In-house Vs Managed Performance Marketing Platform

10-Oct-2022
In-house Vs Managed Performance Marketing Platform

Performance Marketing Platforms are the key indicators that drive the results. These platforms monitor and analyze all of the data points associated with a campaign, including leads, clicks, conversions, bounce rates, etc. Based on this data, changes can be made to how an ad campaign is run if needed. Therefore, every marketer, big or small, needs to monitor the performance of their campaigns.

The most significant conflict lying in every marketer's mind is whether to build their own platform from scratch to fulfill the requirements or take the services of a third-party who has a well-developed, user-friendly platform. We are here to put an end to this conflict. This informative blog will introduce you to the advantages and disadvantages, important considerations, and key differences between in-house and managed performance marketing platforms. One last piece of advice from Offer18 will be given at the conclusion. So, make sure to read it all to gain the most information possible.


In-house Performance Marketing Platform

On-premise or in-house software means creating your platform from scratch as per the business requirements. It will provide you with customization options according to your business, but it is not as simple as it seems. It is a road of uncertain destination. Establishing your platform means investing huge amounts in its setup along with other investments such as time, effort, technology, infrastructure, manpower, etc.

To get more clarity on this, go through its advantages and disadvantages provided below.


Pros of In-house Software

If you have a lot of cash in your bank account and enough time and resources to make your software, then you can go with an in-house platform. The advantages it holds are:-

  • Total Control:-The main advantage that in-house platforms hold is that you will have full control over all the activities. When you get a third-party performance marketing platform, you are introduced to wider sections because they consider all the aspects of every kind of business. In your operations, you might use very few of them, so while building your platform, you can only consider those sections that are helpful to your business and skip the rest.

  • Customization:- You can customize your platform according to your preferences if you have tons of money to invest. You can create a platform to ease your work by customizing it according to your business needs, but it needs technical expertise, time, and obviously, money.


Cons of In-house Software

In-house software is a costly affair, plus it is an unpredictable road map. There are many disadvantages to using in-house software as compared to managed performance marketing software.

  • Huge Setup Cost:-What if, say, a performance marketing platform’s subscription fee for 25 years is less than the one-time setup cost of building your platform? You won’t believe it, right? But we have examples to prove it!

    Well-built and user-friendly performance marketing platforms like Offer18 have a subscription plan that starts at $49 per month, which means you have to spend less than $15K per month for the next 25 years. But if you are building your platform, then it might cost you millions of dollars.

  • Time-Consuming Process:- Time is money nowadays, and building the whole platform from the beginning is undoubtedly a lengthy and time-consuming process. You have to spend extra hours planning things and implementing them properly later on. So think wisely and analyze precisely before taking any decision.

  • Requirement of Skilled Manpower:- There is no doubt that you have to hire a fairly large number of skilled manpower to create a fine platform for you. When you build your platform, you have to do a whole lot of work. From recruiting a person, training them, and creating a wholesome work environment, to analyzing their performance, appraising them, and if they leave, replacing them.

  • Maintenance Responsibility:- Building a platform is one thing while maintaining it is another. Many people succeed in building the platform with the huge cash their bank accounts offer, but are not able to maintain it because it requires persistent effort. You have to work on it by sparing time from your other business activities, which is a lot of responsibility.

  • Minimum Technical Support:- Technical expertise is another challenge you face while following the wrong roadmap of creating an in-house platform and skipping the smooth road of taking third-party services. Developing your platform will not offer you the advantage of technical support, but buying services from a managed platform definitely will.

  • Unpredictable Expenditures:- Creating your platform is not as easy as communicating with a salesperson of the service provider, buying a platform and starting working on it the same day. It is a very costly affair. As you start doing it, you will get to know that there are huge, unpredictable expenditures that you have never thought of in the very first place.


Managed Performance Marketing Platform

Managed performance marketing platforms assist companies and marketers to grow their businesses. These platforms offer various tools and features to analyze the performance of the campaigns through various useful insights; help in managing campaigns with automatic functionality, and assist marketers in taking futuristic actions wisely.

Below, we've listed some pros and cons of performance marketing platforms so you can learn more about them.


