How To Start And Run a Digital Marketing Agency Business in 2024

Picture a business realm that is continuously growing each year with no doubt; without slowing down. Yes, we are talking about the digital marketing agency business.

The digital marketing agency business is expected to grow in the coming years. According to a report by Statista, the global digital advertising market is predicted to reach $1 trillion by 2027. That’s also making 2023 a great time to start your own agency. But with so many digital marketing agencies out there (including AI agencies), how do you make yours stand out?

Read on to discover how to break into the marketing world and watch those big checks fly in. 

New in Town: How to Start a Successful Digital Marketing Agency?

Ready to join a rapidly growing industry with a lot of potential? Rule one: Starting a new business is never easy, and the digital marketing industry is no exception.

Just after deciding you will set your heart on it, the first thing you need to consider is what type of digital marketing services you want to offer. What industries do you want to work with? It’s a quite crucial step to successfully define your niche early & focus your marketing efforts and attract the right clients.

Next step? Keep reading.

Quick Tips for Success

From carving out your niche to mastering the art of online marketing, you may need some tips before setting up your own digital agency. In other words, before diving in, it’s crucial to cross your T’s and dot your I’s by conducting thorough research and crafting a well-thought-out business plan.

Let’s make it together.

  • Tip #1: Educate Yourself

Before leaping, it’s undoubtedly important to lay a solid basis of knowledge and understanding. Much like some of the most prosperous people in the world, who never quit learning, you may want to prioritize your professional knowledge via education.

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At this point, it’s a good call to begin by immersing yourself in the world of digital marketing for agencies. Explore online courses & resources offered by well-known institutions to enhance your digital skills plus industry know-how. Investing your resources in continuous learning and grasping the nuances of this dynamic industry will pay off handsomely in your journey ahead.

  • Tip #2: Conduct A Competitive Analysis

As you already know, having a clear picture of where you stand compared to your competitors is like having a detailed map to drive your entire journey. When you analyze your competitors, you are discovering how to keep pace and leap ahead.

For a complete competitor analysis, focusing on the keywords required for your business’s online presence is a good call. Think of these keywords as the markers that direct customers to your business & those of your competitors. For instance, in case you’re in the e-commerce sector, consider how often keywords like “online shopping” or “best deals” appear in your competitors’ content.


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While doing that analysis, do not hesitate to narrow your focus to about 10-15 key competitors which share the same digital landscape with you. In the same manner, diving into how your competitors generate their income provides you with detailed insights. So much so that, by dissecting their monetization strategies, you gain an insider’s view of what’s driving their success.

Some examples of monetization methods are:

  • Donation, commission, coaching,
  • Selling a digital or physical product,
  • Lead generation, affiliate sales, advertising.

Once you unravel authorized competitors’ tactics, the next step is to uncover their content marketing strategy. Check out their blog posts, social media accounts, and SEO efforts. Are they using podcasts, blogs, or videos to connect with their audience?

Following that, study their communication style with their customer base. Are they adopting a friendly and informal tone, or do they maintain a more professional style? This analysis will give you a sense of how they build relationships with their current & target audience. Take Hubspot as an example when it comes to bold content strategy:

  • #Tip 3: Set a Business Model 

When it comes to billing your clients, there are various methods to consider, and the choice is yours. One option is the hourly rate, which is good for one-off tasks. However, as your business scales up, managing this billing method can become more complicated.

Another pricing model is the balanced retainer, where you charge a fixed monthly fee; it’s important to set clear terms, especially regarding early terminations or adjustments in client requirements.

Alternatively, you might opt for a percentage-based model, tying your compensation to your client’s spending. This approach ensures that your digital agency is rewarded for your efforts. To determine which pricing model suits your business best, you can also refer to our digital agency pricing guide for more insights.

How to Run a Digital Marketing Agency?

Let us start with a fact about running a digital agency: Keeping clients happy and engaged over the long term. So, the efforts to fix it are the actual answer to how to run a digital agency in 2023.

As we mentioned before, the digital marketing industry is extremely competitive, with many agencies vying for the same clients. In this section, we’ll be focusing on the best practices.

  • Network with Potential Clients

Since the very first stages of marketing & sales, networking has been a great way to meet new people and build relationships and position your agency as a thought leader in the industry. It’s still true.

As a “new” agency owner, networking gives you a chance to share your expertise and insights with potential clients. This can also help you position your agency as a thought leader in the industry and attract more high-quality clients. Attending industry events, joining online communities, delivering valuable content resonating with your target audience, and reaching out to potential clients directly are just a few ways of networking.

  • Offer Free Talks

When compared to networking, giving free talks (consultation) is a more indirect way to communicate with prospects; however, it also works!

While running a digital agency, the ultimate goal is to position yourself as a thought leader in the industry and attract new leads. Giving free talks through webinars and other trendy educational content is a great way to do this.

  • Expand Your Service Offerings

As the entire marketing ecosystem knows, prospects and current clients demand a “one-stop shop” for all of their digital marketing needs. By offering a wider range of services, you can meet their needs while differentiating yourself/your agency from the competition.

Expanding your services also helps you increase your revenue potential. At that point, remember that trying to offer a wide range of services can be tricky if you do not have an extended team of professionals.

  • Benefit from Resources for Digital Marketing Agency Owners

Taking advantage of valuable resources for digital marketing agency owners is another great approach to growing your business. In 2023, fortunately, there are several numbers of platforms and associations offering a variety of resources, including the American Marketing Association (AMA), the Digital Marketing Association (DMA), and the Interactive Advertising Bureau (IAB).

