| Mar 25, 2024 | | 8 min read

The Complete Agency Guide on How to Make Money in Digital Marketing


Digital marketing is here to stay. While traditional marketing strategies still have their place, there’s no denying that businesses are allocating more of their marketing spend to digital every year.

Break down your formula for B2B profitability and calculate your earnings selling the Vendasta 'Customer Journey Pro' digital marketing bundle today.

The increased demand for digital tools and services places a strain and small and medium-sized businesses (SMBs), which often lack the in-house expertise and resources available to their larger counterparts. Without the ability to manage increasingly complex campaigns internally, SMBs often turn to digital agencies or marketing consultancy businesses to stay on top of their marketing tasks.

For digital agencies, this is great news: if you position yourself appropriately, there’s no shortage of ways to make money with digital marketing. In this blog post, we’ll look into some realistic revenue figures, challenges to be aware of when making money through digital marketing, and ways to mitigate your expenses. We’ll also cover 10 ways to start earning from digital marketing today.

How much money can you make with digital marketing?

How much money you make through digital marketing depends on several key variables:

  • Agency skills: The more skills your team can demonstrate, the more value you’ll represent to SMB clients.
  • Experience: If you’re a seasoned digital marketer or you have experienced pros on your team, you’ll typically be able to command higher fees. This is especially true if you can demonstrate a record of successful campaigns.
  • Business structure: The way your agency is organized can impact your revenue. For example, delivering all services in-house will limit your ability to scale your revenues compared to hiring a white-label agency to support you.
  • Niche or target industry: The industry in which your clients operate impacts their digital marketing budgets.
  • Solutions bundle: The more solutions you offer, the more you’ll be able to potentially earn.

Some one-person digital marketing agencies earn around $100K annually, while others scale into the millions. Revenue isn’t the only factor to consider: expenses can differ dramatically across agencies, impacting the bottom line.

Success can take many forms. For Matt Ainsworth of Giving Tree Media, it involved starting with a focus on SEO services and eventually expanding to add website development, digital advertising, and social media management to his suite of solutions. This led him to scaling his business to $250k in 14 months as a one-person agency (Vendasta).

For SocialJack Media’s Jack Pires, it means growing a versatile team of 13 to manage over $2 million in annual revenues, delivering a “Swiss army knife” of solutions to local business clients (Vendasta). Hear more from Jack in this inspiring episode of the Conquer Local Podcast:

Challenges in making money with digital marketing - 250

Both Matt Ainsworth and Jack Pires will be the first to admit, it’s not a walk in the mark to make money through digital marketing. Every agency owner faces challenges. Knowing what to expect as a digital agency startup can help you position your company for success. Let’s take a look at some of the most common challenges when it comes to making money with digital marketing.

Fierce competition

The number of digital agencies is growing every year (Promethean Research). While there is plenty of demand for digital services, it’s important to be aware that the marketing landscape can be quite saturated. Standing out requires a rock-solid understanding of your niche and high-quality, personalized service. Without a unique value proposition (UVP), it can be difficult to persuade prospects to switch to your agency.

Evolving trends

While the overarching principles of digital marketing don’t change dramatically from one year to the next, trends do. Similarly, algorithm changes can force the need to change your marketing strategy overnight. Digital marketing is dynamic, and even when business is going well, it’s important to stay informed about industry news, attend webinars, and invest in ongoing education to adapt swiftly to changing trends.

Need for a strong personal or agency brand

A strong personal brand or agency brand can be a game-changer. Establishing yourself as a thought leader in your niche by creating consistent, valuable content can dramatically improve the perception of your agency. If you neglect this when starting your digital agency, it can be difficult to gain the trust of new clients.

Establishing credibility

Digital marketing companies must be seen as credible and trustworthy to win client work. Testimonials, case studies, and portfolio entries can establish trust, but a common challenge faced by startups with no experience is getting those first few critical clients.

