Can you really start a digital marketing agency with no experience? By Mary-Margaret Bennett Given the surging demand for digital marketing services, starting a digital marketing agency can be an exciting journey full of potential opportunities. In 2024, the digital advertising industry alone is anticipated to be worth $695.96 billion (Statista). But, let’s be real, while there’s a lot to gain, there are also challenges you may face along the way. DOWNLOAD your copy of the definitive agency profitability playbook and make more informed decisions driving the growth of your agency today. Even if you lack experience in digital marketing, these risks should not dissuade you. If this is something you are serious about pursuing, and are committed to putting the effort in, success is possible. This article is your guide and handy companion on how to start a digital marketing agency with no experience and carve out your very own niche. Table of Contents Is it smart to start a digital marketing agency? How much risk is involved with starting an agency? Can you start an agency without experience? What’s the best business model to adopt for an agency? How much money do you need to start an agency? How do you get digital marketing clients? Biggest mistakes to avoid when starting an agency Is it smart to start a digital marketing agency? The short answer is yes—if you go about it the right way . On one hand, you’ve got a massive market, potential for serious growth, and profits that can make your eyes pop. But, on the other, it’s no cakewalk. If you are wondering how to start a digital marketing agency with no experience, you’ll need to do your research and have a solid plan in your back pocket. Success in this game means knowing the ins and outs, playing it smart, and maybe a sprinkle of entrepreneurial luck. Case Study: How to Grow a Digital Agency: Boost Your Revenue by 237% How much risk is involved with starting an agency? Nothing worth doing comes without risk, and digital marketing is no different. Navigating these risks requires a combination of strategic planning , adaptability , and a healthy dose of resilience . While the road to success for a digital agency startup may be bumpy, identifying, planning for, and managing these challenges can lead to rewarding and sustainable growth. Let’s take a look at a few of the more common risks you might encounter: Stiff competitive You heard that right. The industry is teeming with agencies vying for your prospects’ attention. Standing out amid the competition is hard, and newcomers often struggle to establish a unique value proposition that distinguishes them from the crowd. Client adoption Acquiring clients is more of a marathon than a sprint. With so many options available to them, convincing a business to choose your agency can be a tough nut to crack. Building a clientele requires a robust marketing strategy, effective networking, and a strong value proposition. Initial periods may involve a slower influx of clients, testing your patience and persistence. Financial constraints There’s no denying that there is a risk of initial financial instability before a steady flow of revenue can kick in. But don’t fret—this period is much more manageable if you are prudent about how you manage your money and invest your resources wisely. Client dependence Handling a small number of clients may be an easy way to go, but there are a few risks to only working with a few select businesses. If a major client decides to part ways, a large chunk of your revenue is gone, and you may not be able to replace them fast enough. Diversification and a steady influx of clients can act as a buffer against the potential fallout from client turnovers. What you can do about it? Unfortunately, roadblocks are a natural part of the entrepreneurial journey. Unexpected challenges, from tech glitches to client dissatisfaction and more, can throw a wrench in your growth plans. It’s important to approach setbacks as learning opportunities, adapting and evolving your strategies so you can emerge on the other side stronger. One way you can stay on top of potential setbacks is through constant learning. Investing time in staying updated and fostering a workplace culture of continuous learning is key to navigating this ever-changing industry. On that note, retaining talent can be challenging as you begin to grow. The industry’s competitive nature means your employees might be wooed by other agencies that can pay them more or offer better perks. Developing a positive work culture, offering growth opportunities, and recognizing and rewarding achievements can help mitigate talent loss. Can you start an agency without experience? It’s daring, but yes, you can start a digital marketing agency without prior experience. The digital marketing industry is vast, and many successful entrepreneurs have launched agencies without a traditional background. When you are determining how to start a digital marketing agency with no experience, the key is a thirst for learning and a willingness to adapt. Here’s what you need to know: Gather meaningful insights Acquiring knowledge about the industry you want to enter is a must for getting your foot in the door. Subscribe to industry newsletters, articles, reports, and journals. Online courses and certifications on platforms like LinkedIn Learning and Google can provide structured learning paths on current and emerging topics. Absorbing the fundamentals of search engine optimization (SEO) , social media , pay-per-click (PPC) , and other channels sets the groundwork for a well-rounded understanding of managing an online presence. Get a mentor Seeking guidance is a great starting point for budding agency owners. Connecting with experienced professionals in the field can provide invaluable insights as you get established. Learning from their journeys, understanding industry nuances, and gaining practical advice can drastically shrink the learning curve