Freelancers may be cheaper, but what is it really costing your business?

As businesses grow, they inevitably need more people in specialist positions to help support that growth. Marketing should be a key function in any successful business, and knowing how to resource it properly, including investing in the right people, processes and technology, is critical. There are three common ways to meet the resourcing needs of a growing business: hire, appoint an agency, or use freelancers. Let’s take a deeper look.

Choosing the right talent model

In today’s labour market, hiring and retaining talent is difficult. Additionally, marketing is such a broad discipline that trying to find one or even two people to fulfil an entire marketing department’s needs is impossible. If you think about it, the marketing umbrella may cover anything from digital marketing, SEO, advertising, social media, website development, graphic design, and copywriting, right through to partner marketing, event marketing, branding, internal communications… the list goes on. Inevitably, your new marketing recruit will focus on the area that they’re most competent in, and leave the rest to be either outsourced or forgotten about entirely.

So what next? Many business leaders turn to freelancers to fill certain skill gaps in the company. And often, at least in the early stages, it can be a smart move. For one, freelancers can be cheaper than hiring internally or using an agency. So, your company will only pay for what it needs, which is a major benefit for start-ups that need to be lean and agile to survive. But, as time goes on, there are hidden costs for managing a growing list of siloed and remote freelancers. Read on to find out why.

1. Micro view of tasks

Freelancers are hired for the specific task or project that you’ve briefed them on, and are therefore micro-focused on completing that. Unless they’re a strategy consultant, it’s very rare for a freelancer to be thinking ‘big picture’ about your brand and bringing ideas to the table that extend beyond their scope. Instead, freelancers will expect clear instructions to deliver exactly what you’ve asked. This approach limits creativity and lateral thinking and also makes it incumbent on the business owner to have the vision and know exactly what they want.

2. Limited skillset

One of the reasons that businesses end up with a string of freelancers is that hiring managers quickly realise that their freelancer is a specialist in one field only. It’s very hard to find a freelancer with a broad range of focused skills, which means you might have to go looking for more than one freelancer. For example, if you use a graphic designer to create flyers for your business, you can’t expect or rely on them to also become your photographer, videographer, animator or illustrator. You’re going to need a team of people for that. Explaining your vision again and working with more than one freelancer can be time-consuming.

On the other hand, with a digital agency, you’ll get a group of experienced marketers that will likely have a huge range of skills. You won’t need to repeat your vision and they’ll all be on the same page when it comes to what works best for your business.

3. Unpredictable quality of work

It’s often harder to vet freelancers when compared with agencies (who usually have a significant digital footprint) and job candidates. Therefore many hiring managers award freelancers the gig without too much thought for their experience or qualifications. Additionally, freelancers are often juggling various commitments and projects on top of the stress of managing their business, and may not always have the appropriate time to dedicate to your business. Over time, this may lead to inconsistent quality of work or poor communication and you’ll find yourself chasing up work.

4. Lack of resources

Many freelancers go out on their own for the lifestyle benefits and enjoy the freedoms of working to their own schedule. They also tend to take on projects on a first-come, first-served basis, filling their capacity quickly. This can be at odds with a company’s need for fast-turnarounds and you may find that your freelancer isn’t available to work on your project when you need them to. This adds stress to a business owner, who may be left scrambling to find someone new to do their important work. In this circumstance, it’s better to use a digital agency which will have more resources in place to finish up your project quickly.

5. Lower investment in your company

Like everyone, freelancers have bills to pay. So, thinking you’re their only client would be akin to thinking that your waiter is only working his shift tonight to serve you. Almost all freelancers are juggling multiple projects at once, so their loyalty to your brand is probably lower than a full-time employee or agency who you’ve been working with for a long time. Freelancers tend to have a short term focus and can therefore be more transactional in their approach.

6. You still need to manage them

Many business leaders recruit freelancers because it can seem easier than the burden of hiring, training and managing staff in house. After all, they’re sole traders, so they can look after themselves, right? Wrong. Freelancers need just as much guidance and briefing to complete a project as an internal staff member would. Sometimes, they need even more guidance because they don’t have the internal knowledge of an employee to lean on, and can’t go to anyone else to get that. When business leaders have a string of independent freelancers, the time for managing them all multiplies as you need to deliver the same information again and again, as opposed to sharing team information through internal communication channels.

7. Lack of ability to train them

When you hire a freelancer, you can’t expect or require them to undertake formal training or upskilling. You hire them as is, based on their existing qualifications and experience. While some freelancers upskill, not all do, as there is rarely an incentive to do so. So they may not be aware of the latest technologies, trends or processes when compared to an agency who must have their fingers on the pulse to stay relevant and competitive. Additionally, internal staff members who are looking for a promotion have incentives to grow and you can also require them to take formal training to address any skill gaps.

8. Inconsistent and disparate marketing

One of the biggest cons to using freelancers for your marketing, particularly if you use several independent contractors, is that your campaigns will have some degree of inconsistency and may not be as cohesive as they could be. This is because every freelancer will have a different take on the work, and will not be privy to what the other parties are doing, let alone collaborate with them. One of the best things about using an agency is that you have just one point of contact, but the whole team will collaborate closely to ensure that everything is cohesive, consistent and streamlined. This leads to far better results because everyone is working together for success.

9. When they leave, so does your IP

Unfortunately, given the transient and remote nature of the gig economy, sole traders move about a lot and sometimes disappear without a trace. They also won’t always insist on contracts which can sometimes bring up legal issues if they don’t complete the work.

Additionally, in Australia, the percentage for small business failure is high. Many freelancers don’t make it past the first three years in business. And, if they do, they are likely to change their business models several times as they learn how to manage their market.

This presents challenges for business in terms of information management and having the ability to access and update files as the years go on. It’s not uncommon for us to work with a new client who has a website managed by one person, a document managed by another person and a video file being managed by another person, without any passwords or access. Often, as an agency, our first month spent with a new client involves unravelling the past web of passwords, assets and files held by various contractors and centralising everything to ensure  the business takes back full control.

The agency model solves these pitfalls

While getting work done cheaply, and often quickly, by various freelancers can seem like a great option, you should always consider the risks that come with it. Unlike a freelancer, an agency works more as a partnership relationship with a vested interest in your long-term success.

If you’re interested in an agency to make strategic decisions and get better results for your business, please say hello.

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Image of Laura Prael, Director of LEP Digital

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