Agency vs. In-House vs. Fractional: How to Resource Your Marketing Team

Mandy switches seats for this one, joining Kayla Bryant on The Marketing Chatroom to break down when an agency beats an in-house hire, where contractors and fractional leaders fit, and how AI is repricing all three.

By Mandy Hornaday·Date·00 min·Guest
Mandy Hornaday
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The short answer

Resourcing a marketing team used to be a hiring question. AI has turned it into a design question, and the old defaults no longer hold. In this rerun of her guest conversation with Kayla Bryant on The Marketing Chatroom, Mandy draws on 12 years in-house, time on an agency bench, and a fractional CMO practice to map when an agency beats a hire, when contractors make sense, and the three factors that separate a real agency partner from a marketing checklist.

Key takeaways

    Two triggers justify an agency over a hire: large-scale projects like a rebrand, website build, or go-to-market tech-stack integration, and deep expertise you need less than full-time, like SEO or PR. Capability in-house is not the same as capacity. Big projects pull strong people away from their core responsibilities and drag down the results you would otherwise expect from them. Contractors beat an agency when you bring the network. Without one, a team of one to three inherits four separate hiring, onboarding, and replacement burdens instead of one partner. Screen agencies on three factors: specialization over do-everything claims, AI adoption that sharpens the work and brings costs down, and partnership flexibility instead of margin-protecting rigidity. AI is repricing all three models. Clients now self-serve competitive research and reporting with ChatGPT, and one CMO ran a full rebrand with a few contractors and mostly AI in under six weeks.
    In this recap

    This one is a seat swap. Mandy recorded this conversation as a guest on The Marketing Chatroom, hosted by Kayla Bryant, General Manager at Two Trees PPC, and the two shows released it as a dual episode. Kayla lives the agency side every day. Mandy has sat in-house, on an agency bench, and in the fractional seat. Between them, the full resourcing picture gets mapped: agency, in-house, contractors, and fractional, and how AI is rewriting the math on each. Big thanks to Kayla for a sharp, generous conversation. The recap below walks the framework step by step.

    When should you hire a marketing agency instead of making an in-house hire?

    Bring in an agency for large-scale projects and for deep expertise you need less than full-time, and hire in-house when the work is core and constant. Mandy's rule has two triggers. The first is the big project: a rebrand, a website build, a full go-to-market tech-stack integration, work that rewards people who have run the play many times before. The second is senior specialisms like SEO and PR, where a focused agency stays more current than one internal person could and where forty hours a week is more than the job needs.

    "If you don't need someone full-time, or if you need very deep expertise in an evolving space, or if a large project would either crush your team or benefit enormously from people who've done it before, those are the right moments to bring in outside help."

    What do large-scale projects cost your in-house team?

    More than the invoice shows, because big projects pull strong people off the work you hired them to do. Capability in-house is not the same as capacity, and this is the hidden cost Mandy sees leaders miss most often. In her words, large projects can be "a serious drain on your internal team," pulling people away from their core responsibilities and dragging down the results you would otherwise expect from them. The rebrand gets done, the pipeline numbers sag, and the two rarely get connected. Treating a major project as a resourcing decision in its own right, rather than an add-on to the existing team's plate, is the same discipline as placing deliberate strategic bets in the annual plan.

    When does the contractor route beat an agency for a small team?

    Contractors win when you already have the network, and an agency wins when you would be hiring strangers four times over. Mandy went the contractor route at her startup because she knew her favorite designer and her favorite social person by name, and she is clear that without that network she would have evaluated it very differently. A marketing director with one to three people, the profile Kayla says makes up much of her client base, inherits the interviewing, onboarding, and replacing for a designer, a social person, an email person, and a web person separately. Kayla positions her agency squarely against that burden: for a cost similar to one salary, a client gets design, paid social, search, video support, and SEO through one partner. That is her positioning rather than a market rate, and it frames the real trade well: one relationship to manage, or many.

    Why do small-budget agency engagements turn into a marketing checklist?

