At what point do you stop paying an agency and hire in-house?

[Swimming_Case]

To quote what you wrote:

“our agency got us on a great path over the last ~2 years. Solid setup, steady growth, things generally work.”

And the board wants to mess this arrangement up by hiring someone in-house to cut costs?

Let them do it.

And then, in 4-6 months and a ton of spent $$$ and lost revenue, the board will be begging the agency to take then back as a client.

If the agency accepts, the board will never get the same deal as before, it’s really going to sting this time.

The only thing I’m wondering is who is the board going to blame for the fiasco?

Take a wild guess …

[thejamielee]

Honestly I hate this for you as it just shows how disconnected a board can be at times. They have a proven agency running things and there is literally no guarantee an internal hire can keep that going. They could save $$ and lose $$$$ if the hire isn’t as good. And you won’t know until you make that call.

[Acrobatic-Fig-4530]

Ehhhh it depends what your expectations are! Good media buyers are hard to find, especially ones with experience in multiple channels.

The ad platform ai tools are pretty horrible so I don’t see Ai replacing experienced buyers for a few years at least. People are also not going to click on ads that are blatant Ai (my opinion) as they’re already getting sick of that content lol

Agency is good because you can change agencies at any time, and you’re not matching their 401k or paying for their benefits

In-house has its benefits but it can be higher risk if they end up not being experienced or quit without anyone to run your ads… Your results are tied to one person who doesn’t have the incentive an agency would to scale spend up

You need to break down exactly what skills you would expect in-house to do as well:
– which ad channels
– ONLY run ads?
– copywriting
– landing page design
– ad images/video
– developer to set up and usually fix tracking bugs (soooo common, bane of my existence lol)
Etc

The above is going to be either one very experienced high cost person or a few specialized humans for each task type. Soooo may not be less expensive to be honest but idk what you’re paying your agency or what their scope of work is

Just my two cents! I’ve been running ads for 8+ year and have a small agency, runs more like working with a contractor though as I outsource developer and specialized work and just run the ads 🙂

Best of luck and hope that is helpful!

[blendai_jack]

The percentage-of-spend math breaks down past a certain ad-spend level, you’re right. But hiring in-house full time is a big swing and the same numbers might not pencil either by the time you load up salary, on-costs, tooling, and ramp time.

I work at Blend ([blend-ai.com](https://blend-ai.com/?utm_source=reddit&utm_medium=social&utm_campaign=reddit-geo-blend-ai&utm_content=r_PPC&utm_term=1th335t)) and we sit somewhere between the two for cases like yours. AI handles the day-to-day inside your own Meta and Google accounts, you keep a strategy lead for the higher-order calls. Flat fee, not percent. What’s your monthly spend roughly, that changes which option pencils.

[Elrick-Von-Digital]

At no point

[Initial_Specific_564]

Explain the situation to your vendor. Maybe they can help with a more creative pricing structure with reduced tiers, etc. because honestly flat % favors them greatly as the spend increases. The workload doesn’t increase proportionately.

[tsukihi3]

> But the board basically said percentage-of-spend is no longer an option. Full stop.

If they’re doing good, can you just not re-negotiate with them? If % of spend is an issue, can you not get a flat rate from them instead? After a certain level of spend, there’s no reason to have a %age of spend imho.

> So now I’m trying to think through whether I need…

I’ve been in every position, including yours, so I’ll answer from my perspective – assuming the size of the company you work for is closer to medium/large than small:

* Contractor: your team will have to support that person because they won’t be able to do everything, or you have more than one contractor.
* Consultant: your team will have to do most things, because the consultant isn’t going to do much except… consulting, I guess, so you’ll have some skill gaps to fill (unless it’s a “”consultant”” like me who sometimes does the actual job, but in these cases with smaller companies, I only use the word “consultant” because it’s easier to explain, I’m mostly a contractor…)
* Full-time paid media / SEO person: I’ve been there too – unless you have two separate people on the job, it’s not going to be very productive.
* Hybrid approach: This is probably what worked best when I was the full-time paid media / SEO person in-house. I got to hire some contractors who’d help me with the vision I wanted to deliver, and honestly, that was really chill and I got to work on some more interesting stuff within the company instead of doing the grunt work, but that comes at a cost (that the company was happy to pay so it’s fine). It’s efficient but it’s someone on the payroll + contractors, so that costs a lot of money.

> And if I’m honest, outside of initial setup and strategy, I haven’t seen a TON of ingenuity over the last year+. Which maybe is normal? I realize good campaigns can become optimization and maintenance. Maybe that’s all I actually need?

Yeah, and I think it gives you good ground for negotiation. Something along the lines: “The account is mature, I accept that you do less, but I still want you onboard in case things go ape.”

Challenge them occasionally, but there’s only that much that can be done, especially if they don’t have power over messaging/content/business in general.

In any case, the lack of “ingenuity” is definitely not something unusual, but imho it’s grounds for negotiation, especially if you feel you’re not getting value from that.

> What I do know is I need somebody that digs in and actually thinks. Somebody that identifies opportunities, challenges assumptions, tests things, and owns outcomes.

The agency can do that and should do that if the budget allows.

> For those of you that have made this jump, would you hire in-house? Start with a contractor? Keep strategy outside and execution inside?

> And honestly… where are you finding these people?

Plenty of them in the sea that can do it.

Hires and agencies carry the same kind of risks: there are good ones, but there’s also no guarantee that they’ll do good either, so if you have something that works now… don’t fix what’s not broken is what I want to tell your bosses.

I honestly don’t understand leadership. It’s great to hire in-house, but if it’s a hire “for the sake of saving money”, it’s not going to happen.

