The definitive guide to understand social media marketing costs

Small businesses typically pay an agency between $300 and $1,000 per month in social media marketing costs (Digital Marketers World). This range gives you an idea of your potential income when offering social media packages to small business clients, but you’ll need to do some number-crunching to ensure your pricing covers your expenses and conveys the value of your services to customers.

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Follow along as we explore the costs of planning, implementing, and managing social strategies. We’ll look at the cost variations you can expect as you tailor strategies to your clients’ needs and what to consider in your social media marketing agency pricing models as you deliver top-notch services to your clients.

Understanding social media marketing costs

Social media usage is trending upwards—the average internet user now spends 2.45 hours a day on networking platforms (Statista). It’s no surprise that 7 out of 10 small businesses are marketing on these channels to help customers learn about their brand and products online (Hootsuite).

The challenge, however, is to quantify the costs involved in enhancing your client’s online presence. This requires a clear understanding of the time, resources, and tools required and the value you’re delivering. When you can set social media marketing rates that strike a balance between your profitability and a customer’s needs, you’re improving the chances that they sign up for your packages and are satisfied with the worth of your work.

Factors influencing social media marketing pricing plans

SMBs require different levels of service based on their goals, budget, and industry niche. We’ll delve into this in more detail later, but generally, your fees depend on:

  • The client’s budget
  • How developed their social presence is
  • How many platforms they want a presence on
  • The aggressiveness of their strategy
  • The complexity of the campaign
  • Their in-house expertise and the services they want to outsource

Cost considerations for small business clients

First, let’s look at how much your clients are going to spend, as there’s no one-size-fits-all approach for social media manager packages and pricing.

1. Budget considerations

On average, businesses spend about 17% of their marketing budgets on social media, with research suggesting this will increase to more than 26% by 2028 (CMO Survey). In an ideal world, businesses can easily allocate this spending but the reality is different, especially for SMBs.

While you need to invest money to raise your online profile and capture audience attention, small businesses may have a restrictive cash flow that makes it difficult to allocate dollars for marketing. They likely also have multiple channels competing for their budget. Businesses will prioritize their social marketing spend based on the importance of the channel to their goals and the return or value they expect to see.

2. Desired level of social media marketing services

A company’s social media management costs are tied directly to the aggressiveness of their campaign. A restaurant that wants to maintain visibility may only require a few posts a week with a still image of their menu items, while a more sophisticated campaign designed to increase followers may involve giveaways and promoted posts.

Your agency’s costs will depend on the frequency of posting, the amount of time spent creating original content, and time required to respond to users and engage online. You may also need to invest more to launch a campaign if a social presence isn’t already in place.

3. Business goals and objectives

The main reasons businesses use social media marketing are (CMO Survey):

  • Raising brand awareness
  • Running promotions (contests, promo codes)
  • Acquiring new customers
  • Introducing new products and services
  • Customer retention


A company’s social media marketing cost per month will increase based on their goals and the tactics chosen to achieve them. A company interested in relationship building and engagement will spend more on a strategy than one that’s using their account to occasionally post about a product or simply give customers another outlet for customer service.

4. Platform selection

Your marketing budget needs to consider the platforms being targeted and the type of content you need to create to engage audiences. For example, a business targeting Gen Z through TikTok or Instagram will need a larger budget for visual content creation—especially videos—than a company marketing with thought leadership articles to lawyers through LinkedIn.

We’ll look at cost variations for digital ad spend a little later in this guide. The cost clients pay to networking platforms to display ads in user feeds is on top of your agency fees for managing, producing, and tracking ad content.

Social media services pricing components explained

Once you know what your client wants to accomplish, dig into the nitty-gritty of the cost of the campaign. These expenses fall into four general areas: strategy, content creation, advertising, and analytics.

Strategy and planning costs

Powerful marketing strategies are targeted to a client’s audience—after all, there’s no benefit to posting content that doesn’t interest your customer. That means you need to dedicate time to developing an effective plan.

Your social media agency pricing should allow for time to study a client’s niche, target demographic, company voice and branding, and overall goals. Consider using a social media onboarding questionnaire to easily gather key information so it’s readily accessible to your team. You’ll need a content strategist to select appropriate tactics and shape messaging to showcase your client’s brand.

Content creation and management costs

Once a plan is in place, you’ll need to develop compelling content that persuades a user to read a post, comment on it, or click through to a landing page, website, or store. Budget for an account manager who schedules and oversees the rollout of posts across platforms and coordinates the different elements of a campaign.