    Because the budget and the expectations were scoped separately, and activity fills the gap results were supposed to own. Mandy sees it most with smaller companies: a modest monthly spend paired with full-suite expectations across social, SEO, web, and email. Neither side set out to underdeliver, and she is careful to say it is not the agency's fault or the client's fault. It is a scoping failure.

    "In those situations I often find it turns into a marketing checklist, doing things to check them off rather than driving real results."

    Kayla's answer at Two Trees PPC is to fix the mismatch before the contract exists: sample keywords and sample audiences pulled before signing, an alignment session on goals, KPIs, and everything the client has tried before, and a strategy built from that history. She is candid that this is not the norm in the agency world, and it is exactly the scoping work that keeps a retainer from turning into a checklist.

    How should you evaluate an agency partner?

    Screen on three factors: specialization, AI adoption, and what the partnership will feel like day to day. On the first, Mandy is direct: she does not believe an agency can do everything amazingly, and the wins she has seen came from shops specialized by company size, by industry, or by one deep discipline.

    "The most success I've seen has been with agencies that are highly specialized, whether that's digital for small companies, a particular industry, or one deep area like SEO."

    The second factor is AI, covered in the next section. The third is partnership posture. Will they embed as part of your team, act as a strategic advisor, pick up the phone when you call? Or will the relationship run on two rounds of approval and hard deadlines? Those structures exist to protect agency margins, and Mandy acknowledges the reason while naming the cost: they can make the relationship harder than working with an in-house hire or a fractional leader.

    How is AI changing what agencies are worth?

    Clients can now self-serve much of what they used to pay agencies for, so the value has to move to what they cannot get themselves. Competitive research, data pulls, and reports that once justified a retainer now come out of a ChatGPT session. Mandy is living this from the inside: she builds marketing strategies for the agency whose bench she sits on, and she is reworking that product around what clients can now do on their own.

    "A lot of what people used to go to agencies for, they're learning to do themselves with AI. So the value proposition has to evolve."

    She wants the agencies she hires using AI to make themselves more efficient, less bloated, and less expensive, sharpening the work rather than just speeding it up. And the ceiling keeps moving: she points to a CMO who ran an entire rebrand with a few contractors and mostly AI in under six weeks. It is the same shift Heidi Darling maps in her conversation on staying valuable in the AI era: when clients can self-serve the output, the value moves up a level, and so should you.

    Where does fractional leadership fit in the resourcing mix?

    Fractional gives you senior strategy without the full-time seat, and it works best as the layer that decides how everything else gets resourced. Mandy speaks from all three chairs here. She spent the first 12 years of her career in-house, joined an agency bench as a consultant when she left, and now runs a fractional CMO practice across several accounts at once. The underpriced benefit of that model, in her words: "You're inadvertently getting the benefit of all of that cross-client learning." A fractional leader arrives having watched how many different companies operate, which is the same orchestration muscle Matt Heinz argues the CMO role is growing into: less about headcount owned, more about resources conducted.

    Resourcing is one subsystem of the larger build, the operating system a marketing leader runs the whole function on, and the agency, contractor, and fractional calls get easier once that system is in place. Mandy closes the conversation where she started it: AI has added a whole new dimension, and there is still real value in agencies, contractors, and in-house teams. The interesting work is deciding which one, for which job, right now.

    Chapters & timestamps
    00:00 Why This Rerun, and Mandy's Path Across All Three Models 05:50 When to Hire an Agency vs. In-House 11:00 Agency vs. the Contractor Route for Small Teams 15:30 The Budget-Expectations Mismatch and the Checklist Trap 20:30 Three Factors for Evaluating an Agency Partner 25:00 How AI Shifts What Agencies Must Deliver

    Common questions

    Who should own marketing strategy when you work with an agency?

    A senior internal or fractional leader should own the strategy and write the briefs, and the agency should execute and advise against them. Engagements tend to drift when ownership is unclear, because the agency ends up guessing at priorities the business has not defined. Keep strategy in the building, even when the hands are outside it.

