Updated: February 15, 2023
Let’s take your digital marketing agency down a brief trip back in time to 1990. If you wanted to create a marketing agency back then, the barriers to entry were enormous.
Without an initial investment in the early worlds of the digital landscape, you were out of luck.
Most marketing involved traditional or physical media. The amount of administrative work required to prove you were providing a strong ROI was enormous. Many marketers started, few finished, and that was the expectation.
You were lucky if you got a chance to succeed.
That was then. Today is a very different story.
DMAs Can Be Built In a Day
Small teams and skilled freelancers are able to create a fully capable digital marketing agency (DMA) in just months. With commission-based platforms, tools like WordPress, and some personal expertise, it is possible to run a solid agency on a shoestring budget while still earning a comfortable living.
Getting started is just the first step, as you know. Once you start taking on jobs, you have three options: keep growing, stay comfortable, or quit.
We’re going to assume that you want to keep growing. Here are some ideas that can help you do just that.
You Must Begin with a Strong Foundation
Marketing is two parts skill and one-part talent. You must create a strong foundation which includes both before you even get started with your DMA.
Any combination of skill and talent can make up these parts thanks to the structure of digital marketing today. You have content writers, website coders, graphic artists, and video producers all part of the modern DMA.
If you have one of those creative talents, then you have the potential to be a marketer.
You must also know how to handle relationships, manage accounts, and develop professional networks. This requirement is why many marketers, even today, find themselves struggling to hold onto a marketing job.
Then you must know how to drive results. A 100% success rate with marketing is unrealistic. What businesses want is consistency. You can only have consistency if you have experience backing up your work.
Your first step must be to develop the necessary skills needed in the world of marketing.
Mike Ramsey, President of NiftyMarketing, also says that you need a reason which goes beyond money to have a successful digital marketing agency.
“Of course, you need to make money,” Ramsey says, “but if that is the only thing you are looking for as a business owner, then you will eventually fail. You will make decisions that aren’t for your clients, or for your staff, or for the community; you will get short-term gains and create long-term failure.”
To continue the foundation building process, there are 4 additional points to consider.
Join a Team or Be a Contractor First
It is a big leap to go from working for someone to earn a paycheck to working for yourself. There are so many risks involved in a personal business that going all-in unaware of them can be cataclysmic. If you love marketing, then roll up your sleeves and get your hands dirty with the work. See how much you really love the world of marketing.
This will allow you to explore options, build networks, and get a taste of striking out on your own without the same levels of risk involved.
You do this for one reason: the best clients you get as a marketer come from referrals.
“When someone refers you, the chances of you closing that deal are really high,” says Neil Patel, an SEO expert and founder of his own digital marketing agency. “But if you treat that client poorly, not only will they stop paying you, you’ll notice that the number of referrals you get on a regular basis will slowly start going down.”
Develop a Strong Business Model
You can setup a DMA in several different ways. Most companies will either charge a flat fee, require a retainer, or take a percentage of what is being spent. Some companies operate on a billable hours concept as well.
Any of these approaches will work to create a strong business model. What you choose depends on the type of services you’re providing. Research-based tasks make more sense to charge as billable hours. If you write content, a flat fee or retainer might be a better option.
Two key points to consider after you start making money: insurance and taxes. It is a good idea to structure your agency as an LLC to protect yourself if something goes wrong. If you do create an LLC, then having an accountant or tax professional handle your finances will take some administrative work off your plate.
Carve Out Your Niche
“Whenever I was hungry, I took whatever client walked through the door,” says Ramsey. “I took abuse. Emails that called me names, clients who would not listen to my advice and would then blame me when things went wrong. Clients that paid 3 or 4 months late, but would complain when I didn’t answer my phone on the first ring.”
When you carve out your own niche, you are taking a step away from the idea that you need revenues. You can take the energy that gets put into these difficulties, apply it elsewhere, and enjoy a better quality of life at the end of the day.
Many marketers think they’re carving out a niche, when what they are actually doing is trying to find personal happiness. No amount of money, fame, or success can make up for a lack of happiness.
