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If you have a background in the world of marketing or want to start a business that allows you to think creatively and recommend solutions for a wide range of clients, launching a marketing agency could be a great option. The global digital marketing and advertising market alone is estimated to be $ 322.5 billion and is projected to grow to $ 640.2 billion by the end of 2027. Within this industry, you can capitalize on any number of subfields, including specialized niche areas where there is not much competition and fast-growing areas with high-profit potential.
Of course, starting a marketing agency from scratch is not easy. To be successful, you will need to follow some important principles and strategies.
Get experience (one way or another)
First, you will want to gain experience. As the CEO of a marketing agency, with virtually no marketing experience, it will be difficult for you to make good recommendations to your clients.
The most common way is to earn this experience for yourself. Start out as a freelancer, providing small-scale marketing services to a limited number of clients. Or develop your skills by working for an established marketing agency.
If you don't have much of your own experience and want to start earlier, you can take advantage of the experience of other professionals.
For example, you can:
- Associate you. If you are business-minded but have limited marketing experience, consider partnering with a true marketer who knows little about business. Partnerships that complement each other often work well.
- Hire someone. You can also make up for your lack of experience with a group of highly experienced employees. With the right equipment, your minimal experience will not be a problem.
- Work with investors. If you have at least some experience, you can rely on the help of investors to guide you in the early stages of agency development.
- Work with suppliers. You can also work with vendors as a primary source of recommendations. In this model, your agency will function more as a conduit than a direct source for marketing strategies or tactics.
Find how to distinguish yourself
There are more than 40,000 advertising agencies and the like in the United States. That's a lot of competition. To find customers and establish your brand reputation, you will need a way to distinguish yourself.
Fortunately, there are many options for doing this. For example, you could target a specific type of customer, depending on their company size, industry, or stage of growth. You can also focus on a specific area, attracting only people from your city or state. Additionally, you can distinguish your brand by offering a unique voice or perspective on marketing in general.
Don't be afraid of 'white labeling'
One option for new agencies and inexperienced entrepreneurs is 'white labeling'. Thus, you will work with another agency offering their services to your end client, as if they were yours. Depending on the nature of this relationship, you may be able to strategize, execute tactics, and even produce reports through your partner agency; and all these assets will be presented by your brand.
You will pay for these services in advance, usually slightly increasing the price for your end customer. The profit margins are reasonable, your client still gets a great price, and you can be sure that your clients get the best quality work.
Image: mihailomilovanovic via Getty Images
Practice what you preach
As a marketing agency, it is important to practice what you preach. For example, let's say your agency formally recommends search engine optimization (SEO) to your clients. If your clients perform some basic searches on your agency's website and can't find you, this is a sign of your agency's incompetence, hypocrisy, or both.
To make a good first impression and attract more customers, you must master all the strategies you are recommending.
Serve your first customers well
Your first customers will be the most important. This is your chance to show what your agency can do, and often the first clients serve as a gateway to a potentially endless chain of referrals. Do whatever it takes to make these first few customers happy, even if it means taking small losses or making additional sacrifices.
Have a plan to climb
Marketing agencies' profits are not surprising, especially if they are outsourcing most of the work. If you want to make money in the long term, you will need a plan to scale and attract more customers. There are many ways to do this, each with its own advantages and disadvantages. For example, you could spend more money on marketing and advertising, establish a referral program, or open new branches in different cities.
Starting a marketing agency is difficult, especially if you have little experience in the marketing industry. But with the right strategy and adjustments at these important points, your business has the potential to take off.