How Much Does an Online Marketing Firm Cost?

In today’s digital age, almost every type of business can be operated remotely via the Internet, including marketing and advertising firms. Thanks to software platforms like HubSpot and Marketo that make operating an online marketing business significantly easier and more cost-efficient. As a result, more and more entrepreneurs are choosing to pursue this form of business and there is a growing demand for skilled, experienced marketers who can help businesses grow their online presence, gain more traffic, and convert that traffic into paying customers.

But what exactly is the cost of running an online marketing business? How much does it cost to hire marketing professionals and how much does it cost to operate a digital marketing agency?

The good news is the cost of operating an online marketing firm is relatively low and there are a variety of ways to lower your costs, like becoming a virtual assistant or a freelance copywriter. 

Cost To Hire A Freelancer

If you’re looking to start an online marketing business, the first and most significant cost you’ll encounter is finding and paying for talented, experienced freelance writers and marketers who can help you build your audience.

Hiring freelance writers and marketers to help you build your audience and grow your business is a common strategy among the most successful digital marketing agencies. By utilizing a variety of digital marketing tactics, from SEO and PPC to content marketing and influencer marketing, these agencies are able to consistently and successfully market brands online.

The reason why so many successful businesses choose to outsource their digital marketing is because it’s so expensive to hire highly-skilled marketers who can help you grow your business. Although there are skilled freelancers who charge significantly less than competitive wages, the costs still add up quickly. 

If you’re looking to create a digital marketing agency, or if you’re just looking to hire talented freelance writers and marketers, you’ll need to consider a few things before making a hiring decision. 

The Essential Requisites For Any Freelancer

To run an effective digital marketing agency, you will need to consider investing in the following essentials:

  • A reliable network (wired or wireless)
  • A computer (laptop or desktop)
  • A desk
  • Printer
  • Scanner
  • Outsource the little things
  • Staff meetings
  • Office equipment
  • Travel expenses
  • Health insurance
  • Liability insurance
  • Equipment breakdown insurance
  • Staff training
  • Office space
  • Technology costs (servers, software, etc.)

You’ll also need to set aside a small budget to cover the following expenses:

  • Marketing and advertising costs (PPC, SEO, and other types of paid advertising)
  • Cost-per-acquisition (CPA) for online stores and other affiliate programs (Cost per click or lead)
  • Marketing software (like HubSpot or Marketo)
  • Design costs
  • Hiring and paying freelancers
  • Travel costs (for yourself and your team)
  • Office supplies (like paper, coffee, etc.)
  • Technology costs (for your team)
  • Health insurance
  • Liability insurance
  • Equipment breakdown insurance
  • Staff training
  • Office equipment
  • Travel expenses (for clients and yourself)
  • Health insurance
  • Liability insurance
  • Equipment breakdown insurance

Once you have these essentials set aside, it’s time to consider how you’re going to pay for all of this. 

Digital Marketing Agency: A Breakdown Of Costs

To give you a better idea of what kind of costs an online marketing agency entails, let’s examine the breakdown of expenses for a medium sized business, which I’d consider to be a digital marketing agency that handles website creation, inbound marketing, social media marketing, PPC, SEO, and email marketing for clients. 

The good news is the costs associated with running a digital marketing agency are relatively low and a lot of these expenses can be covered by the money you’ll save by becoming a freelance copywriter or a virtual assistant.

As you can see from the above graphic, marketing and advertising is the largest expense, accounting for approximately 28% of the total running costs. This is followed by technology (16%), office (16%), and travel (13%). 

The table below breaks down these expenses further: