Should You Outsource Demand Generation in 2018? Pros vs. Cons

68% of companies report a struggle to generate leads, according to a Lattice Engine/CSO Insight study. It's hard to shift your thinking from quantity to quality when there's simply not enough volume in your pipeline.

If demand generation were easy, every B2B marketing organization would be hitting home runs on demand. While it's much easier to scale multi-channel demand thanks to innovative marketing technologies, it's still hard work. As a result, some brands choose to outsource some or all of their demand generation activities.

Is outsourcing demand generation the right move for your organization?

In our work with mid-market and enterprise B2B marketing teams, we've learned a thing or two about the pros and cons of outsourcing demand generation that may help you decide whether or not outsourcing demand gen is a good fit for your organization.

Common Motivations for Outsourcing Demand Generation

Ultimately, the right approach to outsourcing, insourcing, or a combination depends on your organization, priorities and motivations for working with a third-party. No two companies are the same, and your experience with outsourcing will vary depending on your own expectations and the parties you choose to partner with.

Lack of Manpower

Demand generation can be time consuming and difficult. For smaller organizations or those that run on lead budgets, there simply may not be enough seats on the marketing team to execute a fully orchestrated demand generation strategy. Nick Iyengar writes in MarTech Today that "finding quality talent" is a top challenge for digital marketing teams, resulting in too few employees to carry the weight of generating demand.

Lack of Funds

While the majority of companies are securing higher demand gen budgets for the year to come according to Demand Gen Report, it's not always enough. Organizations may find that outsourcing can make the most of a flat or insufficient budget.

Lack of Expertise

To properly generate demand and orchestrate multi-channel campaigns, B2B marketers must have a wide knowledge of MarTech, analytics and other digital capabilities. Some companies outsource due to a skill gap in their team and difficulty hiring the right marketing talent. For others, the broad expertise offered by agency outsourcing is simply cheaper than trying to hire several experts.

Lack of Results

Some companies have already exhausted available resources and they're just not getting the results they need. They may have tried hiring new employees or invested in smarter technology with limited return on investments. Lack of results is often related to a lack of knowledge, in which case a third-party may be the right road to better returns.

Advantages of Outsourcing Demand Generation

When B2B marketers are happy with their decision to outsource, what are the most commonly reported advantages? While most experiences with outsourcing include both positive and negative factors, some frequently stated pros of outsourcing can include:

1. Expert Assistance

Resources provided by the outsourced company may be more advanced than what's offered by internal staff. Partnering with an agency or seasoned consultant typically provides industry-specific knowledge, expertise and insight that can help you overcome demand generation challenges.

2. Access to a Variety of Skill Sets

When hiring an agency, you may have a variety of skillsets at your disposal. This could include content writers, ad design experts, survey researchers, systems integrators, lead generation specialists and other niche skillsets on demand. So even if your team is kicking ass in some areas, external resources can help you tap into new demand generation opportunities to impact pipeline and drive revenue.

3. No Waiting on Training

When you hire internal demand gen team members, there's almost always an onboarding gap that slows down implemention of new demand generation methods and tactics. Outsourcing can significantly speed up the time to market by providing access to fully trained marketers able to hit the ground running.

4. Easier Access to Termination

Depending on the terms of your agreement, outsourcing may present a relatively low-risk way to run demand generation especially compared to internal initiatives. Organizations who want flexibility should pursue a partnership that includes scalable services or month-to-month agreement terms.

Disadvantages of Outsourcing Demand Generation

Likewise, there are risks to outsourcing demand generation, which range in significance and impact. Most risks though can be mitigated through smart partner screening and expectations management.

1. Management Requirements

Even though the actual tasking is outsourced, there still needs to be an internal team member assigned to managing each partnership. Depending on the experience and extent of your outsourcing agreement, managing agencies or third-party demand generation vendors can require significant resource commitments.

2. Communication Issues

Friction and miscommunication issues can occur, and are often due to mismanaged expectations. These communication issues may be slightly disruptive or devastate your outsourcing experience. Taking the time to clearly define strategy, processes, goals, desired outcomes and progress can greatly reduce the chance of communication issues. Be sure to have regular (whether weekly, bi-weekly or monthly) check-in calls, and agreed upon methods for providing real-time feedback.

3. Lack of Transparency

Vendors vary in exactly how much client visibility is offered. It's not uncommon for marketers to feel like they've lost visibility into lead generation efforts, sales funnel and the progress of your projects. By ensuring both parties have access to shared data, you can help to create data accountability. 

4. Possible Lack of Understanding of Your Brand Values

Brand values are important and your standards, voice and values are unlikely to be immediately clear to your vendor. Prepare to provide clear and concise brand and industry guidelines for best results and look for vendors that have a formalized client onboarding process in place.

5. Loss of Agility

When working with agencies, miscommunications around project specs or campaign expectations can result in greater delays than internally led efforts. It's easy to lose agility and the ability to pivot quickly, depending on the processes you have in place with your partners. 

Is Outsourcing Right For Your Marketing Team?

Outsourcing can bring in multiple experts you couldn't afford to hire individually, and put them to work for your company without paying for training, benefits or vacation time. With that said, a lot of people mistakenly think of outsourcing as hands-off, when it's exactly the opposite.

Someone has to manage third-party relationships to ensure goals are met and deliverables are on point. Without someone on your team to dedicate the time and effort to that job, you run the risk of downgrading results.

If you weigh the pros and cons of outsourcing demand generation, and decide it's the best option for your organization, do your due diligence and research multiple vendors to find the right fit. With an understanding of your options and careful vendor screening, you can hire the right kind of support and expertise to exceed your marketing targets, increase sales pipeline and drive more revenue for your organization.

Still not sure if you should outsource demand generation activities? Check out the B2B Demand Marketing Assessment Guide & Orchestration Workbook to get an accurate benchmark of your current levels of effectiveness. It will help you identify current areas of strength and opportunities that will your demand gen efforts to the next level.demand-marketing-assessment-guide

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