Pros of Managed Performance Marketing Platform

Third-party performance marketing platforms are evergreen and ever-growing. They will offer you a wide variety of tools and features to scale up your business. We have discussed a few of the advantages below:-

  • Scalability:-These platforms offer the benefit of scalability, which is definitely lacking in in-house platforms. You can take it as a customization facility offered by third-party platforms where you can choose the plans based on the required features. Still confused? Understand the example stated below -

    You started a new affiliate marketing venture and you feel the need to analyze the performance of your campaigns to grow your business. When you contact the service provider, you get to know the pricing structure and features that each plan offers. Since you just started working on it, you can opt for an initial and cost-effective plan. But after a year or two, when your business starts growing, you can go for another plan that offers enormous features.

  • Cost Effective:- Performance marketing software is quite pocket-friendly. The only cost you have to bear is the subscription cost of such platforms, which also depends on your usability. If the conversion requirement in your business is less than 10k, then platforms like Offer18 charge only $49, which is less than the cost of buying a one-tier cake, and if usage is equivalent to 40K conversions, then you can buy it at the cost of a two-tier cake. You can also buy enterprise subscriptions for the cost of a wedding cake. So choose your cake and subscription wisely.

  • Quality Support:- The commendable auxiliary service that you get from the managed performance marketing platforms is quality technical support. A good platform will offer you technical support, with whom you can contact each time you face any issue or need help in using platform services. This point, in particular, lacks the alternative option of creating your platform.

  • Minimal Risk:- The risk you take from buying services outside of your venture is minimal, or should say nil. Instead of risking your business, it offers you security. There are many fraud preventions and security measurement features that performance marketing platforms like Offer18 provide to their valuable users.

  • No Installation and Maintenance Cost:- Since you are not building a platform on your own, you don’t need to bear the high installation cost and fluctuating maintenance cost later on. You are all good to go to work after paying a few dollars as subscription fees. So, getting quality services at the lowest cost is the only wise option that you should definitely consider.

  • Easy to Migrate:- If you are taking services from one platform and feel like you are lacking in something or the features provided by your existing service provider are no longer serving you, then you can take the best possible decision for your business and migrate to another platform that offers you a wider range of incredible services at a low cost. But for an in-house platform, this is technically not possible. You can not create another platform in a day since you are not satisfied with its services.

  • Less Manpower and Technical Expertise Required:- While using the services of a third party, you don’t need to hire a large number of employees. You can work quite well with even fewer people. Also, technical support is already offered by such platforms, so you don’t require that too.

  • Cost Predictability:- One of the underrated advantages of taking services from outside is that you can easily predict the cost. Since you have to pay for fixed usage in the form of subscription fees, you can plan your expenditure accordingly. It also helps you with analyzing your future costs and assists you in making wiser decisions.


Cons of Managed Performance Marketing Software

However, there is no doubt that performance marketing software is incredible and offers you a wider area to grow your business. There are slight disadvantages to its holding that can be ignored if you are getting maximum benefits from it. They are as follows:-

  • Need to Adapt to Third-Party Policies:-Third-party platforms have defined terms and conditions along with set policies that need to be followed. They curate this according to their objectives and belief system. So to work with them, you need to adapt to those policies.

  • Fixed Recurring Expenses:- This can be taken as an advantage or disadvantage, depending on how you perceive it. If you use the services of a third-party platform, then you have to pay subscription fees either monthly or annually depending on your selected plan. This fixed, recurring expenditure is still far better than the fixed setup cost of building one's own platform and incurring the variable cost of maintaining it.


Factors to Consider before Making a Massive Decision

There is no doubt that making the biggest decision for your business is not easy. There are many components which are equally important to be considered before making the final choice. So, the key factors out of the pool are discussed below:-

  1. Easy & Fast Deployment:-Deployment here states how easily and effectively you can start its operations once you make up your mind on either building software or buying it. Building an in-house platform takes time, which is usually unpredictable. It takes months or even years to convert a plan into action. So you have to wait for a year to start using it. Considering the deployment factor, in-house platforms should be the last option. If you are still planning to take it, then you will have to contemplate the opportunity cost of not using performance marketing platforms in your overall cost.

    Whereas in managed performance marketing platforms, all you have to do is communicate with the sales executive, convey your requirements and budget, pay for the plan you opt for, and that’s it ! They will provide you with software access there and then you are good to go.

  2. Latest Technology upgradation:- The dynamic nature of technology changes constantly, and the one who adapts to changing technology achieves a competitive advantage. So this is also the supreme factor of comparison.