    What should you ask an agency about AI before signing?

    Ask how AI makes their team more efficient and less bloated, whether those savings reach your fee, and how it sharpens the deliverables rather than just speeding them up. An agency using AI well should be able to show you where the work got better and where the cost came down.

    How do agencies, contractors, and fractional leaders each change your workload?

    An agency gives you many disciplines through one partner and one relationship to manage. Contractors give you handpicked specialists, and you carry the hiring, onboarding, and coordination yourself. A fractional leader gives you senior strategy without a full-time seat, and works best paired with hands to execute.

    Is an agency cheaper than an in-house hire?

    It depends on scope match. Kayla Bryant positions her agency as one partner delivering design, paid media, SEO, and video support for a cost similar to one salary, which is compelling for a small team. The advantage erodes when a small budget carries full-suite expectations, because the engagement turns into activity instead of results.

    How often should you revisit your resourcing model?

    More often than feels comfortable. AI is repricing agencies, contractors, and in-house teams at the same time, so re-run the decision at each large project, budget cycle, or team change rather than treating the model you have as permanent.

    Guest
    About the guest

    Show full transcript

    Mandy Hornaday: Ever wondered when it's the right time to hire a marketing agency, or how agencies, in-house teams, and fractional roles actually fit together in 2025? In this special rerun episode, I'm switching seats and joining Kayla Bryant on The Marketing Chatroom to break it all down.

    Mandy Hornaday: Hey everyone, welcome back to Growth Activated. I'm your host, Mandy Hornaday, and today you're hearing a conversation where I was the guest. I recently joined Kayla Bryant, General Manager at Two Trees PPC and host of The Marketing Chatroom, for a candid discussion about how marketing leaders and business owners can think about resourcing in a fast-changing landscape.

    Mandy Hornaday: In this episode, we cover: when to consider bringing in an agency versus hiring in-house, and the types of projects where outside support can be a major advantage. The realities of agencies, contractors, and fractional roles, including benefits, trade-offs, and how they change the workload for small and mid-size marketing teams. How to avoid mismatched expectations with agencies, especially when budgets are tight and teams want "the full package." And how AI is reshaping resourcing decisions, and why marketers and agencies alike need to evolve their value and output.

    Mandy Hornaday: If you're evaluating how to scale your marketing team or simply want a clearer lens on agencies versus in-house versus fractional, this conversation will give you a grounded, real-world perspective. Let's dive in.

    Kayla Bryant: Hi, Mandy.

    Mandy Hornaday: Hey, Kayla, great to talk to you today.

    Kayla Bryant: You too. I'm super excited for this conversation. Thanks for taking the time to chat. So we're doing a dual episode on Growth Activated and The Marketing Chatroom today. I'm really excited to dive in because you have such a vast experience and background in marketing, so many different areas, facets, and titles you've held. I'd love to jump in and hear your insight on: how do you know it's the right time to hire a marketing agency? What are some of the differences between working at an agency, working in-house, and working fractional like you're doing now? Wherever you want to start, I'm ready to jump in.

    Mandy Hornaday: It's a fun conversation to have, and one that a couple of years ago, had you asked, I would not have thought I'd be any kind of expert on. I spent probably the first 12 years of my career completely in-house and loved that model. I didn't really know anything different. I certainly used agencies and contractors throughout that time, with positive and negative experiences depending on who we brought on board. But I predominantly had a large in-house team that I managed. And then when I left in-house a couple of years ago, one of my first stops was to an agency owner I knew from the industry, someone I really respected, and I joined her bench as a consultant. That was probably my first real foray into understanding the agency side without having to run an agency myself. I actually thought originally that I might want to, so I wanted to get some exposure. Spoiler alert: I do not want to run my own agency. I respect everyone who does. It's a great model, but it's a tough business. And today I'm still on the agency bench, which is a great way to get in the door with new clients. I'm also a fractional CMO, working directly with clients in several accounts simultaneously. So I have broad exposure and I'm really excited to talk through this with you.

