By Jon Boroshok
From Silicon Alley to Silicon Valley, new "dot-coms" are quickly discovering that larger agencies aren't taking on new clients with retainers of less than $12,000 a month. At the same time, visibility is critical to start-ups, most of which are being severely outspent by more established competitors.
Young developers and engineers are the experts and visionaries behind many dot-coms, but marketing and PR are not their forte. By handling their own marcom, they may fall short of the excellence demanded in today's competitive marketplace.
Where can start-ups turn for marketing communications expertise? There are several alternatives - an in-house marcom staff, agencies, and independent contractors - each with pros and cons.
Large agency/small agency
Large agencies have vast resources at their disposal, and can offer a wide variety of personnel and services - of course, this overhead is passed along to clients. Larger agencies are best able to serve large, established accounts, which are more profitable and therefore garner the lion's share of attention from experienced players.
A smaller account may match up better with a smaller agency, where it will be bigger fish in a smaller pond, and more likely to be serviced by the senior staff. Unfortunately, a small agency doesn't always have the access to vast resources and talent that a large agency can offer. It's not unusual for a large or small agency to farm out work to an independent contractor, at a considerable mark-up.
Bring things in-house
An in-house staff means marcom pros are dedicated to your account full time as members of your team - they're not billing you on a project basis or marking up expenses. It's the lowest cost on a per-hour basis if there's enough work to keep the staff busy and cost effective. Otherwise, it's difficult for start-ups with limited funding to justify the expense of salary and benefits.
Outsourcing/independent contractors
Independent contractors are senior professionals that provide additional resources on an as-needed basis - supplementing an existing marcom solution and/or serving as extra support, or "relief pitchers" for employees on leave.
Independents usually charge by the hour or project, working faster and cheaper than agencies. Many offer a full range of services, including company/product launch and rollout, media and analyst relations, case studies, customer success stories, white papers, collateral, ad copy, company newsletters, Web content development, special event organization, and trade show support.
Here's some advice for tech start-ups searching for a marcom solution:
* Myth: If an agency can service "EveryoneOnline.Com," they can service a start-up. Reality: Large agencies match up best with larger, established clients. Working on an established account, a PR pro can become complacent and forget how to be proactive introducing a start-up. Small accounts may initially receive senior staff's attention, but will soon be serviced by less costly/less experienced juniors. Start-ups are harder to work on and need seasoned professionals.
* Agencies love to drop names of their media contacts - but they may not be the right reporters, editors, and analysts for your company. Experienced pros quickly develop new press relationships as needed.
* When reviewing agencies, make sure the people pitching to you will be the same people that will be doing the actual account work. This should be written into the contract.
* Location may be most important factor when buying a house, but not when selecting an agency. A prestigious address does not make an agency do better work or increase the chances of media coverage. Would you rather pay for the view from your agency's conference room or pay for results? How easily can you or your agency travel to/from each other's offices? What's your time worth?
* Independent contractors are a limited resource, often working simultaneously for several clients. Make sure they have the bandwidth to take on additional work for your account and can meet your deadlines.
* Your in-house staff should be experienced enough to do the job alone and handle periodic spikes in the workload. In a tight labor market, ensure they're well compensated to lessen the attraction of offers from a competitor or agency.
* Chemistry counts - you'll have regular contact with your marcom professional. Marcom pros should be experienced in their field and must be able to learn your business quickly. A start-up's marcom needs and funding vary from month to month - your marcom pro must be flexible. Marketing communications is an investment. Selecting a source that matches your company's culture/personality is likely to give you the best return.
Jon Boroshok is president of TechMarcom, a marketing communications firm in suburban Boston.