Find the skill you’re good at, that you’re passionate about, and then create a service around it. If you’re an awesome writer, then write. If you hold a degree in graphic design, then do it. Don’t try to be something that you’re not.
If you’re stuck on ideas, WordStream offers that can help you create a specialized marketing business.
Learn the Red Flags
There are times when you must be willing to tell people that they’re not a good fit for your DMA. You must draw a line with the customers you decide will receive services. You can do that by recognizing the red flags of a problematic client.
Rude behavior is the most common red flag you will see. Being blunt or abrasive is not being rude. Interrupting you during a presentation is rude. Being personally attacked is rude. Insulting your skills, company, or performance is problematic. Learn to walk away.
Watch for these additional red flags as well.
- Commitments that are broken.
- A general lack of communication.
- Refusing to listen or go through information you’ve provided.
- Unrealistic expectations for results.
There are always some exceptions to consider. You might have a client with a project that must be completed in a short amount of time and that just isn’t possible on your end.
It’s going to be a judgment call. At the end of the day, if you suspect a red flag, it is easier to walk away.
Minimums Are Important for Pricing
If you’re flying solo as a marketer, then you can pull a good margin, make a decent living, and offer a competitive price. You’ll find many solo marketers pricing their services in the $500 to $1,000 per month range.
They might put in 60 hours per week, work weekends and holidays, and take a variety of jobs. If you can hit your target salary figure for the year, it feels like a success.
To grow your DMA, you must set your sights beyond this first, initial goal. Being flexible with your schedule and being personally selective of the projects you take on has value.
It just doesn’t have a lot of value.
Imagine that you’re making an average of $500 per project right now. What would happen if you set your minimum to $2,000 instead?
Would you lose some (maybe most) of your clients? Probably. You would also find that the customers who did come your way would still give you the flexibility you need.
You can charge $100 per hour. You can charge $500 per hour. There are customers out there who will pay you for these services, at these rates, if you can do one thing: prove your value.
Far too often, the world of marketing forgets that what is being provided is a service. There are important creative elements to marketing that make it a form of art, but this art has the goal of growing a business.
Not every business can afford a premium rate. If you like to work with small- to medium-sized businesses as a marketer, keeping your rates lower has personal value that must be considered. At the end of the day, however, DMA growth requires good employees. Good employees require a competitive wage.
You won’t be able to pay that way if you’re trying to make ends meet at $500 per project.
“As a rule of thumb, most consulting fee rates should double, or in most cases triple, the actual wage of the position being covered,” says Daniel Herndon, Principal and CEO of MilesHerndon in Indianapolis.
“That means that the $50 per hour strategists should charge $100-$150 for his services. Generally, a freelancer is in the double category and consultants in a broader company, which includes physical overhead, are in the triple category.
Growth Means Being Able to Retain People
“The fastest way to lost clients and employees is to lie to them,” says Ramsey. “If you want both to stick with you through thick and thin, then there has to be 100% trust.”
How can you build trust with your clients?
The Forbes Coaches Council offers several suggestions that can help you and your digital marketing agency begin the trust-building process.
Lead with your stories, not your sales pitch.
Using a story, or a joke, helps to create neural connections which make a marketing message more memorable. Anchor your message to your story, not your sales pitch, to create a lasting and positive first impression.
Ask about ways you can help.
When you ask someone if you can help in some way, then you are initiating an allied relationship. You’re telling them that you want to be on their side. This gives you a chance, as a marketer, to examine their potential pain points to see if you can find meaningful solutions.
Always be authentic.
Some marketers are tempting to talk big about themselves. A little bragging is common in sales. What you must focus on is authenticity. Selling snake oil will only work for so long. Show people your results. Let them make the decision to join your network. If they decide you’re not for them, shake it off and go to the next future customer.
Offer a free consultation.
Many companies have been burned by false promises in the past. Offering a free consultation does more than get someone through your door. It is a chance for them to see how you will deliver results. You get the chance to see what challenges they face. They get a chance to become confident in who you are and what you do.
Be quick with a referral.
Use your network to the advantage of each current or future customer. If someone has a key challenge which must be solved, send them to the expert you trust that will craft the solution which is required. Even if you lose a contract now, the help you provided won’t be forgotten in the future.