    Kayla Bryant: That's awesome. My experience is only on the agency side. I'm now General Manager at an agency, so it's going to be really interesting to hear your perspective. For in-house marketers, what are some of the signals that it might be time to either make another in-house hire or bring in an agency? How do you navigate that decision?

    Mandy Hornaday: Great question, and one that I think is changing every day because of AI. Resourcing has been turned upside down. But based on what I've seen work in-house and on the agency side, there are a few situations where I'd recommend bringing in an agency over an internal hire.

    Mandy Hornaday: First: large-scale projects or campaigns. A rebrand, a website build, a tech implementation, integrating your full go-to-market tech stack, anything that requires a lot of strategy, systems, frameworks, and deep expertise. You'll get enormous benefit from people who've done it many times and can guide you through the process. And even if you have the capability in-house, those large projects can be a serious drain on your internal team, pulling people away from their core responsibilities, burdening the company, and dragging down the results you'd otherwise expect from them.

    Mandy Hornaday: Second: when you need deep expertise in a function, but not full-time. SEO is a great example. PR is another. Those are fairly senior roles where, from a PR perspective, you want someone with a deep network you can tap into immediately. From an SEO perspective, it's constantly evolving, and a specialized agency is likely staying far more current than an internal person could. That's really hard to maintain on your own. So: if you don't need someone full-time, or if you need very deep expertise in an evolving space, or if a large project would either crush your team or benefit enormously from people who've done it before, those are the right moments to bring in outside help.

    Kayla Bryant: That totally makes sense from the agency side too. We're a boutique but pretty comprehensive digital agency. Most of our clients are either a marketing director with one to three people on their team, or a business owner who simply doesn't have a marketing team, so we can really operate as the team for them. It's such a broad space in terms of what a marketing team can look like.

    Mandy Hornaday: And you touched on something else that's a huge value for small companies, getting the benefit of many different types of expertise through one partner. That can be really beneficial compared to the contractor route, where as a business owner or a marketing director you'd need to go find a contract designer, a contract social person, a contract email person, a contract web person separately. Going through an agency when you're small reduces a lot of the hiring burden, the interviewing, the onboarding, and then replacing people when they leave. Really valuable.

    Kayla Bryant: Yeah, that's actually how we position ourselves. For a very similar cost as one salary, you get a graphic designer, someone running paid social, someone running search ads, consultants, video support, SEO. More comprehensive than one hire, and without the overhead of managing all those separate contractors.

    Mandy Hornaday: The reason I went the contractor route at my startup instead of agency was because I had the network. I knew my favorite designer, my favorite social person. But had I not had that network, or had I been a business owner, I would have evaluated it very differently rather than piecing together contractors on my own.

    Kayla Bryant: Right. And how much time and energy do you have to dedicate to making those pieces work together? If you're one person with a really clear framework of what you need, a contractor or in-house hire might work. But a lot of the people we work with are managing trade shows and everything else. They need us to handle the digital and make it run on its own.

    Mandy Hornaday: I'd be curious. One of the things I see go wrong on the agency model is mismatched expectations relative to spend. Specifically for smaller companies: the budget is pretty small but they want the world. Social and SEO and web and email and the full end-to-end service, but only a small monthly spend. In those situations I often find it turns into a marketing checklist, doing things to check them off rather than driving real results. That's not necessarily the agency's fault or the client's fault. It's just a mismatch of budget to expectations. Do you run into that?

    Kayla Bryant: Absolutely. It's pretty common that expectations and outcomes aren't aligned. A lot of agencies deliver vanity metrics, here's how many clicks you got, isn't that amazing, and that's not what keeps a client happy or growing. What we do to bridge that gap is a really intensive onboarding before they even sign. We pull sample keywords, pull sample audiences, present it to the client so they have a real sense of what to expect in that landscape. Then we hold an alignment session: we dig into the history of the business, the goals, the KPIs, all historical data, what they've tried before and why. From that, we build a new proposal and strategy. Here's what we're going to do and why, here's the testing plan, and here's when we'll come back for another round of decision-making. That's not the norm in the agency world. The norm is more like: here are the campaigns, here are the metrics, we move on.