you have to overcome. Pro tip: If finding a mentor is posing a challenge, try following industry leaders on LinkedIn. Build a team of experts Your team is the backbone of your success. As you get established, assemble a crew with diverse expertise. If you lack hands-on experience yourself, having skilled individuals who do can fill the gaps. Starting an agency without experience is a bold move, but what matters is that success hinges on your commitment to learning, adaptability, and the strength of your team. The digital marketing industry is much more welcoming to those with a passion for innovation and a hunger for knowledge. What’s the best business model to adopt for an agency? With several options to choose from, you might be wondering what business model would work best for you. The decision you make should not be taken lightly because it shapes your agency’s future trajectory. Understanding the nuances of each model and aligning them with your goals , current resources , and market demands is the key to long-term success. In this section, we will cover freelancing , consultancy , and full-service agency models , what they are, and their pros and cons. Freelancing Description: As a freelancer, you operate independently, offering highly specialized digital marketing services. Pros: Enjoy flexibility in picking projects and working hours. Overheads are typically low, and you have direct client interactions. Cons: Scaling can be challenging as your time is limited. Income can be inconsistent, and you may face competition from other freelancers. Consultancy Description: Consultants and consultant groups provide expert advice in a particular niche and strategic guidance to clients. Pros: Positioned as an industry expert, allowing for higher billing rates. Can take on high-value projects and focus on specialized areas. Cons: Limited scalability due to the personal nature of consulting. Success relies heavily on each individual’s expertise. Full-service agency Description: A full-service agency offers a comprehensive suite of digital marketing services, catering to diverse client needs. Pros: Higher revenue potential with a broader service offering. Diversification minimizes dependence on specific services. Cons: Operational complexity increases, requiring a skilled team and robust infrastructure. Initial resource investment can be on the higher end. Choosing the right fit Consider your long-term vision. If you seek independence and flexibility, freelancing might be the ticket. For those with access to the resources and who aim for substantial growth from the get-go, a full-service agency could be more up your alley. From there, assess your skills and those of your team. If you have expertise in a specific area, consulting might better leverage your strengths. A full-service agency requires a much more diverse skill set. Lastly, try to better understand your target client’s needs. Some may prefer a one-stop shop for all their digital needs, while others might only need targeted guidance in one area. Align your model with these expectations to attract the businesses you are after. Case Study: Digital agency goes from start-up to $250,000 in annual revenue How much money do you need to start an agency? We’re glad you asked. In all honesty, it really depends. Some studies have pegged the number at a couple hundred to a couple thousand. It all comes down to your initial costs of start-up—if you need to hire talent, secure investors, and recurring operation costs, you may need more capital than if you just start off freelancing. While there is no clear-cut answer, in this section, we’ll discuss the nitty-gritty of how much money you need to kickstart your agency and some things you should consider when devising your budget. Initial investment overview Starting a digital marketing agency always involves some upfront costs. SurferSEO estimates that the capital needed to get started can range between $730 and $29,100 . Essential investments include things like: Equipment: Good-quality computers, office furniture, and necessary tech infrastructure. Software: Licenses for digital marketing tools, project management software, and design applications. Office Space: Renting a workspace or establishing a home office. Employee Salaries: If you plan to hire a team, consider salary expenses, benefits, and insurance plan options. When it comes to rationalizing these costs, consider starting modestly and upgrading as more income trickles in. For example, you could start by renting a smaller space outside of popular city centers, obtaining second-hand furniture, purchasing refurbished computers, or outsourcing some of your work to a white-label agency. Key financial considerations As you plan the launch of your digital marketing agency, consider the following: Budgeting: Develop a detailed budget outlining all anticipated expenses. Factor in both fixed and variable costs to understand your financial needs. Cash flow management: Timely invoicing, expense tracking, and contingency planning are key to maintaining smooth operations. Return on investment (ROI): Consider the long-term benefits of each expenditure in terms of client acquisition, service quality, and scalability. Scaling responsibly: Be strategic in hiring, investing in technology, and expanding services to match the growth of your digital marketing agency. Financial sustainability: Regularly review and adjust your financial strategy to align with your business goals and current market conditions. Alternative funding options When cash is in short supply, this does not mean your dream of starting your own digital marketing agency has to fizzle out. Let’s take a look at a few funding options that are available to you: Bootstrapping: Funding the business with personal savings or revenue generated by the agency. This offers independence but requires careful financial management. Loans: Securing loans from financial institutions to cover startup