Marketing Agency vs In-House Marketing: Which Is Better for Small Businesses?

This is one of the most common questions I’m asked.

Sometimes it’s direct:

“Should we hire a marketing agency, or bring someone in-house?”

Other times it’s implied:

“We’ve tried agencies before.”

“We’re thinking about hiring a marketing manager.”

“We don’t know what the right next step is.”

What’s interesting is that there isn’t a single right answer.

But there are wrong decisions — usually made without understanding what each option actually involves.

This article is here to do what most marketing websites won’t: Give you an honest, side-by-side comparison, so you can decide what’s right for your business.

Why This Decision Matters More Than People Realise

Marketing isn’t just a line item.

It affects:

• Lead flow

• Cash flow

• Team confidence

• Growth plans

Choosing the wrong route doesn’t just waste money —it creates frustration, resets momentum, and makes owners lose trust in marketing altogether.

That’s why this decision deserves clarity, not sales talk.

Option 1: Hiring a Marketing Agency

Let’s start with agencies, because this is where many businesses go first.

What a Marketing Agency Typically Provides

A good agency brings:

• A team, not just one person

• Experience across industries

• Processes, systems, and structure

• Speed (things usually happen faster)

Instead of recruiting, onboarding, and training, you’re tapping into something that already exists.

The Upsides of an Agency

For many businesses, agencies make sense because:

You get access to multiple skill sets

Strategy, content, ads, SEO, design — without hiring five people.

There’s less management day-to-day

You’re not responsible for someone’s workload, development, or holidays.

You benefit from an external perspective

Agencies see patterns across many businesses — something in-house teams rarely get.

You can move quickly

Campaigns, launches, and changes don’t rely on one person’s capacity.

The Downsides (That Often Get Glossed Over)

Agencies aren’t perfect — and pretending otherwise is unhelpful.

Common challenges include:

You’re not always the top priority

Even good agencies juggle multiple clients.

Context can be missed

An external team will never live and breathe your business in the same way an employee does.

Poor fit causes frustration

If strategy isn’t clear, agencies can end up “doing activity” rather than driving outcomes.

Cost perception

Monthly retainers can feel expensive — especially if expectations weren’t set properly.

Agencies Work Best When…

From experience, agencies work best when:

• There is strategic clarity

• Expectations are clear

• The business wants execution support

• Leadership understands their role in direction-setting

Without that, agencies get blamed for problems that aren’t execution issues.

Option 2: Building an In-House Marketing Function

Hiring in-house feels attractive for different reasons.

It feels closer. More controlled.More aligned.

But it also comes with realities that are often underestimated.

What In-House Marketing Actually Looks Like

An in-house hire is usually:

• A marketing executive

• A marketing manager

• Or a generalist expected to “do marketing”

That one person is then responsible for:

• Strategy

• Content

• Social

• Email

• Analytics

• Sometimes ads and SEO

That’s a lot to put on one role.

The Upsides of In-House Marketing

In-house can work well because:

They’re embedded in the business

They understand culture, clients, and nuance.

They’re available day-to-day

Quick changes and ideas can happen fast.

Long-term knowledge builds up

Over time, internal understanding deepens.

Alignment feels easier

They’re part of the team, not an external supplier.

The Downsides (That Catch People Out)

This is where expectations often clash with reality.

One person can’t do everything well

Marketing today is too broad.

Hiring mistakes are expensive

Salary, tax, pension, training — and time.

They still need direction

Without strategy, in-house teams stall or default to “posting”.

Skill gaps are inevitable

Even strong marketers have blind spots.

In-House Works Best When…

In-house works best when:

• There’s already a clear strategy

• Leadership knows what “good” looks like

• Marketing is a long-term investment

• Support and development are planned

Without that, in-house marketing becomes busy — but not effective.

The Question Most Businesses Should Be Asking Instead

Here’s the part most comparison articles miss.

The real question isn’t:

Agency or in-house?

It’s:

Do we have clarity?

Because without clarity:

• Agencies execute the wrong things

• In-house teams drift

• Money gets spent without confidence

This is where many businesses get stuck — bouncing between options without ever fixing the root problem.

How the Marketing Mix Helps Decide the Right Path

This is exactly why I built the Marketing Mix framework.

Before deciding who should do the marketing, the framework focuses on:

• Clarity

• Visibility

• Engagement

• Conversion

• Consistency

Once those foundations are clear, the right delivery model becomes obvious.

For example:

• If strategy is clear but execution capacity is low → agency support often makes sense

• If direction is strong and long-term commitment exists → in-house can work well

• If neither is clear → neither option performs properly

The framework doesn’t force a choice.It creates the conditions for the right choice.

The Hybrid Approach (Often the Smartest Option)

In reality, many of the strongest businesses use a hybrid model.

That might look like:

• Strategy + oversight externally

• Execution internally

• Or an in-house lead supported by specialist partners

This combines:

• Strategic clarity

• Internal knowledge

• External expertise

It also spreads risk and builds capability over time.

Cost Comparison (At a High Level)

While costs vary, it’s worth being realistic.

An in-house hire often costs:

• £35k–£55k+ salary

• Plus tax, pension, training

• Plus management time

An agency retainer might cost:

• £1,000–£3,000+ per month

• With access to a team

• But without full internal focus

Neither is cheap. Both are investments.

The mistake is choosing based on monthly cost alone.

Final Thought - TLDR

There is no universally “better” option.

The wrong choice is made when:

• Expectations are unclear

• Strategy is missing

• Marketing is treated as a quick fix

The right choice is the one that fits your stage, goals, and capacity.

When that alignment exists, both agencies and in-house teams can work exceptionally well.