13 Steps to Start a Social Media Marketing Agency

Last updated on September 21st, 2024 at 10:28 am

 

Do you have online marketing skills and planning to start a social media marketing agency to offer service? This simple guide is here to help you get started in an easy step-by-step process.

Despite social media marketing skills, you must know the steps required to set up a formal business successfully from scratch.

Businesses in the United States spend billions of dollars on social media marketing to reach out to their target audience. This makes the industry worth investing in to scoop some profits from companies ready to spend to boost their businesses.

Compared to a 9 to 5-day job where you had to wait for a paycheck, as an entrepreneur here it is an hourly pay for more than $100 per hour which is quite some good money.

If you already have the skills, now all you need is a clearly defined startup process to help you achieve the best with your social media marketing agency.

What Is A Social Media Marketing Agency?

This is an agency that provides professional online marketing services through social media to businesses that want to reach out to their target audiences. You must have digital marketing skills to provide effective service to build business trust for opportunities.

Types of Social Media Marketing Agencies

There are different ways in which social media agencies brand themselves to acquire business from clients. Let’s look at some types of social media marketing agencies available in the industry.

• Strategic planning agency

This specializes in strategic planning to boost pages and the entire business. Effective social media marketing requires expert knowledge in strategic planning.

Some businesses outsource professionals to offer the service at a cost hence service providers take a share from companies.

• Content creation agency

Producing quality content to acquire target clients is a skill that most businesses outsource from online marketing agencies.

Professional target content that is natural and tailored to the services offered by the business is proven to reduce the cost per lead. Clients who find challenges in drafting engaging quality content outsource experts at a fee.

• Publishing agency

Another type of social media agency is one that specializes in offering services in publishing engaging content. Such content drives traffic to the business building a brand for conversions over time.

Publishing agencies also provide a defined approach to businesses regarding posting frequency and platforms to use for results.

• Community management agency

This type of agency offers services to companies finding challenges in tapping into community service provision. Businesses need online technical management skills to engage with the community for business opportunities.

• Complete social media management agency

This is an all-in-one agency with a team of members specializing in different areas of social media management for example strategic planning, content creation, publishing, and community management.

Pros and Cons of Starting a Social Media Marketing Agency

Like any other business, there are challenges and benefits to starting a social media agency. Let’s get into the pros and cons of the business.

Pros

• It is easy to start
• Profit margins are high
• The business is flexible since you can work from anywhere at any time.
• It is a scalable business

Cons

• It is a very competitive business
• Requires social media marketing skills to start
• Perseverance leads to success
• Takes time to grow the business

How to Start a Social Media Marketing Agency

If you are looking forward to starting a social media marketing agency for business, here is a detailed simple guide from the time of researching to marketing the business.

1. Research the Social Media Marketing Agency Business

First things first, research the industry to understand whether the business is worth investing your money for long-term goals.

As an entrepreneur, you should analyze the market potential, competitiveness, pricing, business location, distribution channels, and more for effective service delivery.

Gathering appropriate data in market research puts you at an advantage to offer targeted service with an edge compared to the competitors in business despite some challenges.

The best part, strategic market research helps to assess the strengths, weaknesses, opportunities, and threats in the industry firsthand.

2. Pick a Niche

Choosing a niche is the best way to start small to target a defined audience for business opportunities in social media marketing.

You don’t have to do many things at once when you are just starting, specialization builds trust with the target audience much faster.

A niche that connects with the target audience is appropriate for effectiveness and efficiency in delivering service compared to complete social media management.

As the business grows, after capturing your audience it is very easy to expand to diversify social media marketing opportunities with an edge.

3. Business Plan

To implement the social media agency goals with success, there must be a planned business approach to the industry. Here are some components of a business plan fit for the agency startup.

• Competitive analysis

This focuses on assessing the competitiveness of social media marketing in the industry. You know who your competitors are and how to manage effectively for results in the long term.

• Strategic market analysis

This involves analyzing the market for social media marketing services in the industry for business. This takes into consideration elements like market interests, behavior, location, and size.

• Company description

The goals, missions, visions, and hierarchy of authority in the agency are found under the company description. It helps people get to know about the business before directly making inquiries about service delivery.

• Organizational structure

This contains a list of board members and the hierarchy of authority in the social marketing agency. A formal legal structure streamlines the distribution of authority in the company for better performance.

• Financial plan

The social media marketing agency’s planned income and expenditure are worked under financial planning. Inflows and outflows are tracked for accounting purposes during the financial year.

