Full-Time vs Fractional Marketing: A UK Cost Analysis

When it comes to running a successful marketing department, the strategy is important - but so is choosing the right team structure. If you’re managing a UK business with a turnover of £5 million+, the decision to hire a full-time in-house team versus a fractional marketing team can feel like trying to choose between two equally tempting options - each with its own set of hidden costs.

In this blog, we’ll break down the true cost of hiring full-time employees and compare it with the pay-as-you-go fractional model. Spoiler alert: fractional marketing might just save you more than you think!  

Full-Time Employees: It’s Not Just About the Salary

So, you’ve found your ideal marketing manager with a £40,000 salary – great! But before you celebrate, there’s a lot to consider. When you hire someone full-time, that 40k salary is just the tip of the iceberg. Some of the hidden costs that can turn a modest salary into a much heftier bill include:

National insurance:  

Employers pay 13.8% of an employee’s salary over £9,100. That’s an extra £5,520 on a £40k salary.

Pension contributions:

As part of auto-enrolment, you’re required to contribute at least 3% to the employee’s pension. On £40,000, that’s an additional £1,200.  

Holiday and sick pay:

Employees are entitled to 28 days of paid holiday per year (including bank holidays). So, you’re paying 10% of their salary for time they’re not even working!

Office overhead:

Every employee needs a desk, a laptop, and software. That’s an extra £4,800 per year in office space, equipment, and other overheads.

Training in recruitment:

Marketing is always evolving, so your team will need training. Plus, you can expect to pay around £8,300 just to bring someone on board.

When you add all of this up, the total cost of hiring a £40k marketing manager could easily push you over £60k in the first year. But don’t panic! Fractional marketing might just be the solution to your budget woes.  

Why Fractional Marketing Teams Offer a Flexible, Cost-Effective Option

The fractional marketing model allows you to access high-level marketing expertise without all the hidden fees that come with full-time employees. Here’s how it works:

Pay-as-you-go:

With fractional marketing, you only pay for the work you need, not the whole salary. Whether it’s a day-rate for a seasoned CMO or a monthly retainer for an agency, the price is often far more predictable and manageable than a full-time hire.

No employer overheads:

No national insurance, no pension contributions, no holiday pay, no office overheads. Fractional marketers handle their own taxes and benefits, leaving you with a nice, all-inclusive fee.

Scalable:

Fractional marketing helps you scale quickly if you need extra help for a big campaign or product launch. Fractional teams also offer the flexibility to match your marketing spend with your business cycles, which can be extremely beneficial during quieter times.  

How Much Can You Save?

Imagine you need a full marketing function for your £5-£10 million turnover business -let’s take a look at the costs of building an in-house team.  

• Marketing Manager: £65k salary
• Digital Marketing Executive: £35k salary
• Content/SEO Specialist: £30k salary
• Total salary: £130k per year

But when you add on National Insurance, pensions, office space, recruitment costs, and training, your real cost is closer to £181,000 in the first year. Ouch.

Now, let’s look at the costs of hiring a fractional team. You engage a fractional marketing agency for a comprehensive monthly package – let's say £10,000/month, which totals £120,000 a year. This covers a fractional CMO, content creation, PPC management, SEO, and more – without the additional costs and headaches.

In this scenario, the fractional team costs you £60k less than the in-house team. And that doesn’t even take into account the flexibility and amping up or down your marketing spend when needed.  

So, What’s the Verdict?  

The numbers speak for themselves. Full-time marketing teams come with a hefty price tag once you factor in all the hidden costs. On the other hand, fractional marketing teams offer a flexible, scalable, and cost-efficient solution that gives you access to top-tier expertise without the overhead.

For growing businesses, especially those with a £5 million+ turnover, fractional marketing is quickly becoming the smarter, more cost-effective choice. You get the expertise you need, when you need it, without worrying about national insurance contributions, pensions, or office space.  

Here at Creative Ideaz, we specialise in helping businesses scale their marketing efforts without breaking the bank. So, if you’re ready to save money, increase flexibility, and improve your marketing ROI, let’s talk! Let’s make your marketing smarter, not harder.