Why In House Design Makes Sense For Large Companies.

Having talked to people of large corporate companies and knowing people who work at large corporate companies, what has amazed me constantly is how many companies outsource a good portion of their work to smaller web design shops. It’s not necessarily a bad thing to outsource some of your site, but when you outsource the majority of work on your site to a third party it boggles my mind. Even things such as SEO and SEM are often outsourced to these smaller companies, and I think this is a big mistake.

I know a lot of companies have outsourced their website work, SEO or SEM activities because of how the money flows in a company. Usually every business unit gets its own budget and feels they want to dictate what is created for their marketing campaigns, events or whatever they are doing. It makes sense from a traditional stand point. Go back 10 or 15 years and most media was print, radio or television. These are things that are not easily done in house due to the high costs and real-estate need to either film, record audio or perform photo shoots. To which the production was then taken to a medium that then typically distributed by a third party company networks, news paper, magazines, etc.

The web changes this. All the tools you need to create, and sustain your site are tools that can be kept on local site premises, and take up very little real-estate. The only component to your site you may want to consider keeping with a third party is your actual web server and web server support (tape back-ups, security patches, and other low level stuff). All your front end and top level work such as graphics, coding, HTML, database administration can be done locally. If your company is new to the web and uncertain of what you need an agency is a good start, if you’re web presences is established (a year or longer) you have a pretty good idea of how much maintenance work your site will need. Depending on the company size you are probably making updates every day if you are a large corporation. Even if you are a small business if you do most of your business through online means you may want to consider in-house.

Here’s why. For large corporations bringing a resource in house means reduced costs, more work and slower reaction times. A typical agency engagement requires a statement of work, opening a PO or setting up a retainer, the agency will also need several people to manage the relationship the price you pay for the work done needs to cover all these peoples wages as well. There’s also usually a minimum cost for any work request. This changes from agency to agency and some are really great at making changes within reason without additional costs, others will nickel and dime you for every change you ask for.

How Much Does This Save Me?

So assume the cost of an employee too be $100,000 for the year (this will include benefits, vacation, everything above and beyond base salary) it may actually be less, but lets assume we’re trying to get some top notch senior people. A junior person may run as low as $30,000 for the year again depending on benefits and everything else. Also there are regional differences and you also get what you pay for, you will also keep your talent more likely if you pay them appropriately. But lets assume worst case scenario of $100,000 for the year. That person should be proficient in: HTML, CSS, PHP or ASP, and some database design, and coding. They should also be comfortable to use Photoshop.
This one person should be able to create for you 3-4 HTML pages a day if they have been clearly defined, in 2-3 weeks basic tools that will help sustain your business (a rating and review tool, or simple contact forms, an event registration tool, these are all smaller projects you should be able to do in house.)

If you were to get an agency to quote a cost for an HTML page, the cost will run from $500-$1000 maybe more, probably not less. Let’s assume you product 1 web page a day in 100 to 200 days you will have recovered your investment. A working year for an employee is usually about 226 working days. Those last 26 days are basically free days of extra work you’re getting a savings of $11,504 to your bottom line. However over the course of the year you will also want to make changes to existing web pages, so assume a minimal cost of 100-1000 dollars per cost depending on the changes. And assume you make 2-3 edits a day. That is anywhere from $22,600 to $226,000 in additional savings. Bringing in this one roll in house has now saved you $34,104 to $234,104 in savings depending on how active you are on your site and what your agency fees are.

If you are looking for a graphic designer the cost savings will be similar as above. Your graphic designer is going to be pretty busy as well, if you want your site to look good. They will be working tightly with your coder from above and changes to images typically cost a lot more than a change to HTML. The other thing is if you pair your coder and graphic designer together, you can start to get some pretty cool micro-sites developed, expect development time to run about 6-8 weeks for a micro site, also expect to pay $50,000 to $100,000 or more for a micro site from an agency. So plan for two micro sites a year and you can recoup your cost on both employees in that 6-8 week span. Our savings has now moved to $134,104 to $434,104 with 2 micro sites plus the creating of 1 web page a day and updating 2-3 existing pages. This should be pretty reasonable for skilled employees of the top caliber to perform.

What I would then ask you to do is take your savings and invest it into a good project manager so another $100,000 you’ll still have $34,104 to $334,104 in savings over the year, this project manager will also be the one keeping track of the volume of work you have coming in so you can figure out if you need to scale up or not. They should also be able make sure that your site has some good cohesiveness. My thought is that your Information Architect and your Project Manager can be a blended roll if you’re a small site, if you are a large site you will want to separate these rolls but you are also probably closer to the $334,104 savings end than the lower end so you’ve got lots of wiggle room still budget wise.

Finally your SEO/SEM specialist you will pay a premium for this service from an agency. But again if you are constantly running paid search campaigns, then bring in an SEM specialist. Setting goals with that specialist to reduce your cost per click, to improve the leads generated to higher purchasing leads, and to ultimately move your SEM projects forward. SEM isn’t a part time job, nor is SEO. If you want to have higher organic search rankings then SEO MUST happen every day. You can’t bring in an agency for 4 or 5 months to improve your SEO, SEO needs to be a daily practice and needs to done every day. A solid SEO or SEM person should also pay for their services in what they either generate as new business or cost savings through your paid search campaigns. Agency costs for SEO and SEM are at great extremes these days so I won’t set a bench mark, instead what I suggest is that you need to figure out how important search is to your business, in some cases search really doesn’t help nor matter. It’s all about leads and how strong they are. If you think search is a daily activity then I suggest you make it a job in-house.

It’s Not Just All About the Dollers

What’s the benefit of bringing all these people in house? They work for you. They work for what is the best for YOUR company. There is no additional pressure from an agency to sustain the business, or grow the business. There is only one objective for these employees do what is best for YOUR company. It’s amazing what kind of shift happens when employees are working to the betterment of only company. I have been fortunate to work with agencies that are very good at working collaboratively, honestly. But I’ve also seen the dark side of companies that work in their own interests first then your companies secondly, those agencies are like money pits, that never really product any work that is tangible.

I don’t want to come across anti-agency, but if you are a large corporation whatever you can do in house you should, it only makes good business sense. The fact is the web isn’t going away, it’s the primary form of communication for a lot of business today, you want to have the best people who actually DO the work in your company to advise you on what to do next or what is missing. Having these people in house you have the freedom to change and edit things on the fly. You also make these people part of your corporate culture. There’s some pretty powerful stuff having people become part of your culture.

If you’re a small business you may want an agency to do your work or if you aren’t creating the volume of work I’ve described then again you may want an agency model, but if day in and day out your business creates online content, it’s time to think of bringing the content creating back home.

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