We understand that hiring a marketing agency is a big decision.
Our goal is to empower you with honest and reliable information about what marketing services cost so that you can make a decision that’s best for your company and your budget. We’ll aim to answer some of the most common questions we get asked and provide insights that few agencies are willing to share. Let’s begin.
Why do the costs vary so much between different marketing agencies and freelancers?
So, how much do marketing agencies charge? Every marketing agency charges a different rate, and for a reason. It’s pretty simple to explain why the cost ranges so greatly. Lower-cost agencies usually do less customization or have less experience. Higher-cost agencies usually have more experience, spend more time developing your strategies and content, have tried-and-true systems in place to make sure that things are running successfully, and will usually spend more time talking to and meeting with you.
If you have specific sales and conversion goals, then hiring an experienced marketing agency is probably where you need to be.
Let’s get down to it. Here’s what the costs could look like if you hire an experienced marketing agency.
Hiring an experienced agency that focuses on sales and conversion (like Potluck Consulting) will typically cost a starting rate of $2,500/month. With an investment like this, you can expect to get a contract for 6 to 12 months.
Why do marketing agencies have longer-term contracts?
If an agency is providing a customized service for you, there are going to be 2-4 weeks of setup time needed. During this time, they’ll gather logins, files, talk to you about your goals, do an audit on what you’ve been doing, develop a marketing strategy, and then front load and create all of the pieces needed to launch. Two weeks is fast but possible. This is a lot of work and time spent collaborating with you to make sure that they’re creating the best plan possible to meet your needs. Consider this month one of working with your agency.
After your setup month, everyone will be excited to hit go! This first month live is where we all act like scientists and track the progress of our initial strategies in the most controlled ways. If things don’t work, we’re back to the drawing board and need to create a new plan to achieve your goals. If things look promising, we don’t stop there. It’s time to optimize. We take hold of the tactics that worked and double down, tweaking as needed. This process never ends.
It truly takes at least two months to start to see things snowball. Remember, month one is set up. Month two is launch. Month three is fine-tuning and optimize. Within six months, the goal is to have a well-oiled machine that allows you to continue to invest in the things that work bring a profit, and therefore expand your budget to test and explore new opportunities. This takes time and expertise to accomplish.
How do the costs of marketing services increase with your needs?
While every agency has their base rate for services, carefully calculated by years of experience, wo-man hours spent on a project, and what they’re going to deliver to you in return, these rates can increase based on a few project needs:
- The number of social media accounts you’re asking them to manage.
- The number of emails, blog posts, and social media posts in a month they’ll need to create to implement the strategy.
- The number of ad drafts they’ll need to create along with the total ad spend ($) they’ll need to manage and watch closely, in our case, daily.
- If you’re asking them to customize their workflow for your project, outside of their tried-and-true process.
- If you need standing calls or in-person meetings every X number of days.
For example, here’s what various projects could look like.
If you’re looking for social media management services with paid advertising, this is where your base rate of $2,500 comes in. Most people start with this combo and then scale up at the 3-6-month mark once they start seeing a return. Remember, if you need more content or more social media platforms, more than a starting point of 2 social media profiles, then you can expect this base rate to increase by about $300-$500 increments per additional platform depending on content quantity. Because your agency will be creating strategic content for each platform, they’ll need to set aside time and use their brainpower to tackle this strategically.
If you also need to include email marketing, you can add on $1,500+ to the base rate. Similar to social media marketing, this rate increases based on the types of emails that need to be set up and the quantity of them. Your marketing agency will determine an email marketing strategy that works hand-in-hand with your organic social media marketing and paid ads strategy. If you have an eCommerce brand (online shopping!), then the strategy will likely need to be more complex and with more emails to keep your customers moving through the sales funnel.
If you need ongoing content created for your website and plan to have it optimized for search engines, then you can expect to add $900+ a month to your scope. This service is one that can increase in cost quickly based on the number of blogs and pages you might need to be created a month. Most brands choose to publish 2-8 blog posts a month and optimize for search. With two blogs as a starting point, you can work your way up to 8+ (if necessary).
What else do I need to be aware of when thinking about working with an agency?
Depending on how the agency is structured, there can be other costs that you will need to consider to really get a full picture of what your investment looks like.
Here’s a short list of things that might come into play:
- White labeling and contractors
- Paid advertising spend
- Software and subscriptions
At Potluck Consulting, the marketing work our clients hire us for is done in-house. We do not white label our services to anyone nor do we hire subcontractors to service the main parts of our contracts. This means that every strategy and main project piece you get from us is done by an employee (not a contractor or another agency). To be fully transparent, on occasion, we do contract a copywriter or two to help give our team a hand with writing needs, but again, all marketing efforts are handled in-house and by our full-time staff. This keeps your costs down and ensures that a dedicated person who knows your brand is working on your project throughout every stage. We prefer to do it this way because let’s be honest, it’s the most transparent, efficient, and cost-effective structure for our clients. We’re not about industry standard and instead, want our clients to get the most out of their investment.
Why do we bring up white labeling and contractors? Because it’s extremely common in the digital marketing industry for agencies to sell a service that they don’t actually know how to do or don’t offer in house. Many brands need a variety of solutions to clients and unless you have a large marketing agency, it’s impossible to offer everything. This is where white labeling and contractors come in. Many marketing agencies re-sell services offered by other people or agencies to bulk up contracts or submit proposals that include a scope they can’t provide in full. This is called “white labeling”. It’s like repackaging a service that someone else does. “Hiring a subcontractor” is also common practice in the marketing industry. This is where an agency brings in someone to do part of their job and handles the costs under their contract. In both of these cases, you’ll likely be paying more for the service than if you were to go directly to the person offering the service. Above we mentioned occasionally hiring a copywriter. When we do, Potluck Consulting always absorbs the cost so that there is no additional cost to the client.
Moving on to paid ads – if you’re planning on running them through an agency, you need to know that most agencies don’t pay for your advertising spend. Advertising spend is the money spent to place the ads you’re running. The reason agencies usually don’t pay for your ad spend is that it’s an accounting nightmare and if you tallied up all of their clients’ budgets, it could account for hundreds of thousands of dollars (if not more). It’s best for both parties to just keep this separate. You’ll want to chat with your agency about what type of budget you’ll need on top of their service fees if they’re going to manage your ads. On top of the paid advertising spend, it’s common for an agency to charge a management fee (a percentage) on the total ad spend spent each month. This ranges greatly from agency to agency and is in place so that the person managing the ads can spend the time needed to monitor and adjust their ads as needed. At Potluck Consulting, we monitor your ads’ progress daily and charge a 15% management fee. Big media companies, like newspaper companies that offer paid advertising, can charge up to a 35% management fee.
Another thing to think about is if you’ll need to create accounts for and pay for third-party tools. This could include email software, apps for your website, or even a couple of hours to have your developer install or change something on your site for the campaign. Always ask if there are any additional costs like this in the proposal process.
Well, there you have it. Is hiring a marketing agency right for you?
You can now stop Googling “how much do marketing agencies charge”. The cat’s out of the bag. That’s how marketing agencies like Potluck Consulting price their services. If you’re feeling informed and excited to jump, contact us to start a conversation about your marketing goals. We look forward to chatting with you!
Let’s get started