You also need to pay for the creative team of writers, designers, and producers to photograph subjects, create graphics, shoot and edit videos, and deliver smart and sharply written copy. Some agencies find that using a white-label social media service simplifies the sometimes arduous process of content creation.

In addition to cultivating a customer base through organic social growth strategies, most businesses will target a specific demographic using ads on Facebook, Instagram, TikTok, and Twitter to quickly generate leads and conversions.

Costs vary by platform and impressions, clicks, or views. When advertising on these channels, consider the format of ad and the creatives required. A footwear company will pay less for a still image of a pair of shoes than a video ad showing an athlete running and jumping in their sneakers.

Monitoring and analytics costs

Successful campaigns require more than execution of strategy. For ongoing success, you need to leverage the insight provided by analytics tools to:

  • Determine the best performing posts and craft more effective campaigns
  • Find the most successful avenues for reaching audiences to focus resources
  • Determine return on investment to better spend dollars


You’ll need to choose metrics and develop a plan to monitor your client’s online strategy. Individual platforms have their own analytics but when you’re managing multiple accounts, it’s easier to use a social media management tool to access information from one dashboard and save you from hopping between accounts. Be sure to allow time to analyze reports and track performance so that the information can be incorporated into future planning.

Tools and software costs

A successful strategy involves many components from planning to execution. Technology helps you keep track of the pieces and makes it easier to compose posts, design graphics, schedule posts, run analytics, and monitor performance.

Depending on the services you’re providing to clients and what they decide to take on themselves, your social marketing management costs include purchasing, licensing, or subscribing to tools that make your work easier. Typically, you’ll benefit from economies of scale if you can use a tool across client accounts. Software that’s exclusive to a single client is billed directly to them.

Social media management services pricing models

Agencies have several options for social media marketing management pricing. You can also use different rate structures to suit your clients, such as charging a new client hourly to create their social accounts and moving to a monthly retainer once you’ve earned their trust.

Hourly rates

The most simple and transparent pricing structure is an hourly rate. Track the time spent managing a client’s account and invoice for actual hours worked at the end of each billing period.

Project-based pricing

With project-based pricing, clients pay a set price for a predefined scope of work. This fee is determined by estimating your costs and adding in a profit.

A project fee remains the same whether the work is completed in more or less time than you anticipated. You can boost your profitability by using tools to improve efficiency and streamline your work.

Monthly retainers

A retainer is a set fee paid in advance and is ideal for an ongoing working relationship. Usually, an agency is paid monthly for work as needed, which may include creating content and responding to user comments and messages as part of a brand’s reputation management on social media.

Agencies may offer a retainer model on a month-to-month basis or require a minimum commitment. This model offers agencies the most stability as they can predict their income.

Performance-based pricing

With a performance-based model, an agency is paid based on the results generated from their marketing efforts. Performance may be calculated based on lead generation or conversions, and the perceived value of those actions.

This pricing model requires accurate tracking and determination of which channels are driving results. It’s common to combine a monthly retainer with performance-based pricing.

Factors impacting cost variations

Now that you have an idea of what goes into social media marketing companies pricing, let’s look at factors influencing the actual cost of a campaign.

Industry and competition

An effective digital strategy differentiates you in a crowded online landscape, which means your success also depends on what your competition is doing. If your client is in a highly competitive niche, it takes a high level of effort and creativity to gain attention and a share of voice.

Some industries are also more expensive when it comes to social advertising. For example, the average cost per click is $0.82 for residential real estate agents, $1.07 for opticians, $1.92 for plumbers, $2.16 for personal fitness trainers, and $2.44 for dentists (Wordstream).

Target audience size and reach

Your paid advertising costs increase with audience reach, so you should narrow your audience size based on age, education, gender, location, interests, and activities. Businesses with multiple audience segments may generate better results when they tailor their messages, but this increases the cost of content creation.

Complexity of campaigns and content

Marketing costs are directly tied to your goals and tactics, so you’ll need to build project-specific budgets for each campaign. The more elements you add to a strategy, the more costs you’ll incur.

A slick promotional video requiring action shots, music, and editing will run a higher tab than one featuring a single person unboxing a new product. If you’re launching a campaign around user-generated content, you’ll need to consistently respond to followers and engage those who are participating.