    When you build your platform, it's not easy to upgrade it consistently due to several factors, but this issue doesn’t exist if you use the services of managed performance marketing platforms because they remain up to date with the latest technologies. They do these upgrades on time without charging any additional cost to their clients.

  3. Up-to-date Partner Integration:- SaaS platforms will provide you with a smooth integration facility without any hustle. They are already integrated with many partners and software via API. You can request your platform if you can’t find the partner you want to integrate within their provided list. They take care of the client's requirements and perform actions accordingly. In self-built platforms, you have to face all the headaches of integrations. From communication to collaboration and fulfilling compliance to payments, it's all in your basket.

  4. Technical Support:- It is another factor which can’t be ignored if you want to operate your business smoothly. The technical support provided by such managed performance marketing platforms is incomparable. They are experts in their field who are always ready to help in the event of need. Nowadays, multichannel support is provided by leading performance marketing platforms such as Offer18, where you can ping them at any time, sitting anywhere, and you will get a quick response in seconds. So this is the greater advantage that such platforms provide, and this is also the disadvantage in the case of building your own platform. You have to find solutions on your own. No one is there to assist you better.

  5. Quality:- It is also a major aspect to be focused on. Managed Performance Marketing Platforms are developed and maintained by industry professionals who are experts in their field. They also perform timely updates when technology and trends in the industry change. Whereas in-house platforms lag in the race to quality because of a lack of skilled manpower and resources.

  6. Risk:- Risk is inseparable from the business. There is no business without risk. It always exists, but the proportion of risk and its manageable tendency has the potential to change the game. Confused? Well, we are here to resolve that.

    Since you know you have to face risk in your business, you can analyze the amount and nature of the risk along with its manageable property. In the context of in-house platforms, the risk is huge and managing it is not everyone’s cup of tea, but in performance marketing platforms, the risk is minimal, and if you feel like one platform is not serving you best, then you can switch to another.

  7. Maintenance:-Maintenance is also a factor that highly affects the affiliate marketer's decision. If you use the services of 3rd party performance marketing platforms, then you will not have to bear any maintenance costs. They manage their software quite well and do timely upgrades to their system based on client's requirements, industry trends, and innovations. On the other hand, if you build your own platform, you have to consider the maintenance of your installed software. Maintenance includes removing bugs, fulfilling client's requirements and solving their issues, maintaining the standard of the product, measures to protect against malicious activities, and keeping up with industry trends and innovations, and this list is uncountable.

  8. International Data Privacy Compliance:- Data protection and security are the major topics of discussion these days. Therefore, almost all platforms are taking vital steps to enhance security and provide quality services to their valuable clients. Using the services of such platforms is more secure because they provide impressive fraud detection and prevention features and maintain the international data privacy compliance of GDPR and CPRA. Moreover, they timely guide their users to take preventive measures to avoid fraudulent activities as compared to in-house platforms where chances of fraud are higher due to fewer security measures.


Conclusion

The decision between buying performance marketing software from already developed platforms or developing your own in-house software is not an easy one. You have to consider the pros and cons of both options along with other factors and the consequences of making such a decision. We hope that the above-stated discussion has cleared your doubts and provided you with the clarity to take the decision that will be suitable for your business.

A final piece of advice from Offer18

In the end, it is up to you to consider all the viewpoints and make decisions that will prove to be prosperous for your business, but here is a final piece of advice from Offer18.

  • A/B testingis crucial when it comes to choosing a better alternative from the two available options. You can consider the pros and cons of both the alternatives that we have mentioned above and enhance the accuracy of your study.

  • The opportunity cost is also an important aspect that most people usually ignore while analyzing. It states the loss of opportunity for the next best alternative while you select the first option. So if you consider the option of building your own platform (which we suggest you shouldn't), what opportunity cost do you have to bear? since building a platform is a time-consuming process. It can usually take a month or even a year to build, which means you have to wait for its development to start working on it, and obviously, the start-up cost is skyrocketing.

    If you had taken the services of performance marketing software providers, you would have earned access to the software on the same day after payment and started working on it. You could have made more connections, have a better client base, generated revenue for the whole year, and let's not forget the experience you will get from using the platform.

  • And last but not least, is the ease of doing business and putting more focus on the important areas that will help you stand out in this competitive era. So, instead of creating your platform, which will take up the majority of your time, consider creating your USP (Unique Selling Proposition) and enjoy the industry's largest customer base!



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