TLDR:In-house marketing teams offer the most control, but cost the most and take months to build. Agencies can execute fast on a defined scope, but rarely own the overall strategy and can create communication gaps because they sit outside the company. Fractional marketing departments sit in between: senior strategy with flexible execution, without benefits costs. The right fit depends on your stage and existing bandwidth. |
If your marketing runs through one person, whether that’s you, a generalist hire, or whoever in your company has time that week, you’re not alone. LocaliQ’s 2026 Small Business Marketing Trends Report surveyed more than 300 small business owners and found that 50% have no dedicated marketing employees at all. That gap widens for the smallest companies surveyed. Those with 10 or fewer employees are 45% more likely to have no one owning marketing on a full-time basis.
At the same time, 66% of small business owners reported that they expect economic uncertainty to make 2026 harder than 2025–a sharp increase from 48% in 2025. Understandably, the instinct for SMBs facing economic uncertainty is to pull inward, but they are doing so in an unexpected way. LocaliQ found that only 34% of SMBs currently work with external marketing partners, a decrease from 60% in 2025. While companies aren’t cutting marketing itself, they are cutting outside support that is designed to free up bandwidth for strategic activities, putting even more pressure on already-stretched internal teams.
The same pattern is consistent further up the org chart, according to the 2026 Spring report of The CMO Survey by Duke University’s Fuqua School of Business with Deloitte and the American Marketing Association. The report found that marketing leaders are absorbing more formal responsibility than in years past, including managing revenue growth, driving PR, and participating in company-level leadership conversations, all while facing sustained pressure to demonstrate marketing ROI. In response, 70.6% of marketing leaders report that they are shifting toward short-term impact over long-run gains. They are now spending about twice as much time managing day-to-day marketing activities as preparing for the future, a pattern that’s been consistent since 2019.
Whether you’re a founder wearing the marketing hat at a $6M company or you lead an overworked marketing team at a $40M company, the problem is the same. The less room to breathe means less room for planning ahead. Given the current status of marketing teams at small, medium, and large companies, now is a perfect time to look at how your own marketing function is built.
For some, maybe that means moving certain activities outside of the company. For others, it could mean engaging senior strategic support on a fractional basis long enough to build the roadmap, and in some cases, to help train the internal team that will eventually run it. Either way, one of the most useful questions marketers can ask themselves right now isn’t “should we spend more or less on marketing.” Rather, it’s “Who on this team is actually positioned to think ahead strategically, and who isn’t.”
The salary you see in a job posting is only part of what an in-house hire actually costs. A lean, functional team, including someone to own strategy, someone for content, and someone for paid or social advertising, typically runs $65,000-$95,000 per role in base salary alone. Per calculations from the U.S. Bureau of Labor Statistics data, benefits add about 39% on top of wages at professional services companies with fewer than 100 employees. For a three- to four-person marketing team, that puts all-in annual cost between $270,000-530,000 before you’ve paid for a single ad, software license, or piece of equipment.
Then there’s time. The average marketing role takes about 50 days to fill, so staffing a full team from scratch can take six to eight months, during which your pipeline still requires attention. Then consider onboarding. New hires also need three to six months to reach full productivity, which means the real payoff on that investment may not appear until year two, and that’s if that employee stays in the role.
So, when does it make sense to invest in an in-house team? When marketing needs to be deeply embedded in daily operations, when institutional knowledge matters more than breadth of expertise, or when the company is large enough to require a full marketing function. While it’s the most expensive option and requires the most amount of time to build, it’s also the option with the most direct day-to-day control.
Agency retainers for small and mid-market companies can run anywhere from $3,000 to $15,000 per month, depending on the scope. This is a fraction of the cost of hiring the same capabilities in-house. That’s the appeal for many companies–instant access to specialists in SEO, paid media, design, video, and content without carrying them on the books as full-time salaries.
The trade-off shows up in how the work gets delivered. Many agency engagements route communication through an account manager, with execution happening one or two layers removed from strategy. Scope is often built around channel-specific deliverables, such as a set number of blog posts or a paid media budget, rather than a single point of accountability for revenue outcomes. Additionally, some retainers also charge a percentage of ad spend on top of the management fee, which can make costs harder to predict.
So, when does it make sense to engage an agency? They’re a reasonable fit when you know exactly what needs executing. Agencies are a weaker fit when you need someone who develops and owns the whole strategy, not just a piece of it.
A fractional marketing department sits between the in-house marketing team and agency options. Instead of buying either a full internal payroll or a bundle of channel deliverables, you get senior strategic leadership. That is, someone who sits in your planning conversations and owns outcomes, paired with coordinated execution across tactics. It functions like an embedded team rather than an outside vendor, but without the fixed overhead of full-time hires.
