to contact Incredo and learn more about the inbound marketing service they provide.