In 2015, 32% of marketing budgets were spent on external marketing services according to the Gartner 2015/2016 CMO Spend Survey. While that figure represents a significant slice of the budget pie, more importantly it means the stakes are high: Marketing teams rely heavily on these external service providers to compete in a complex environment. And it’s only growing more so.
To support the broad and rapidly changing scope of marketing, marketers must revisit how they discover, consider and engage outsourcing service partners, noted Chris Ross, research director, Gartner for Marketing Leaders.
Today’s external partners range from full-service agencies covering an expansive set of services to crowdsourcing input or support from the larger digital community. Or think of other partners such as executive free agents, managed and freelance marketplaces, marketing technology vendors and boutique or specialty agencies. According to Mr. Ross, the key to an effective external partner strategy is to understand the criteria that will help select the right portfolio of external partners.
Six criteria to assess what type of external partner to engage
- Flexibility – One of the most valuable aspects of working with external partners is the “elasticity” and responsiveness they can provide. It’s important to be able to scale up quickly or respond to changes in direction or scope. When assessing potential partners, consider what level of responsiveness your organization will need.
- Range – Determine how broad a set of capabilities you require from a partner. Are your needs narrow and tactical such as search engine marketing? Or do you have more expansive needs including strategic work or a wider array of services?
- Duration – The timeline for engagement can play an important role in partner selection. Use a different approach for temporary support than more expansive partner relationships.
- Difficulty – Do you need skills to fill a highly specialized role requiring deep expertise in a narrow area? If the skill set or capability you’re seeking through an external partner is complex, rare or specialized this can make external partnership an intuitive choice.
- Cost – Many decisions about working with external partners involve comparing the external partner cost to the cost of developing the required capabilities in- house. Factor in the frequency of skill utilization, consistency of need over time and talent skill relative to other desired capabilities.
- Stability – Volatility within the partner organization can radically impact the partner relationship. Develop a clear understanding of partner track record and approach to staff changes and (to the extent possible) the overall financial health of the organization.
“Be aggressive, but selective, when using external partners,” noted Mr. Ross. “A wider and deeper partner landscape opens up new potential for innovative marketing organizations.”