Because this model flexes with scope, the cost of a fractional marketing department typically lands well below the cost of a full in-house team while still delivering director- or VP-level strategic thinking that most companies in the $4M-$80M range can’t otherwise afford to hire full-time. It’s also faster to start than a hiring process and easier to adjust than a headcount decision, which matters for companies with needs that change from quarter to quarter.
| Your Revenue Range | Your Title | Problem You’re Facing | What You Actually Need |
| $4M-$12M | Founder or CEO | Outgrowing freelancers and inconsistent tactics | A coordinated system without building a full department |
| $12M-$35M | CEO, COO, Marketing Director | A small internal team that can’t cover both strategy and execution | Senior strategy, specialists, accountability |
| $35M-$80M | COO, VP of Marketing, CMO | Complex website, multiple locations, attribution gaps | Stronger search visibility, conversion, cross-channel performance |
There’s no universally “right” answer among the three models. Rather, there’s a right answer for where your company is right now. A $6M company drowning in freelance invoices needs coordination, not three new employees. A $50M company with a lean internal team and a highly customized website needs senior specialists layered on top of what already exists, not a one-and-done website rebuild.
What do these models look like in real life? At Hearthstone Marketing, we have touched all three and can speak to how they differ from one another. Here’s how they’ve played out for real clients of ours.
One Hearthstone client, a medical device startup in its first few years of operation, already had a Marketing Director and a Marketing Coordinator on staff. They filled gaps with freelancers sourced through Fiverr. The problem wasn’t a lack of people–it was volume. The team was fielding a flood of marketing requests with no system to manage vendors, prioritize work, or move projects forward. The Coordinator was stretched too thin to keep everything running.
That’s when the Marketing Director engaged Hearthstone. We stepped in as a fractional marketing department rather than a new hire or a traditional agency. I served as a senior strategist, working directly with the Marketing Director. This meant sometimes building the strategy for the Director to vet, sometimes reviewing the strategy the Director had already built.
At the same time, our project manager at Hearthstone took over day-to-day execution, moved the team onto ClickUp, and gave the Director’s existing freelancers delegated access to the same system. Nobody was let go. In just over two months, the team’s output doubled in efficiency and the existing headcount finally had a system.
A different Hearthstone client, a home battery company competing directly with Tesla, came in as a straightforward agency engagement, layered on top of an existing in-house marketing team. The gap was social media: no cohesive strategy, consistent visual identity, and a growing list of disconnected posts. The user experience was lacking and not driving users to the company’s website.
Hearthstone built social templates to unify the brand’s presence, then worked with the in-house team to gather content for the posts themselves. Hearthstone built an ongoing content strategy across LinkedIn, Instagram, and Facebook, posting natively on each platform for stronger engagement. The result was about a 20% increase in followers and engagement across all three.
What made this engagement different is what happened next. As the client’s internal team grew, Hearthstone trained the new hire on the social media strategy and workflow it had built, then handed off day-to-day posting once that person was ready. That kind of handoff is rarer than it should be.
Marketing training budgets have fallen to just 3.8% of total marketing spend, down from a pre-pandemic high of 5.8%, even as the skills marketing teams are expected to have continue to expand. Similarly, 60% of small businesses are using AI as part of their marketing and 15% are using it to avoid having to hire more people. An engagement that transfers real capability, not just deliverables, is closing a gap most companies have to quietly absorb on their own.
Fractional marketing typically costs much less than an in-house marketing team of three to four people, which often runs between $300,000-$500,000 a year in salary, benefits, and tools alone. Because scope flexes with the needs of your company, a fractional marketing team offers strategic leadership without carrying large overhead costs.
In our experience, fractional marketing tends to fit companies roughly between $4M and $80M in revenue, as that size is big enough to need senior strategy and coordinated execution, but not yet large enough to justify a full internal department. Where you fall in that range shapes the type of support you need–coordination, specialists, or training.
Yes. Fractional support is often layered onto an existing team rather than replacing it, adding senior strategy, specialists, or project management capacity where a lean internal team is stretched thin, not taking over marketing entirely.
Typically, an agency is hired to provide defined, channel-specific deliverables, such as a website, series of blogs, social media ads, etc. Alternately, a fractional marketing department takes ownership of overall strategy and outcomes, functioning more like an embedded team member than an external vendor, while still being flexible in cost and scope the way an agency is.
A fractional team can start within weeks rather than the months required to hire and onboard in-house hires. Because of this, in Hearthstone’s experience, improvements in marketing coordination and execution can be demonstrated within 90 days. Larger strategic and revenue outcomes typically build over six to nine months.
Our recommendation to you is to choose the model not based on whichever one feels most familiar. Rather, you’ll see the best results when you run the numbers on all three. Price out a realistic addition to your current in-house team. Get an actual agency proposal with defined scope. See what a fractional model would cost for the same coverage. That data will guide you to the right decision for your company.
Still not sure where your company falls? Hearthstone’s free marketing analysis takes an in-depth look at your search visibility, brand coherence, and website conversion opportunities. It’s a pretty comprehensive deep dive and you’ll walk away with clarity on the gaps in your current marketing function and which model can best serve you.