Listen with active intent.
When a great idea strikes you as a marketer, it can be difficult to stay quiet. Instead of peppering people with questions, let them describe their pain points. They will show you the challenges they want you to solve. Confirm what you’ve heard by actively listening to each key point. This will transform your relationship from one of dialogue to one of understanding.
Then make sure you get the work done correctly the first time around.
“Can you imagine a lawyer who said, ‘Here’s the contract, take a look. If it turns out it’s not right, we can later,” says Malcolm Gladwell, a best-selling author on marketing and sales, as well as a staff writer for The New Yorker.
“Are you kidding? That’s a disaster.”
How a CRM Fuels DMA Growth
Marketing is about finding practical solutions for others. You’re looking at pain points, finding solutions, and then offering a strong value promise.
Far too often, marketers don’t do the same thing for themselves or their companies. A digital marketing agency grows when it has access to practical tools.
That is why a CRM is essential for DMA scalability.
At LoTops, we offer a in the cloud that is perfect for small businesses that are looking to grow.
It is a system that is intended to do more that manage your leads, contacts, or opportunities (it does that very well, though). Our CRM software provides you with an activity feed, so your entire team always knows what is going on.
We’ve included seamless integrations for Outlook and Office 365, as well as Gmail and G Suite, to take care of your email marketing needs.
Get the Data Insights You Need
Our platform will provide you with data insights, through clear charts and visuals, to understand what is in your pipeline and when it is due.
One of our unique options is called, “Allies.” An ally is someone who may be a vendor or a partner. They’re not someone you’re trying to sell your marketing services to at the moment. This gives you the ability to maintain a list of important network contacts, with pictures and a map location, so you can be in contact or offer their information to someone when the need arises.
For those who love data, our CRM will provide you with key insights from your Dashboard, including revenue and pipeline KPIs, so you always know the status of your business.
Communication Must Be Part of Your DMA Growth Plan
How fast do you return your emails?
In a world where comments left on a social media have an expected response time of 12 hours or less, allowing an email from a lead to sit for 24 hours or more creates problems.
It’s even worse if a complaint is involved. 42% of consumers who complain on social media expect a response time of 60 minutes or less.
As a digital marketing agency, you have turned to the Internet as a way to generate leads. That also means you have turned to a solution where speed is a priority.
Research published by the Harvard Business Review indicates that the companies who follow-up quickly with a lead are the most likely to secure a sale for their services.
Over 2,200 companies in the United States were audited to determine how long each one responded to test leads that were web-generated. The research showed that 37% of companies responded to their lead within an hour.
It also showed that 1 in 4 companies took more than 24 hours to respond to a lead. 23% of the companies that were audited never responded to the test lead at all.
For all the companies that responded with a 30-day period to the web-generated test lead, the average response time was 42 hours.
Online leads go cold quickly. A firm that works to contact a prospect within 60 minutes of receiving their inquiry are 7 times as likely to have a meaningful conversation with that person than a firm that establishes contact within 120 minutes.
For companies that wait 24 hours to respond, the firms who responded in the first hour were 60 times more likely to qualify the lead.
Additional Ideas to Help Your Digital Marketing Agency Grow
To grow your digital marketing agency, you must be able to market yourself.
One of the most effective ways to market what you do is to build case studies from the successes you’ve already had.
Make sure to have the permission of your customer before building the case study. Then lay out the specific strategies you used, backing up the success with the actual data that was generated.It is a good idea to have multiple case studies created, so you can match the data you have with the persona of your potential buyer.
If you struggle to create case studies on your own, Joel Klettke runs a service called Case Study Buddy which can help you put together the information in a meaningful way.
Another option to consider is to start guest blogging. It is popular for marketers who offer search engine optimization services, but it is effective for every digital marketing agency. Try to rank for specific terms in your city, county, or state/province that you feature within your agency.
The link building may give your rankings a boost over time as well.
Then make sure you’re getting feedback from your customers on a regular basis. Once of the best tools you can use is called the Net Promoter Survey.