Geographic targeting and audience demographics

When you narrow your audience to a specific demographic or location of a customer, you’re paying to display your ad to a very niche audience. This can be cost-effective as you’re not wasting impressions or clicks on those that wouldn’t be interested in your product or services.

However, sought-after demographics are more costly to reach. Most networking platforms run on an auction system, so you’ll have to bid more to increase the likelihood that your ad will display to your coveted audience segment.

Additional considerations for geotargeting

Businesses serving a community, such as restaurants and retail shops, benefit from targeting customers in their area. A hotel offering weekend staycations during the off-season or a restaurant promoting new menu items can use geotargeting to more efficiently reach customers.

A business with multiple locations may run accounts for each location. This enables an agency to provide consistent messaging across the brand, as well as customize ads locally or promote in-store specials. You can tailor ads when geotargeting to improve the chance of conversion but this adds to your production costs. For example, If you’re aiming to reach audiences in several countries, you may need to pay to customize ads by language.

Other factors impacting social media marketing services pricing

Value-added services and pricing implications

The more services you offer your clients, the more valuable you become to them. This adds income streams to your business’s bottom line, and simplifies things for clients who can entrust additional digital needs to an agency that already understands their business model.

When selling additional relevant services to your clients, you can improve customer retention and boost your profitability over the long term. By helping to fill a need, you deepen your relationship and further client trust and loyalty. According to data from our churn study, more than 60% of clients that have not been upsold leave a business within two years. On average, selling two products to a business can increase retention by 20%, while selling four products can increase retention by 80%.

Examples of value-added services

Some businesses may start off slowly on networking sites and add more marketing services as they get comfortable. For example, a client who hires you to publish three posts a week may later turn to your agency for social media reputation management or to run some sponsored ads.

But you can also expand the category of digital services you offer. You might move naturally from ads on Facebook to running pay-per-click search engine marketing ads on Google. You could help clients attract more website traffic by providing SEO services or improve user experience with a website redesign. If you don’t have the in-house expertise for additional offerings, consider using a white-label management service to ensure superior and ongoing customer experience.

Considerations when adding services

Make sure that you’re solving a problem when cross-selling to your clients. Customers who feel like you’re only interested in them as a revenue source may decide to find an agency they feel puts their business needs at the forefront.

Consider bundling value-added services into packages or offering discounts to entice clients.

Scaling social media marketing efforts (up or down)

While consistent social marketing is needed to maintain brand awareness and engagement, there are times when businesses change course based on needs.

Companies often shift their social presence into high gear when unveiling new products or services or expanding locations. Many businesses scale up at certain times of the year, whether it’s a florist getting ready for Mother’s Day, a kids’ clothing store promoting back-to-school scales, or an electronics retailer taking advantage of Black Friday. In some cases, companies cut back on marketing because they decide to move some work in-house or reduce their budgets in hard times. Your marketing costs will fluctuate with these changes.

Potential cost savings through long-term partnerships

As you grow your agency, you may develop relationships with service providers that deliver complementary services to a similar target audience. When you find a trusted partner, you can benefit from a formal partnership. If you regularly send work to a content provider or designer, for example, you may be able to tap into a discounted rate that reduces the average cost of your social media marketing.

Frequently asked questions

How do social media marketing costs vary by platform?

The pricing for promoted or sponsored posts depends on factors such as target audience, time of day or year, ad format, and where an ad appears (for example, whether it is placed in a user’s Instagram feed or stories). You’ll find an average cost per click of $0.40-$0.72 on Instagram and $1.72 on Facebook. On YouTube, the average cost per view is $0.01-$0.03 (Digital Marketers World) and on Twitter, the average cost per action is $0.50-$3.00 (AdEspresso). Some channels have minimum bids, but you can also set a maximum or daily budget to better manage your costs.

Are there any hidden costs associated with social media marketing?

Agencies sometimes underestimate the human resources needed to execute top-notch marketing strategies, including account managers to liaise with clients, project managers to oversee campaigns, and strategists, writers, designers, and editors to produce quality creative assets. You may also need additional resources to interact with users and respond to online comments as audience reach grows. As well, marketers spend up to 60% of their time on administrative tasks (Simple). These inefficiencies can eat away at profits as you scale, so learn to effectively manage social media, streamline workflows, automate tasks, and keep clients apprised of your performance so you continue to build trust and customer satisfaction.

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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