In-House vs Agency: Pros and Cons for Paid Media Performance

by Carissa McStay | December 28, 2021

Giving paid media the investment it deserves isn’t cheap — it’s a cost you need to justify every quarter. If you don’t have the right pieces in place like a creative feedback loop and end-to-end measurement, it can be hard to prove the impact of your campaigns. One big question looms as you assess your options: in-house vs agency?

Paid Media: In-House vs Agency

There are pros and cons to bringing paid media in-house. The right move depends on your strategy and your digital marketing team structure.

You need a lot of time and money to run an in-house paid media program. But when done properly, this structure can be a flexible, efficient revenue generator.

On the other hand, hiring an agency comes with its own set of communication and budgetary challenges, but you instantly get access to marketers with platform expertise and a built-in peer network of collaboration and idea-sharing.

For marketing leaders who are new to their role, this can be a major decision. Which is right for you? 

Option 1: Keep your paid media in-house

Hiring a paid media specialist or dedicated in-house team comes with advantages. This team would focus solely on your business goals. Training can help them understand and implement your marketing strategy. They’re also an email or slack message away whenever an urgent matter needs to be solved quickly. Finding the right people for this role can be a huge advantage, especially if they perform well and have experience delivering attributable return on ad spend.

However, hiring an in-house paid media team can be a major pain point for marketing leaders. The labor market today is in short supply of marketing talent. The rise of remote work has enabled companies to hire marketing staff from anywhere in the world. But competitors have the same opportunity. 

According to research by Robert Half in June 2021, 54% of senior managers in marketing and creative said they were hiring for new positions in the second half of 2021. In the same survey, 75% of marketing leaders said turnover has increased on their team since Jan. 1, 2021, mainly due to limited opportunities for employees’ career growth. 

Once you hire a specialist, ongoing professional development is critical. Do they regularly attend industry webinars and research major platform updates? Do they have a group of peers to share experiences, results, tests, and bounce ideas? These activities are essential to keeping up with best practices and being on the forefront of new trends. Companies with in-house teams should create repeatable processes for this kind of professional development to hedge against turnover. 

Option 2: Hire a performance marketing agency for paid media

If an in-house paid media team doesn’t fit your budget, but you still need to generate leads and sales, consider hiring a performance marketing agency. Typically, working with an agency is a straightforward relationship with a time-bound contract and scope of work that spells out accountabilities and deliverables. Some marketing leaders could see it as less risky than hiring in-house.

However, agencies are not cheap. Large agencies generally charge between 15-20% of total ad spend. A smaller agency may charge 10-15% while requiring an account minimum. If you are spending several thousand — or several hundred thousand — dollars on your paid media campaigns each month, those fees add up very quickly. That’s why it’s critical to work with an agency who understands your strategy, your industry, and your digital marketing channels.

Working with Silverback Strategies gives clients access to a team of search, social, content and analytics specialists, who work closely with a senior marketing strategist to orchestrate cross-channel campaigns. These teams connect with dozens of other marketers across the agency where they share insights, test results, and experiences. This environment fuels campaign innovation throughout our client portfolio.

How a performance marketing agency can help: six frequently-asked questions, answered

We asked how they handle multiple client requests and stay on top of an ever-changing industry while still delivering the outstanding results characterizing Silverback’s paid media programs for the past decade.

This inside look allows you to make a more informed decision as you consider whether to hire an agency or build your own paid media team. 

Question 1: Is my agency team truly dedicated to my account?

Taking on too many clients leads to poor results and employee burnout. That’s why Silverback intentionally limits the number of clients its account managers handle in order to facilitate close, responsive relationships. 

“We always talk about clear expectations,” Louis Belpaire, Silverback’s chief operating officer, explains. “With the smaller client load, if there is work for a client that needs to be expedited, the turnaround is going to be much faster.”

Communication between agency and client is key to anticipating problems before they arise, building trust, and minimizing urgent calls or emails.

Question 2: How does the agency keep up with what is happening in the client’s business or industry?

In 2020 alone, Google made more than 4,000 changes to its search algorithm. In April of 2021, Apple’s AppTracking Transparency feature heavily impacted Facebook Ad campaigns. Major changes happening every few months is the status quo digital marketing.

Usually, on a week-to-week basis there’s not going to be major industry changes. But when there are, we’re ready to dig in and take action. For example, clients typically share changes in their business and industry during quarterly business reviews.

Silverback’s close relationship with major advertising platforms also gives the agency a leg up in terms of new product developments. Silverback clients often try new tools and learn about new advertising features. It’s the benefit of spending millions of dollars within these platforms each year. An in-house paid media team at a small or medium-sized business simply may not have the budget to reach this level.