Financial planning is among the most critical steps of a business plan. If you don’t plan, you’re planning to fail.

4. Get a Physical Location

Even though you can work from anywhere, some clients would want to find you in a defined physical location for consultations. Physical location will depend on the location of the target clients for social media marketing services offered.

Social media platforms and a business website for the social media marketing agency are online addresses. When the business has not yet built trust,  clients prefer physically walking into office premises for inquiries to online addresses to talk business.

Furthermore, take into account the cost of business set up in your state for example rent, taxes, and some other legal fees.

Though you want business offices for the agency, startup costs in that preferred location should be fair to save.

5. Business Registration

All businesses are required by the state to register with the business registrar before officially opening up. Registration is at a cost to the business paid to the authorities for recognition to lawfully start operations

This is where you have to take into consideration the preferred business structure for the social media marketing agency. Here is a list of business structures that an entrepreneur can choose from for registration purposes.

• Sole Proprietorship

Here a single entrepreneur has absolute ownership of the business with total liability to any proceedings. The entrepreneur is entitled to all the profits and losses of the business during the financial year.

• Partnership

Under the partnership business structure members share equal liability after registration. Therefore, during the calendar year members of the business share profits and losses in equal proportions.

• Limited Liability Company

After business registration members are entitled to tax and liability protection benefits, this is not the case with a partnership and a sole proprietorship business structure.

• Corporation

In this type of structure, formal business and legal proceedings are transacted in the name of the company since it’s a separate legal entity, and profits to the business are paid out to members as dividends.

After choosing a business structure, then consider an appropriate business name to be reserved by the registrar for identification from competitors.

6. Register For Taxes

Unless there are tax exemptions, tax registration is a mandatory requirement for businesses. The company will have to file returns to the government every financial year.

All businesses must abide by tax laws to make sure taxes are remitted in time to avoid interruptions from authorities.

Tax registration requirements are quite different according to business structure and location of business for example Social Security Number (SSN) and Employer Identification Number (EIN) serve the same purpose in different scenarios.

If you are an employer the Employer Identification Number (EIN) or sole business a Social Security Number (SSN) is a tax requirement.

A new business will have to select the right calendar month in which the calendar year ends for tax purposes. Here the company will be able to make tax submissions on time to the tax authorities.

Check with the tax authorities whether there are some tax benefits for new businesses to save. Since the business is just starting find ways to reduce costs from government authorities too.

7. Acquire a Bank Account

Financial dealings for the social media marketing agency should be transacted through the company account. It is an important tool for tracking income and expenditure for accountability purposes.

Talk to the service provider about account opening requirements depending on your business structure for professional assistance.

Some account opening requirements for new startups include an Employer Identification Number (EIN) or a Social Security Number (SSN) for a sole proprietorship business, Articles of Incorporation, Directors, Business address, and other legal documents as requested.

This is also a very important step in setting up a successful social media marketing agency to streamline business transactions and accountability.

8. Business Funding

As an entrepreneur, you need to mobilize capital to fund the business to keep operating. This can be obtained from different sources depending on the urgency for startup capital.

Here are the different ways to use to acquire funds for the social media marketing agency business.

• Personal savings

The business can be funded using personal savings to facilitate daily activities for effective service delivery. It saves an entrepreneur from using borrowed money that comes high with interest rates.

• Family members and friends

Some family members and friends are willing and ready to support you financially when you talk to them about the business idea. These people can offer loans with little to no interest or may be interested in becoming business partners.

• Crowdfunding

Crowdfunding platforms like Fundable and Wefunder provide access to funding opportunities from investors to entrepreneurs who want financial support.

• Government grants

Government platforms like grants.gov also offer funding opportunities to small businesses in almost every sector of the economy to boost businesses.

Despite the availability of funding opportunities, consider a mode of financing that is appropriate for the type of business structure and urgency for startup capital.

9. Process Licenses and Permits

In all states, licensing, and permit acquisition are part of business startup requirements no matter the business structure.

Consult with the authorities or a business expert about appropriate licensing and permit acquisition procedures for the business.

Every calendar year businesses must fulfill licensing terms according to the state and local licensing agencies’ stipulations in place.

The social media marketing service business is required to possess a general business license if at the city level, federal employer identification for identification with the Internal Revenue Service, a sales tax permit, and a certificate of occupancy.

Comply with licensing and permit acquisition requirements in the preferred state to avoid penalties and fines from the authorities.