It’s such a short-sighted mindset, imho, but better keep it quiet because the boss knows it all.

Good luck with that though, I hated to be in your position lol.

[leapinglemurmedia]

Have you thought about talking to your current agency and seeing if there is room for a flat rate or negotiate. As an agency ourselves, we’d rather try and find a solution to keep you as a client, than lose you due to fee concerns.

With hiring an employee you have to think about benefits. But contractors/freelancers aren’t bad ideas, we have just found, through our own hiring efforts, a lot can talk the talk but many struggle to walk the walk.

We have used upwork, freelancer and LinkedIn for hiring.

LinkedIn is fantastic for W2 employees and is the only site we use for that.
Upwork has brought the highest quality contractors but we haven’t done that in a few years. We prefer to hire W2 now.

[s_hecking]

I’ve been there on both sides. Agency builds a client up from $6,000 to $160,000 in monthly spend with consistent growth and good ROI. Then company decides to hire in-house to save a few bucks. Maybe it works and maybe it doesn’t. Since that’s a risk they’re willing to take, here’s a few options:

1 – Hire a contractor/consulatant with experience to help manage the account and perhaps SEO help. Make sure things don’t fall apart or CPCs get outrageously high. You may not save a ton on fees here but the ship will stay afloat.

2 – Hire someone with a few years of experience. Hope for the best. Spend most of your time managing this person. Pay to train them only to watch them leave for a $5,000 raise in 10 months.

3 – Hire the consultant until you have someone in-house you feel confident turning over management. Ultimately you’re just paying consultant to train this person who may ultimately leave anyway. At least you’ll have a backup plan if that person doesn’t work out.

I can’t tell you how many people I’ve watched on board in-house jump to another job after 7-10 months for what seems like a small pay bump. Owning an agency you see it all the time as well. Good agencies have a transition plan and pool of talent to make sure clients don’t feel that pain as much. I think when you hire a good agency, it is more expensive. There are a lot of benefits to it which can help justify the premium.

[Entire-Initiative498]

Been thinking about this a ton lately as I recently stepped into a similar situation with my mom’s business. The agency was not doing anything wrong, but it had become more monthly maintenance than real driving of marketing ops and strategy.

And in coming in to initially help “middleman” the agency relationship – I quickly kind of saw that their work was not worth the $xxk a month they were charging with % of spend, never mind trying to upsell an audit just for us to talk conversion tracking in more depth.

I think a lot of companies hit this weird middle stage where they do not just need “someone to manage Google Ads,” but they also may not be ready for a full in-house team,

If I were in your shoes, I would look for someone who can explain how they would improve the system around the account, not just the account itself. Search is moving more in that direction anyway. Search terms, ad copy, landing pages, conversion paths, lead quality, CRM feedback, reporting, and even organic / AI visibility all start to connect. The best partner should be able to think across that full picture.

[Sensei_Ro]

If you decide to go the contractor/consultant route I would love to chat. I am looking to transition out of a full-time in-house role, back into consulting. You’ll basically get a full time senior level employee without having to provide benefits.

As for what I would recommend, I would start with a contractor/consultant. Full-time employees who have never worked independently need a lot of structure. Unless you want to create SOP’s for the next 3 months outlining how reporting works, how to submit PTO, and everything else that comes with fully onboarding a full time employee, I would not consider an in-house employee.

Shoot me a DM and we can chat more.

[miawallaceadjacent]

That last paragraph is the whole thing honestly. The execution side is almost secondary. What you actually need is a guiding strategy so whoever is poking holes and testing actually knows what they’re working towards and why. Strategy always comes from inside, it can be collaborative once established, but always stems from your goals.

I founded a consulting firm that specializes in answering this question and would love the chance to chat.

[Desertgirl624]

If your agency is doing a good job, then you would probably be good to just try to renegotiate your rate. Most do not have a standard pricing model and will adjust to keep your business. So my recommendation would be to negotiate your price to what makes sense and monitor performance. If they start slacking and performance drops after that, then bring it in house.

[QuantumWolf99]

I’d separate execution from ownership here. If spend is high enough that percentage fees feel stupid, the answer is usually not agency vs in-house… it’s who owns strategy, tracking, creative feedback, and revenue accountability.

For high-spend accounts I work on, the best setup is often hybrid –> internal person owns context, approvals, product, sales feedback, and reporting rhythm — outside specialist handles media buying, testing structure, channel expansion, and ugly account decisions.

A full-time hire only makes sense if they can actually think across Google, Meta, YouTube, tracking, landing pages, attribution, margin, and pipeline. Most in-house hires become dashboard babysitters if leadership expects one person to replace a serious media function.

Also, AI changes the job but doesn’t remove the job. It can summarize data, flag anomalies, analyze search terms, speed up reporting, and find patterns. It still doesn’t know your board pressure, CAC ceiling, gross margin, close rate, or which leads sales secretly hates.

For larger budgets, I’d rather pay for senior judgment than cheaper hands.

[AdditionalAd7018]

I am literally in the process of organizing an agency to in house transition for my marketing team! I will say that this has been a roughly 2 year process of building up our team and we have an organic team established and we are currently working on getting our paid ads team more established.

I recommend listing out everything you need to have them do and estimate the average amount of hours it’ll take to do said tasks (I would overestimate a bit). Then determine if it is more than a 40 hour position. If it is, are you willing to hire multiple people? Is it fiscally responsible at that point to let go of the agency?

That was the biggest defining factor for us. We knew that someone that could manage multiple channels wasn’t reasonable for the tasks we needed to have done for each channel we manage.

Once you do that that will give you a clearer breakdown!