    Mandy Hornaday: That's awesome. And yeah, that's a huge learning curve, how to balance multiple accounts and multiple clients. When I first started, I'd work six or seven hour days and feel like I'd worked twelve. Decision fatigue is real. But on the flip side, clients benefit from working with people who are exposed to how many different companies operate. You're inadvertently getting the benefit of all of that cross-client learning. Pros and cons for sure.

    Kayla Bryant: Absolutely. And on that note, if you're shopping around for an agency or looking to make a contract hire, what are the most important decision-making factors?

    Mandy Hornaday: Three things for me. First: specialization. Marketing is so wide and vast, and there are a lot of agencies that claim to do everything. I just don't believe agencies can do everything amazingly. The most success I've seen has been with agencies that are highly specialized, whether that's digital for small companies, a particular industry, or one deep area like SEO. One of my favorite agencies I've ever worked with was an SEO-only shop. Brilliant. The owner is still a close friend today.

    Mandy Hornaday: Second: how are they keeping up with AI? Agencies are at a unique and honestly vulnerable place right now. A lot of what people used to go to agencies for, they're learning to do themselves with AI. So the value proposition has to evolve. I want to know the agency I'm selecting is using AI to make themselves more efficient, less bloated, and potentially bringing costs down, because agencies are expensive. That cost is often justified, but compared to fractional or in-house options, agencies can be more costly. So I'd want to see AI being used to sharpen the work, not just speed it up.

    Mandy Hornaday: Third: what kind of partner are they going to be? Are they going to embed themselves as part of my team? Be a strategic advisor? Someone I can actually call? Or are they going to be rigid, two rounds of approval, hard deadlines, that's it? Those structures exist for a reason, and they protect the agency's margins. But they can also make the relationship harder, especially compared to the flexibility of an in-house person or a fractional. I'd want to know that real partnership was on the table, and that the mutual respect was there on both sides.

    Kayla Bryant: That totally makes sense, especially the AI conversation. It's November 2025, just for context for anyone watching later. I agree that agencies broadly are at risk. People with time and the know-how can now use AI to replace a lot of what we do. We use AI heavily and lean into it, but we've also built in safeguards to make sure we're not over-relying on it or automating everything to the point where the work gets sloppy. The people receiving this content are still humans. Everything still has to resonate.

    Mandy Hornaday: Absolutely. It's about leveling up. I'm thinking about this a lot right now because I do marketing strategies for the agency, and I'm actively reworking what that product looks like. Clients can now find so much more themselves through ChatGPT: competitive research, data, reports, things that used to be incredibly valuable to deliver back to a client. That doesn't mean we're not valuable anymore. It means the value has to shift. The output has to evolve based on what clients can now get themselves. That's something I'm genuinely challenging myself on right now.

    Kayla Bryant: Yeah, working with it rather than against it. We're actually going through a full rebrand right now as an agency, a lot of that driven by how much has evolved in just the last year and a half. It's an interesting space to be in.

    Mandy Hornaday: I actually have an episode coming out next week on Growth Activated. I just interviewed a CMO who did an entire rebrand with a few contractors and mostly AI in less than six weeks. I'll have to send you the link when it's live. Lots of learnings there for your own rebrand.

    Kayla Bryant: I would love to see that. I'll have to send the listeners over to that episode too.

    Kayla Bryant: Awesome. Well, this was a great conversation. Any closing thoughts before we sign off?

    Mandy Hornaday: I really enjoyed this. Resourcing right now is such an interesting conversation. There are so many ways to approach it, and AI has added a whole new dimension. But there's still a lot of value in agencies, contractors, and in-house teams. It's a fun one to keep monitoring. Thank you so much for having me today.

    Kayla Bryant: Thank you. It was a great chat. I really appreciate you coming on.

    Mandy Hornaday: Absolutely. Talk soon.

    GA
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