It is a metric which allows your customers to rate the effectiveness of what you do. It is a 0-10 score-based system which breaks down the likelihood of receiving a recommendation.
If you receive a score that is a 9 or a 10, then you’re more likely to receive a referral. A score of 7 or 8 is considered passive. Anything below 7 creates a risk of negative feelings which could damage your brand.
You would then take your percentage of promoters, subtract the percentage of detractors from it, to get your Net Promoter Score. Anything above 0 shows the potential for growth.
Taking a more traditional approach is also useful for some digital marketing agencies. Send out handwritten letters as a component of your onboarding work. If you don’t have the time to write out each letter, consider using a service like MailLift, where the content of each letter is handwritten individually by a real person.
MailLift will then ship the letters from your location to ensure that the service creates the correct impression for you.
As a final step, you might want to look at using freelancers or offshoring to offer a full suite of services while you keep growing your DMA. It can be difficult to find the right people sometimes, but if you do, you will have the opportunity to expand your footprint quickly and reliably.
Increase the Value of Your Existing Clientele
When you start thinking about growth within the context of a digital marketing agency, then your biggest opportunities aren’t going to be found without.
They will be found within your existing network of customers. Knowing how to renew your retainers or contracts, or how to upsell your clients, will fuel tremendous growth when you get this skill right.
Upselling is 20 times more effective than cross-selling. 4% of sales are driven by upselling, compared to 0.2% of sales which are driven by cross-sales tactics.
How do you create an effective upsell?
It starts by delivering a message that is relevant. You must offer a premium service which is related to the pain points the customer has already discussed with you.
Without relevance, there is no opportunity for a bigger sale.
Scarcity is another component of upselling that is effective. When you’re providing a service, it is important to remember that time is a commodity which provides scarcity for you.
If you have a deep pipeline of work, scarcity encourages an upsell because your customers want to make sure their order is going to get noticed.
You Must Increase Your Perceived Value
Then increase the perceived value of the marketing services you are offering. Amazon does this by grouping products together, then listing a price for all of them. Those products aren’t offered at a discount price. It just seems like it would be cheaper to purchase all the items together.
From a marketing standpoint, you can do the same thing. Offer individual services, like SEO, email marketing, or social media marketing at a specific price. Then bundle packages of services together at a rate which is similar to the individual prices.
With the increase in perceived value, the number of future customers coming your way may begin to grow.
Bundling is effective. When people wait to purchase items, the act of bundling boosts the temptation to make a purchase.
Then you must keep working to build trust on the individual level. Trust can improve a customer’s loyalty to your business by 44%.
Drive Home Your Integrity as a DMA
Communication, management policies, and the previous experience that you have with marketing are all drivers of higher trust.
To communicate that you are interested in this transactional relationship, customers look for transparence. They want advance information on any discounts or deals you might offer. They’re also looking at your problem-solving capabilities.
As a final step, look for ways that you can “over-deliver.”
When customers are shopping for a service, they have a specific expectation of an outcome in mind. Your goal is to discover this definition, then exceed that expectation.
If you are able to over-deliver on your marketing efforts, then you’ll make your customers happy. It will foster a closer relationship over time.
Take Your Digital Marketing Agency to the Next Level
Sir Martin Sorrell, who serves as the Chief Executive Officer of WPP, the world’s most profitable marketing group, says that digital is one of the biggest areas of potential growth he sees in the future. Instead of picking out one channel and running with it, he suggests looking at them collectively.
“Picking channels out is a mistake; they all add up to a combination that is productive,” Sorrell says. “There are dangers in going too far one way or another.”
To take your digital marketing agency to the next level, you must be able to walk the walk instead of talking the talk. Work to reduce your response times when a query comes along. Prove you are the best at what you do by showing future customers how you will deliver results.
Then put your skills to work for you. Follow your passion. Forge relationships with employees and customers that help you to grow. Be willing to take risks.
Back up these decisions with the proper tools, like a CRM, so you reduce the risk of letting a lead grow cold.
This is an exciting time to be in marketing. Take the opportunity to grow your digital marketing agency and the results you experience may far exceed what you ever hoped to accomplish.