Digital agencies: London vs Manchester, why you should look outside the capital

Posted on Sep 12, 2017 | General
Digital agencies: London vs Manchester, why you should look outside the capital
A long standing debate in digital services, the question of whether or not to use a London based agency is one that we come across often. Here we take a look at why shopping outside of London is fast becoming the preference when looking for digital marketing agencies.

 

Whilst there are some benefits to having your agency based around the corner if you’re based in the capital, the nature of SEO and other digital services means that this is not only unnecessary, but it can also prove to be a costly preference. This, combined with the fact that many agencies outside of London are coming to the forefront of the industry means that many companies are finding that they can save significant portions of their digital marketing budget by using agencies that aren’t based in the capital, without having to compromise on quality of service or results. We’ve been taking a look into the reasons why many London based companies are choosing to shop elsewhere for their digital services.

 

The London quality fallacy

Traditionally, companies outsourcing their marketing to an agency would have had a strong preference for those who were close by, or at least in the same city. This was for obvious reasons that centred around convenience for meetings and accountability, as well as the fact that you’re often able to easily ask around about the agency’s reputation if you’re within the same geographical area. In the London sphere, however, there has also been another reason for selecting city-based agencies for quite some time – the notion that London based agencies are considered superior to those elsewhere in the country. When we take a look at some measurable statistics on this, however, it soon becomes apparent that this notion is somewhat misleading. Whilst there are undoubtedly some exceptionally talented digital agencies in London, there are also many elsewhere in the country. Take the UK Search Awards , for example; awards specifically geared towards recognising the best and the brightest in the search marketing industry. Of all of the 2016 winners, over 47% of them were based outside of London. When we also take into account the number of agencies in London vs those not based in the capital, it’s safe to conclude that there’s a wealth of incredible agencies elsewhere that deliver proven results for clients.

 

The fee discrepancy

In 2017, general price hikes in London have been well documented, including a 1.9% increase for rail fares, as high as a 10% increase in some housing rental prices, and even a 2.2% ramp up in water bills. With all these increases going on, wages are also on the up to accommodate the discrepancies for those living in London vs those living outside the city. In 2017, the average wage in London for digital employees is reported as being over 36% higher than their non-city counterparts in order to cover the huge discrepancies in living costs within the London ecosystem. London’s inflated cost of, well, everything to be frank, also means that an agency pays out more on office space, utilities, service charges and almost every other type of cost associated with running a business, as well as wages. For those companies considering outsourcing their digital marketing to an agency inside the city, this means that the difference in their agency overheads are passed on to you, the client. In line with the cost of everything else, agency fees within London are also growing at a faster rate than elsewhere; a study of independent agencies published by The Wow Company found that 51% of London agencies said they were set to increase their prices in 2016, and industry rate card surveys consistently show that London agency fees are around 42% higher than the average agency outside of London for exactly the same services.

 

Accountability and service

Again, years ago it would have made absolute sense for London based companies to engage London based marketing agencies as a matter of course. Being geographically close meant that they were able to come in for meetings at the drop of a hat, plan campaigns from their clients’ offices wherever necessary, and occasionally take them for lunch as a nice little cherry on top of the very convenient cake. Whilst being close for traditional, non-digital marketing services may arguably still make an agency more accountable, digital marketing by it’s very nature is solely online. Meetings are, of course, necessary as part of a service provision, but there isn’t the same need to work from a client’s premises. In addition to this, it’s not always easier nowadays for a London agency to get to another London location than it is for an agency to get to London from somewhere else in the country. For example, according to statistics released by The Telegraph , the longest journey on the tube without changing line is West Ruislip to Epping, which takes 1 hour and 23 minutes. Bearing in mind that the vast majority of journeys around London do require at least one change of tube, this means that it can take a significant amount of time to make a journey around London depending on where you are based and where you’re going, so the average tube journey is currently 47 minutes in duration. A train from Manchester to London takes 2 hours, and with the proposed introduction of the HS2 train, this is set to be cut down to around 1 hour 8 minutes within the next few years, which will make the journey from North to South a mere 21 minutes longer than the average journey across London.

 

More hands on deck

Due to the higher London wages mentioned above, as well as other costs, the pressure to have more clients per employee seems like an obvious one. When considering the profitability of any business, it makes sense to set a benchmark in terms of the ratio of billable hours to wage spend for each employee, or at least your workforce as a whole. As a client, when you have a set budget to work with this can make it difficult to truly get your money’s worth in terms of service. Naturally, the higher the cost of running the business, the more imbalanced the ratio of service to cost so London agencies are faced with two choices – either increase fees, as has already been mentioned, or decrease the time spent on a client to accommodate for more clients per employee. This is a dilemma that’s not as widespread with non-London based agencies due to the much lower cost of labour, making it easier to assign more staff time to accounts. This can often mean that rather than being a small fish in a big pond, you’re serviced as a big fish in a small one, with more dedicated time and attention from key members of staff.

 

Ok, so why Manchester?

Whilst there is a plethora of great agencies to choose from around the country, Manchester has become a hub of digital activity in recent years. Various initiatives in the area have resulted in record numbers of digital agencies in search marketing , video production, website development and many other digital disciplines. As the epicentre of the so-called ‘Northern Powerhouse’, Manchester offers perhaps the largest choice of agencies outside of London. Taking into account the points noted above, the northern capital also fits the bill in terms of commutability to London for meetings due to direct rail links from Piccadilly to Euston, making it easy for Manchester based agencies to service clients in the London area. Price-wise, the UK’s second city gives much more bang for your budget, even in comparison to other agencies that are in the South but outside of London, such as other prominent digital hubs like Brighton and Surrey. In short, Manchester is currently the place in the UK where you're most likely to get a great service, tangible results AND save a lot of money on fees.

 

In conclusion, if you’re a London based company looking to outsource digital services, considering agencies outside of the area could lead to monumental savings with the same, if not better results and no compromise in service levels.

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