How to start a digital marketing agency from scratch

Picture this: you move from that dead-end job at an ill-fitting firm to being a successful business owner raking in good money by running an innovative digital marketing company on a 4-day work week. Well, it’s possible! How? Some might say it all starts with ambition. But, of course, it’s a lot more complex than that.

By taking the plunge and launching your own digital marketing company, you can reach new career heights whilst being your own boss. From establishing a growing client base to slowly building your own team, you can truly be in control of your work without it taking over your life.

So, how do you get there? This by no means exhaustive guide will explore how to start a digital marketing agency from the bottom up, from refining your initial idea to finding a client base. Read on for some valuable pearls of digital marketing wisdom!

Defining a digital marketing agency

There are many companies operating in the online space, but the digital marketing agency is a particularly profitable model. After all, there will never be a deficit of brands looking to stay visible online.

According to recent stats, 81% of consumers conduct research prior to purchase, and it’s a digital marketing agency’s job to help businesses develop an online presence and guide prospective customers down their sales pipeline to a purchase decision.

What types of digital marketing agencies exist?

One of the great things about embarking on this entrepreneurial journey is that you have the freedom to structure your digital marketing agency however you like. Here are the most common types.

• Full service: All or most digital marketing services are offered to clients, with a full team of specialists covering web development, SEO, PPC, social media management and everything in between.
• Single channel: Specializing in one specific digital marketing niche, and can provide bespoke, high-quality services within this chosen channel.
• Multi-channel: Somewhere between full-service and single-channel agencies, with an offering of a handful of often complementary marketing channels.
• Single industry: Exploiting a wealth of industry contacts or niche experience in a particular sector can prove to be profitable for some agencies, and it can be a powerful USP.

5 questions to ask yourself before embarking on your entrepreneurial journey

Before getting into the nitty-gritty of how to start a digital marketing agency, it’s a good idea to check whether your heart’s really in it and whether you consider yourself prepared for all the hard graft needed to get a new business up and running. Look inwardly and really mull over these questions:

1. Do you have the skills and expertise?
2. Are you open to learning on the job?
3. What kind of support do you have to start your business?
4. Are you in it for the long haul?
5. What are you seeking to achieve?

Got the answers? Then hopefully you will be in a better place to get started.

How to start a digital marketing agency in 2025

1. Get in the right mindset

The startup world is full of risks. In fact, you can’t really launch a new business without encountering some. Thus, it’s a good idea to explore them thoroughly and reframe your thinking. This means taking on a growth mindset. Instead of viewing challenges as something you should avoid at all costs and criticism as a negative thing, take them on the chin. Doing so will make you so much more resilient and you can turn hurdles into important learning moments.

2. Allow market research to guide you

Before diving headfirst into the digital marketing world, you need to do your homework. Learn as much as possible about the industry landscape, what customers expect and are looking for, current trends and what the big players are doing. With this knowledge at hand, you can find ways to differentiate yourself from other companies and develop your offering with a comprehensive SWOT analysis.

3. Develop a clear business plan

With the main research done, you can begin to go granular and create your business plan. This key document is your road map to success and should encompass the following:

• Audience research: Develop detailed buyer personas of your ideal clients.
• Competitor analysis: Scope out and review the competition – what are they doing well and what could you do better?
• Mission and objectives: Solidify your brand ethos, short-term and long-term SMART objectives.
• Business structure: Choose between the models we mentioned earlier and go into the details.
• Financial planning: Draw up a realistic budget, note down how you intend to fund your new business and include projections of expected cash flow.

4. Select & refine your offering/services

By this point you will know your USP and what you want to achieve, so now it’s time to refine your services. This means getting to a certain level of expertise, which might require additional training and practice.

In the early days of business, this will be your primary concern as without a good product capability you won’t gain sufficient customer acceptance and, in turn, achieve viability.

If you specialise, you’re more likely to get more of the type of work you want, and plenty of white-label work from other agencies. This is a really good source of income before you build your own client portfolio.

5. Set your pricing model

The pricing model you opt for is up to you, but do consider which is most suitable for your business. It’s all about striking a balance between being attractive to prospective clients and turning a healthy profit. Is there a service you’d be happy to be a loss leader? What about time-critical discounts for new clients?

While you ponder on these possibilities, check out the main pricing options:

• Retainer: Ideal for encouraging long-term clients and providing some level of predictability.
• Hourly: Ideal for the simple and transparent charging of clients, but does mean that if you work faster, you’ll earn less.
• Commission: Ideal for projects with clear goals and timeframes.
• Fixed Fee: Ideal for those able to accurately estimate the total number of hours required for different projects and can offer clear, time-bound deliverables.

6. Think about tax planning

Although not the most glamorous part of setting up a digital marketing agency, it has to be done. Make sure you’re familiar with all the legal stuff tied to your business from opening a business bank account and getting your head around taxation to the important decision of whether you want to operate as a sole trader, partnership or limited company. There’s also the matter of registering your new business and sorting out insurance and accounts.

7. Sort out your branding

The long and short of it is really that visually unappealing brands will struggle to gain custom. The savvy entrepreneur will ensure that they’ve invested the time and energy into thoroughly translating what their business is all about into the visuals, logo and tone of voice they’re going to use going forward. It needs to look professional, be unique and appeal to the target customer base.

8. Source the right tools / get tech savvy

One thing you’ll discover quickly when learning how to start a digital marketing agency is that there are so many tools involved. By investing in the right ones, you can find ways to streamline your workflows and cut costs in your business.

These resources include:

• SEO tools for keyword research, website auditing and link-building
• Project management tools such as
• Lead/sales management CMSs
• Communication tools for messaging and video calling
• Design software for content creation
• Email marketing and social media management tools
• Small business security solutions
• Any miscellaneous subscriptions

9. Generate leads to grow your portfolio

Lead generation is one of the key strategies that all young entrepreneurs should know; after all, what’s a good business without customers? Lead generation is all about turning prospects into interested potential customers. To do this well, try running a multi-pronged inbound marketing campaign across various channels, including both paid and organic search for maximum reach.

10. Scale your team

Something you should think about early on to put the right structures in place is small business growth. It can’t hurt to develop a scalable business model from the get-go, so you can expand in a sustainable way.

Perhaps you could start with freelancers? The abundance of freelance professionals available allows small businesses flexibility, without long-term overheads and access to their specialist knowledge.

When you get to the stage of hiring employees, look towards individuals who share your values and have hidden talents you can nurture. At this milestone, you should also begin to think about how you intend to delegate work later on, so you can share responsibilities and allow the company to grow.

Closing thoughts: Do you have it in you?

Hopefully learning more about the long process of how to start a digital marketing agency hasn’t put you off the endeavor. While it takes grit and determination, it’s equally rewarding. Be prepared for a rollercoaster of a journey and enjoy the ride. Good luck!

WebHummel are SEO experts but provide a suite of bespoke digital marketing services. Follow @Web_Hummel to learn how you too can ‘bee’ found online.