Outsourcing Marketing? What Has This World Come To?

omwgBusinesses across the country are outsourcing work to other companies to increase work volume while holding down costs – a trend that marketing departments are beginning to follow.

Traditionally, companies have held the line at contracting for mainly non-professional work, such as secretarial or janitorial services. But in the never-ending search to cut costs, a company can now lease workers to supplement everything from its law department to its board of directors.

Outsourcing marketing

For example, one large addictions professionals association in Kansas cut one of its division’s marketing department from 12 to two people. The department has outsourced the actual work of writing direct marketing letters, newsletter publishing and supplemental sales force training to another company.

“There seems to be plenty of work for everybody, and it is very competitive,” says Roz Angell, director of corporate communications for George S. May International Co., a Park Ridge, Ill.-based consultancy.

Unhappy with results

A recent survey by the American Management Association, New York, shows that more than one-fourth of the jobs eliminated by major corporations have been replaced by outside companies.

However, that research also shows that a significant number of businesses are not happy with the results from outsourcing work.

But not all outsourcing is a patch to cover work after a company bleeds employees.

Several of May International’s clients are small and midsize companies that are looking at growth and need to outsource work to supplement the efforts of a small marketing department.

High accountability

“Smaller companies are certainly using a lot of services from the outside, and we don’t see that changing,” Ms. Angell says.

“Many of our clients are outsourcing corporate communications and advertising projects, jobs that come with high levels of accountability.”

In a number of cases, outsourcing hasn’t been used to trim marketing departments for just that reason – most executives choose to hold total control of a company’s image by keeping all marketing work in-house.

A number of technology-oriented companies will outsource as much work as possible, except for marketing, says Andrew Olson, managing director of communications, entertainment and technology for search firm Ward Howell International, New York.

Maintaining control

“Many companies see marketing as part of how they do business. They want as much control over it as possible,” Mr. Olson says. “They are not going to outsource strategic marketing, pricing or product development.”

Mr. Olson says his clients are outsourcing supplementary marketing functions, however, such as brochure development and mass mailings.

Ms. Angell agrees that corporate attitudes toward the use of outsourcing for various functions can vary widely. “In the marketing area, outsourcing has been pretty schizophrenic,” she says.

How to find some help

For marketers looking to bolster their departments through outsourcing, Roz Angell, director of corporate communications for George S. May International, Park Ridge, Ill., offers the following guidelines:

* Experience. Make sure the company you contract with has experience in your industry and knows your products well. Many smaller companies may not have the experienced work force you need to meet your demands, Ms. Angell says.

“They are hiring kids out of college and burning them out,” she says. “You want someone who understands business with a capital B and who knows where the bones are buried in the industry.”

* References. Don’t be afraid to ask for references. This will help you determine the company’s track record for doing the type of work you need done.

* Samples. Another way to evaluate an outsourcing company is to look for work samples in your line of business that show product positioning, business-to-business sales and integrated marketing strategies.

* Billing. Make sure before you sign a contract to ask for an itemized bill. “You want full financial accountability,” Ms. Angell says.

* Work relationship. “The chemistry has got to be there, because small- and medium-size businesses are many times in crisis,” Ms. Angell says. “It is important to bring them on board and talk with them frankly and trust them.”

If the company doesn’t communicate well with you, chances are it won’t communicate well with your customers or the public, either.

* Service. Demand superior service, especially with quality and deadlines. Says Ms. Angell, “There are enough companies out there that if you are not happy with what you’re getting, you can find another.”

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