Question 3: How do you know when to make a campaign adjustment?

It can be tempting to make immediate changes when a campaign appears to be underperforming. When new tools roll out from a major player like Google or Facebook, the temptation to dive in headfirst can be almost irresistible.

Managing ad platform changes is one area where agencies have an advantage over in-house teams. Within performance marketing agencies, marketing specialists and account managers are constantly exchanging ideas, talking about industry trends, new features, new platforms. Working with a variety of clients across a range of industries gives these specialists an opportunity to test new campaigns to see what works well and what doesn’t, then apply those learnings where appropriate. Through this, many agencies have compiled benchmarks of key performance indicators.

It’s these peer networks, tests, results and benchmarks that give agencies the insight they need to know when to make campaign adjustments or test new platform features.

Question 4: How important is communication?

We take client communication seriously. If we encounter a disengaged client, it can be hard to help them. There are times when a busy schedule may prevent communicating with an agency representative. While the occasional rescheduled phone call is part of doing business, agencies thrive on communication to understand your strategy and acting on opportunities.

Silverback facilitates client-agency communication in a number of ways. Basecamp serves as a repository for all files and conversations. Bi-weekly or weekly phone calls provide stakeholders with verbal explanations of project data and recent performance. With quarterly business reviews, the entire client team, including C-suite executives, can develop an overall understanding of the work completed so far and what’s planned for the next quarter.

Clarity is the essential aim of these conversations. A campaign may appear to be moving along well from the agency’s perspective until the client gets upset over the cost of new leads.

“One area where we usually don’t get enough information is the actual cost relief clients can afford,” Belpaire says. “They’ve either failed to calculate their true cost of customer acquisition or their return per customer in the long term. Sometimes that’s difficult for the client to figure out in the initial phases of the campaign. Once they start spending money, they’ll do the math and realize they gave us a margin either too big or too small.”

Question 5: What data is shared with clients? How do you give bad news?

A good agency keeps the best interests of the client in mind. We share reports and deliverables based on how campaigns have impacted the overall digital marketing objectives. Sometimes, this means delivering bad news. 

Eventually, every campaign will have a down month. In many cases, it can be a market trend or competitors being more aggressive. There are a lot of things that happen outside of a business’ control. An agency’s responsibility is to understand why, and what the response should be.

At Silverback, we regularly talk with clients. Our onboarding process includes thorough vetting, Basecamp threads, bi-weekly phone calls and quarterly reviews. This bring clarity to priorities early in the relationship to align objectives and our definition of success.

Then, account teams identify the KPIs to monitor specifically for a given client based on the business objectives. Once we establish metrics of success, Silverback’s analytics team sets up tracking and measurement to create a visual tool for communicating overall progress.

Question 6: How does a paid media account manager work with their counterpart on the in-house team without stepping all over each other’s work?

Here’s a nightmare scenario for a decision-maker who just signed a fat agency contract:

  1. Business hires an agency to handle a specific piece of company business.
  2. Both parties overlooked the onboarding process, or did not produce role clarity. 
  3. The agency makes no real effort to engage the in-house team.
  4. The in-house team neglects, de-prioritizes, or reverses agency work
  5. The decision-maker wonders why nothing seems to get done. 

No one is happy in this scenario. How do you avoid that kind of mess?

Building a level of trust is the most important first step. Agencies should explain the rationale behind recommendations and listen to the client’s ideas. When there is a disagreement, agencies and clients should have open, honest communication.

“We want the client to see we are very thorough with our measurement,” Belpaire adds. “Through that measurement, we gain their trust. It’s not easy every time, but when a client’s marketing manager can see our analytical resources support the work they are doing, everyone comes around.”

The choice between in-house vs agency comes down to a few key factors

Build an in-house paid media team if you want:

  • Fully dedicated paid media specialists in lock-step with your marketing strategy
  • To invest in hiring, retaining, and training marketing talent
  • Flexibility to adjust campaigns day-to-day 

Hire a performance marketing agency if you want:

  • Cross-channel and platform expertise 
  • Access to ancillary resources like creative and analytics 
  • Value from agency marketer peer network and benchmarks
  • Less technical work for your team, allowing them to focus on strategy

Which will you decide? Let’s start a conversation

Contact Silverback Strategies to learn more about our agency’s comprehensive approach to paid search and media marketing.

Carissa McStay

As Silverback Strategies' Director of Client Services, Carissa ensures client goals are translated into actionable cross channel marketing strategies that drive tangible business results. Connect with Carissa on LinkedIn.

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