February 26, 2011

The Top Ten Reasons Companies Outsource Their Marketing

Outsourced Marketing is a “best value” solution through which growing businesses are able to access a range of state-of-the-art services and resources. Results are shifted from an internal to an external marketing department. The benefits are numerous: in addition to a sizable cost savings, outsourced marketing allows you to better focus your resources, free up time of valuable personnel, project a more professional appearance, access better technology and capabilities, leverage increased flexibility, and more.

In today’s economic climate, outsourcing with the intention of decreasing costs has become increasingly important in order to attain or maintain a competitive advantage. According to a recent Harvard Business Review article, over 53% of marketing executives reported that they plan to outsource their marketing.

Cutting costs is just the beginning. The additional benefits of outsourcing lie in the value it creates.
  1. Improve company focus Outsourcing allows managers and key personnel time to focus on a business’ core competencies, where they are of more value.
  2. Access superior capabilities Outsource providers bring in-depth expertise in a particular area which helps companies better satisfy customers and increase productivity and efficiency.
  3. Access better technology You can tap into leading-edge technology that is used in conjunction with specified areas of expertise. Keeping up-to-date with such technology is timely and costly.
  4. Shared risk Outsourcing enables a company to share some of its risk, such as unstable workflow and capital investments. The outsourcing provider is able to spread those risks over multiple clients.
  5. Free-up resources Outsourcing allows a company to shift its resources to activities that have the greatest impact on bottom-line performance.
  6. Increase working capital The outsource provider share the investment as part of its own overhead.
  7. Improve cash flow Outsourcing a function that is currently carried out in-house may allow the sale of assets that are no longer internally necessary.
  8. Reduce operating costs An outsource entity can generally provide the same the function for less because of economies of scale, thereby reducing the functions cost to the business.
  9. Accommodate growth Outsourcing is ideal for companies undergoing rapid growth because expansion can occur more easily without derailing current operations.
  10. Alleviate management pressure Managing functions that can be outsourced is a significant drain on resources.
Source: The Outsourcing Institute


By Jennifer Pricci

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