Strategies for success

Don’t let these challenges discourage you: instead, think about how you can reduce their impact on your lead generation efforts so you can hit the ground running. Keep these strategies in mind:

  • Niche specialization: Specializing in a nice can help you gain valuable expertise and set your agency apart. You don’t necessarily have to limit yourself to one industry, but your clients should share characteristics such as size, location, or broad business sector.
  • Networking: Word of mouth is extremely valuable when it comes to earning money through digital marketing. Attend conferences, engage in online forums, collaborate with other professionals, and be present in your community.
  • Adaptability: If you can embrace the fact that change is constant, you’re already one step ahead of the game. Make time weekly to keep up with trends in the world of digital marketing.
  • Continuous education: Since technology is always evolving, staying current with tools and strategies is important. You don’t necessarily have to invest in formal education, but make sure to work in regular time to learn.

10 ways to make money in digital marketing

Now that you’re armed with know-how about the difficult side of making money through digital marketing, we can focus on the good part: solutions you can start offering today to start making money for your agency. Here are 10 of the most in-demand ways to earn money from digital marketing.

1. Affiliate marketing

With affiliate marketing, you don’t even have to deliver a service to start making money. You can start earning commissions by promoting the products or services of other companies as an affiliate partner. Just make sure to stick to partnerships that complement and enhance your agency business rather than competing with it.

2. Social media marketing

As every SMB discovers eventually, managing social media accounts is hugely time-consuming. Often, small businesses lack the time and resources to handle this task in-house. However, being inactive on social media isn’t an option today. That’s why managing accounts on their behalf, creating content, or running social media ad campaigns are all valuable services you can offer to do online marketing and earn money.

3. Content creation

SMBs require a wide range of content types between their social media accounts, websites, advertising, and other marketing collateral. Agencies can earn money with digital marketing by providing blogs, vlogs, images, videos, podcasts, graphics, and any other content required by the SMB client.

4. Search engine optimization (SEO)

SEO services are required by all businesses, but local businesses in particular can benefit from this visibility-boosting marketing strategy.

5. Email marketing

Email campaigns are a deceptively powerful digital marketing strategy, delivering better ROI than just about every other technique available thanks to their low cost. Agencies can start earning from digital marketing by setting their clients up with conversion-maximizing automated email flows.

6. Digital advertising

Most SMBs have very limited knowledge of digital advertising, making this a high-value service for agencies to provide. Pair your campaign management with a white-label PPC advertising dashboard to empower SMBs to better understand their ad campaign performance.

7. Ecommerce

By selling websites with ecommerce functionality you can work with product-based businesses and even support service-based businesses in adding an extra revenue stream by selling guides, consultation sessions, or other digital products that make sense for their niche.

8. Online consulting

Sometimes SMBs just need a bit of guidance before trying their hand at DIY digital marketing. By selling online consulting, you can establish your agency as a trusted source of valuable information. As your consulting clients grow, they’re likely to require further marketing support, making them hot candidates for other agency services.

9. Online courses and training

Elearning has transformed education and career training, and digital marketing is no exception. You can make money with digital marketing education modules and courses, further establishing yourself as an important voice in your niche.

10. Freelancing

If you’re an aspiring digital marketing owner, you don’t necessarily have to wait until you’ve established your agency to start selling services. Start selling any of the services above as a freelancer today, and migrate those clients to your agency once you’re set up.

How to mitigate digital marketing expenses

If you want to earn money through digital marketing, it’s important to avoid your profits getting swallowed by expenses. Use these tips to reduce expenses so you can keep more of your agency’s revenues:

  • Set clear goals and well-defined strategies: this will help you avoid overspending on non-essential activities.
  • Focus on cost-effective digital marketing strategies: social media advertising, SEO, and email marketing can all deliver impressive results for clients without much overhead.
  • Use analytics tools: Track and measure the performance of your digital marketing activities, and use data to continually improve your outcomes.

About the Author

Lawrence Dy is the SEO Strategy Manager at Vendasta. His career spans from starting as a Jr. Copywriter in the automotive industry to becoming a Senior Editorial Content Manager in various digital marketing niches. Outside of work, Lawrence moonlights as a music producer/beatmaker and spends time with friends and family.

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