According to Ventoro Consulting, 19 per cent of all companies have an offshore strategy. However, when it comes to the US’s top 1,000 firms, the number of companies using an offshore strategy jumps to 95 per cent. Even a few Government departments are quietly outsourcing back-office functions to Asia. If that’s not a guide to the future, I don’t know what is.
What many people are totally unaware of, is what’s happening offshore with direct marketing services. More than a few marketing communications agencies now operate a back-end digital function in South Africa, using that country’s local talent to code and develop online campaigns designed and developed in the UK. Likewise, a few larger agencies are outsourcing artwork and production facilities – indeed, one leading agency has 100 artwork staff based in Mumbai, India. Not to be outdone, data bureau work is also moving overseas and the vast majority of our company’s data bureau services, whilst fronted in the UK, are being undertaken in Manila, Philippines.
For the direct industry, the future is clear: marketing strategies will be planned and created in the UK yet increasingly the implementation of them will be outsourced abroad, where costs are anywhere between 50-70 per cent cheaper. Not only does this deliver cost savings to clients and boost agencies’ profit margins, it also allows marketing budgets to stretch further.
Other offshore advantages include 24/7 operational service, huge back-up resources and what is referred to as ‘follow-the-sun’ development - the eight hour average time difference between Asia and the UK allowing marketers to send work abroad in the evening and receive it back in time for the next morning. Moreover, in the offshore world, weekends don’t exist allowing campaign implementation to be speeded up.
What makes this all possible? Technological communications advances allow remote, secure electronic access to internal data and processes. This is the same technology that routinely allows servers to be remotely serviced and managed by IT support. It means that you don’t have to send information, artwork or data anywhere – everything is accessed electronically.
Call centre outsourcing is now well known but logic dictates that other services, particularly data processing, are far better suited for offshore suppliers to undertake. The advantages are obvious: up to a 50 to 70 per cent reduction in direct marketing costs along with increased flexibility.
Author: Jed Mooney, Managing Director
Source: Precision Marketing Magazine
Publication Date: 26 September 2006