Additionally, you can find online communities (like our platform, Digital Agency Network – DAN) and industry publications to learn new skills and stay ahead of the curve.

How to Develop a Winning Digital Marketing Agency Business Plan

In addition to building a team of experienced professionals, focusing on a niche market, and deciding on digital marketing tools and tech that will be used, opening and running an agency requires a clear vision and a solid business plan.

In this section, we will provide you with all the information you need to develop a winning digital marketing agency business plan.

What are the Key Challenges Facing Digital Marketing Agencies in 2023?

(And How Can They Be Overcome through a Business Plan?)

First thing first: An all-around business plan for digital agencies must address the following components: Vision and mission, target market, competition analysis, objectives, financial plan, team composition, technology infrastructure, and essential tools. Each of these also is linked to the various challenges within the digital marketing industry.

And challenges which digital marketing agencies are up against?

First off, it’s a crowded field, with lots of agencies all going after the same clients. Don’t forget that digital marketing trends and tech are always evolving, and it requires keeping up to stay in the game. Plus, figuring out the ROI for the marketing campaigns can be like solving a puzzle. And yes, measuring ROI is not a picnic; it can be tricky sometimes. However, it is possible to track the progress closely by setting clear goals for each marketing campaign published and using various metrics like website traffic, lead generation, sales conversions, and so on.

When it comes to data privacy and security (another bold challenge in the digital realm), having a bold policy in place and making sure handling data safely is a good call.

Having a well-built business plan helps you find out who your target audience is and how to reach them most suitably and effectively. In the same manner, defining your unique selling points and clients’ pain points sets you apart from the competition. While doing that, it is also important to set realistic and measurable objectives and manage your finances effectively.

And finally, your marketing plan outlines your strategies for reaching new clients, which is vital in a constantly changing landscape. So, with a well-thought-out business plan, you can be better equipped to face the challenges and thrive in the world of digital marketing.

How to Deliver High-Quality Services

Time to dive into tips for delivering high-quality digital marketing services.

  • Staying up-to-date on The Digital Marketing Trends and Best Practices

It’s a no-brainer for agencies to stay in the know about digital marketing trends & best practices, and the reasons are crystal clear. Firstly, the digital marketing arena is in a state of flux, with fresh technologies, tools, and trends emerging. For agencies, keeping a finger on the pulse of these developments is a surefire way to attract new customers. Secondly, prospects today expect their agencies to be not just service providers but also knowledgeable partners who can help them achieve their marketing goals.

Keeping pace with marketing trends also helps you generate leads wisely. For instance, starting a YouTube channel is a great way to generate leads – if it resonates with your target audience (no doubt that you’ll want to have your target customer in mind.) In case you have a YouTube channel, make sure to regularly publish video content to generate leads; some publishing ideas are case studies, hot marketing topics, how-to’s, and reviews from clients. 

Another method is to do affiliate marketing. When you partner with affiliates, you can then expand your network and find potential prospects. You can also do cold emails, but be careful with this method so you don’t come off as spam. 

If you consider all those above mentioned and start generating leads, before things get complicated, you should implement an agency management solution into your system to run your operations more effectively. We have made a good selection of the best agency management software for your agency.

  • Developing a Process for Delivering Services

Creating a smooth service delivery process is another must for digital marketing agencies. This well-structured process ensures that customers receive consistent, high-quality services, no matter who’s handling the project.

Starting by identifying the necessary steps for each service you offer is a good call. After deciding on what tasks are essential to provide top-notch service, try to document each step in detail so that everyone on your team knows what needs to be done and how to do it.

You can also assign specific roles to your team members and develop a timeline for each step to expectations for completion. Additionally, you may want to put quality control measures in place to make sure the work meets your agency’s standards.

  • Communicating regularly with clients and providing updates on progress

Speaking of building trust and ensuring everyone’s on the same page, regular communication with clients is a must for digital marketing agencies.

To develop a regular dialogue, starting by setting clear expectations with clients from the outset is a good approach. In the initial discussions, discover how often clients would like to receive updates and what specific info they prefer to be kept abreast of.

Waiting for clients to request updates is far from ideal; instead, take the initiative to reach out regularly, providing insights into the project’s progress. In case any problems or delays rear their heads, it’s paramount to convey these to clients as soon as they emerge. Honesty is the best policy here.

Absolute Must: Taking Advantage of AI While Running Your Digital Agency

It’s high time to discuss how AI in digital marketing delivers high-quality services. We will cover a variety of topics, including personalization, automation, insights, and creativity.

The talk of the town, AI is a great helper to deliver high-quality digital marketing services. From personalizing campaigns to automating tasks, AI can improve the results and achieve your business objectives.

As an owner of a digital agency, you (and your team) can use AI use to revolutionize your marketing strategy – personalize marketing campaigns and messaging, making them more relevant and effective for individual customers. In addition to the ability to recommend services to customers based on their past behaviors, via AI, you can segment email lists, create personalized landing pages, and more.

What’s more, AI frees up your time by giving you a chance to automate repetitive tasks, such as social media posting and email marketing. As a result, you can focus on more strategic tasks, such as developing creative campaigns and analyzing data.

Speaking of analyzing data, AI also generates insights into customer behavior and market trends. This information can be used to develop more effective marketing strategies.

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