The Costs of an Internal Small Marketing Team/Dept.

One of the biggest considerations we see when talking to prospective clients is the total cost of partnering with an agency like us versus building their own team. Typically, once companies see the total cost, the real value becomes super clear. Here is the most straightforward financial and operational breakdown for a small marketing team:


Building a three-person internal marketing team would cost $250,000/yr.


Breakdown of Costs

This calculation encompasses the salaries for a Marketing Director, a Digital Marketer, and a Graphic Designer. We’ve opted for mid-range salaries considering the diverse roles these individuals must undertake within small businesses. Additionally, we've factored in a 25% increment to accommodate taxes and benefits.

Salary Breakdown for a Small Marketing Team:

 
 

Technology Expenses

Aside from salaries, we must consider the basic technology essential for the team's operations. This includes laptops, Microsoft Office and Adobe subscriptions, data storage, and stock art subscriptions. The total annual expense for these tech essentials can vary between $5,000 to $20,000 per year, depending on the kind of content and work.

 
 

Services Provided by the Team

This compact team should capably handle fundamental marketing tasks for most small businesses, encompassing direct outreach, email marketing, social media management, digital advertising, print materials creation, and continuous website content management.

Exclusions from the Estimate

  • Advertising or Printing Expenses: Costs related to third-party services are not included.

  • Web Development: While the team can manage basic website content, technical maintenance typically necessitates specialized expertise.

  • Copywriting: While the Marketing Director may handle basic copywriting, specialized writing needs may require additional resources.

  • Professional Photography or Videography: The use of professional equipment is not accounted for in this estimate.

  • Project Management: Professional project management tools or personnel are not included.

  • Training or Continuing Education: Costs associated with ongoing education are not factored in.

  • Time: Opportunity cost that goes toward the time to post jobs, vetting process, hire, plan and build the team.

Cost of a Highly Experienced Team

For those seeking a "Dream Team" with seasoned professionals, the expense increases significantly, nearing $1,000,000 annually. This includes high-end salaries for all team members, a Chief Marketing Officer (CMO), additional roles like copywriters and project managers, as well as enhanced technology provisions. This “Dream Team” also takes a long time to assemble and can take several years to complete, and is often never actualized due to the trending low talent retention rates and decreasing average tenure. 


Building a “Dream Team” internal marketing team could cost almost $1,000,000/yr.


 
 

Cost of a Marketing Agency

The pricing structure of marketing agencies varies based on several factors. Specialization, expertise, niche industry knowledge, and catalog of services will determine the total cost of working with an agency. Although exact figures fluctuate, here's a breakdown of average monthly retainer costs for hiring a marketing agency in the US:

Average Cost: $4,500/mo

Low End Cost: $1,800/mo

High End Cost: $12,000/mo


COST COMPARISON | Dept. vs. Agency

Avg. Internal Team/Dept: $248,364/yr

Avg. Agency: $54,000/yr


Industry Specifics

The industry in which your business operates has a big impact on the cost of hiring a marketing agency. While many agencies cater to diverse sectors, you might seek one with specialized knowledge of your industry. Agencies with diverse clients can bring unique experiences and expertise to your industry, while specialized agencies can have deeper knowledge of your business, making the process much more efficient. Like all choices in life, there are pros and cons to working with each type of agency. 

The Value Proposition

Deciding whether to hire a marketing agency often boils down to weighing the benefits against the costs. While some businesses opt for in-house marketing teams, others leverage the advantages of outsourcing to external agencies.

One significant advantage of outsourcing is gaining access to a diverse pool of expertise without the commitment of full-time hires. Marketing agencies typically house specialists in areas like strategy, positioning, digital marketing, social media, SEO, content creation, and web development etc. allowing you to tap into their knowledge as needed.

While an internal marketing team or department may sound appealing, the time it takes to build the team is long and arduous. Agencies have the advantage to be practically turnkey for most businesses. There’s typically an initial onboarding process that gets the agency up to speed on the client’s needs and wants but not comparable to the several months it would take to build a team. 


Partnering with a marketing agency can save you precious time and effort, enabling you to focus on core business activities. While the agency handles marketing and promotional efforts, you can concentrate on your business.


Tailoring to Your Needs

Every organization's requirements vary. It's crucial to assess your marketing plan (if you have one — if not, you’ll need to also design a strategy and plan or hire someone who can do this) to determine the requisite skills and resources. While the teams outlined here may suit some, your unique circumstances may demand different configurations.

Seeking Marketing Assistance?

If you're looking to work with an agency or planning to build your own team, we can help. We offer specialized expertise across various industries, including fractional CMO services to complement existing teams and a full suite of services so you don’t have to build a team.

David Bara