costs. It’s important to understand the terms involved and consider the impact on cash flow. Investors: Look for investors who believe in your business idea. This option often involves giving up some equity but can provide significant financial support. How do you get digital marketing clients? We all wish it was as easy as “building it and they will come,” but the reality is that finding digital marketing clients takes a bit of elbow grease and building up client trust and industry credibility. Here’s what you need to know as you search for leads: Strategies for acquiring digital marketing clients Network and build relationships Attend industry events, conferences, and networking meet-ups to connect with potential clients. Build genuine relationships by engaging in conversations, understanding their needs, and offering insights. Create a strong online presence Develop a professional website that highlights your services, portfolio, and client testimonials. Optimize your website for search engines (SEO) to enhance visibility when potential clients search for digital marketing services. Share valuable content, engage with industry influencers, and participate in relevant discussions on social media platforms. Invest in targeted paid advertising on platforms like Google Ads or social media to reach a broader audience. Showcase past work Develop a comprehensive portfolio showcasing successful campaigns, case studies, and measurable results. Highlighting your expertise through real-world examples builds credibility and attracts potential clients. Encourage satisfied clients to provide testimonials and share positive experiences. Leverage word-of-mouth marketing by asking for referrals from existing clients and professional connections. Offering value-added services Provide free resources such as webinars, whitepapers, or blog posts showcasing your industry knowledge. Demonstrate your commitment to client success by offering initial consultations or audits to identify potential areas of improvement. Partnerships and collaborations Explore partnerships with other businesses or white-label agencies to help you expand your offerings. Collaborate on joint ventures, webinars, or co-authored content to expand your reach. Ways to build trust and credibility Consistent branding Maintain a consistent and professional brand image across all platforms, stemming from your website all the way to social media profiles and everything in between. Transparent communication Nobody likes hidden fees, so clearly communicate your services, pricing, and expectations with potential clients. Consistent transparency builds trust and establishes a strong foundation for long-term partnerships. Client education Educate clients on the value of digital marketing and how your services will contribute to their business goals. Position yourself as a trusted advisor by offering unique insights and solutions directly tailored to their needs as a business. Biggest mistakes to avoid when starting an agency Starting a digital marketing agency requires careful planning, adaptability, and a commitment to continuous improvement. Avoiding these 10 common mistakes sets the foundation for long-term success and sustainable growth for your agency: 10 Common mistakes when starting a digital marketing agency 1. Overlooking market research Mistake: Starting without a clear understanding of market trends, competition, and client needs. Tip: Conduct thorough market research to identify opportunities, gaps, and potential challenges. 2. Setting unrealistic expectations Mistake: Overestimating early success and underestimating the time and effort required. Tip: Set realistic goals, understanding that success in digital marketing takes time and consistent effort. Consult mentors or peers for help setting these goals. 3. Poor financial management Mistake: Not performing holistic financial planning, leading to budget constraints and potential business instability. Tip: Develop a detailed budget, monitor expenses, and consider alternative funding options at your disposal. 4. Overcommitting without resources Mistake: Taking on too many clients or projects without adequate resources or a well-defined workflow. Tip: Start with a manageable workload, ensuring you can deliver high-quality results before scaling up. 5. Lacking a niche or specialization Mistake: Trying to serve a broad audience without a specific focus. Tip: When starting out, define a niche or specialization to set yourself apart and attract clients looking for expertise in a particular area. 6. Neglecting reputation management Mistake: Not leveraging your client reviews and testimonials to boost your online reputation. Tip: Prioritize customer satisfaction, seek feedback, and actively manage your agency’s online image to help improve your SEO and drive in more qualified leads. 7. Failure to adapt to industry changes Mistake: Not staying on top of emerging trends, technologies, and changes in consumer behavior. Tip: Subscribe to insightful newsletters, attend networking functions, and stay informed about industry developments to effectively upskill and adapt strategies to remain competitive. 8. Underestimating client communication Mistake: Poor communication with clients, leading to misunderstandings, dissatisfaction, or lost opportunities. Tip: Establish clear communication channels, set expectations early, and provide regular updates to clients. 9. Putting off continuous learning Mistake: Not setting aside time for upskilling and training can lead to outdated strategies that are less effective. Tip: Invest in ongoing learning through courses, webinars, and industry events to stay ahead of digital marketing trends. 10. Not prioritizing quality over quantity Mistake: Focusing on acquiring numerous clients at the expense of delivering high-quality work. Tip: Prioritize client satisfaction and quality outcomes, as happy clients often lead to referrals and long-term partnerships.