For further inquiries about licensing and permit acquisitions use free online platforms like MyCorporation’s Business Licensing Package.

In some states, the process is quite complex because of differences in state regulations hence make thorough consultations to make sure that you comply with the law.

10. Recruit Staff

You need to build a team for the social media marketing agency to effectively provide service to clients. Consider recruiting relevant staff at a time for the business to share responsibilities at work.

You only need to recruit staff who are basic to the business to save money on an unproductive labor force since you are just starting. As the agency grows you can slowly fill some vacant positions which are demanding.

Use online platforms like Fiverr, Upwork, SimplyHired, and Flexjobs to outsource cheap labor for the business to save. These platforms will save you money on job adverts and also acquire quality cheap labor for the new startup.

11. Business Insurance

Another basic step in starting a social media marketing agency is insurance against unpredictable events that may cost the business.

Insurance will save the business in different ways for example coverage against injuries to staff, property damage, client lawsuits, and more.

Since the business has not yet started making money you must save on insurance costs, consider spending money on only basic insurance covers for the new business. Here are some insurance covers fit for a social media marketing agency business.

• Business owner’s policy

The insurance package covers general liability and commercial property. It is an all-in-one discounted policy compared to purchasing separate covers.

• Professional liability insurance

This package is also known as the technology errors and omission insurance package. It covers lawsuits and some errors that may cost the business during service delivery.

• Fidelity bonds

The insurance package protects the business when its employee steals something from the client, It can also be called dishonesty bond insurance.

• Cyber liability insurance

Here the social media marketing agency is covered against cyber-attacks or data breaches and client lawsuits during the policy period.

• General liability insurance

This covers the business against liabilities likely to occur in contractual work and commercial property leases.

12. Online Presence

A professional social media marketing agency should create an online presence for the business. Sure, you need a business website and social media presence to market the business.

Through online platforms, the business can easily connect with stakeholders like clients, suppliers, and other business partners.

Clients will get to know about the business without matching to office premises to make inquiries for business purposes.

Some qualities of a successful online presence are; targeting a specific audience, having people to manage the platform, balancing demand and supply, scalability, and more.

When you want professional assistance at a cost to design a business website or social media platforms, consult with online platforms like Fiverr, Upwork, and Flexjobs

You need a professional social media marketing agency website and social media platforms such as Facebook, Instagram, Twitter, and TikTok to be used as online addresses.

13. Business Marketing

This is also among the most important steps in starting a successful social media marketing agency to spread business awareness. For effectiveness in marketing, there are proven marketing strategies to use.

Let’s briefly look at the 7Ps of a marketing mix.

• Product or Service

The services provided should meet the expectations of the clients in terms of design, quality, time, packaging, and more to attain value for money.

• Price

The price for the services offered should be competitive in the industry to have an edge compared to your competitors. Some clients are price conscious and hence prefer cheap quality service, but make sure to cover business costs.

• Promotion

This can be done in different ways to build a brand to boost sales for the business for example offering free services and discounting offers to clients. Promotion as a form of marketing can also be done with traditional strategies like posters and banners or using online platforms.

• Place

The business should be strategically located to ease accessibility for effective service delivery. Business location is key to boosting business opportunities.

• People

You need to share responsibilities in business for effectiveness and efficiency in service delivery. This can be achieved by recruiting staff with the required skills to offer service during operations.

• Packaging

Social media marketing services should also be packaged in a way that is informative, unique, and quality. Not only products but services too must be appropriately packaged to fit the needs of clients.

• Process

For effectiveness and efficiency, as an entrepreneur, you need a strategy to use in delivering services. This gives you a systematic approach to business with clients.

Besides, here are some effective strategies the social media marketing agency can use in marketing after working on the 7Ps of the marketing mix.

• Carry out thorough market research for the social media marketing agency to know the audience for the service offered. Also, put into consideration the competitors in the same business to take advantage of their weaknesses with an edge.
• Consider profiling the target audience in relation to demand according to consumer behavior, location, demographics, and other relevant factors.
• Have a unique selling proposition for customers to get convinced to prefer your services and not the competitors. This can be in the form of pricing, quality, convenience, after-sales services, and more.
• Branding is what the audience perceives about the services offered and the business in general. Here, choosing a niche is very important for effective branding.
• Marketing channels are also a very important aspect of strategic marketing of the social media marketing agency. Some appropriate channels for the agency include social media, blogs, a business website, and networking.
• Budgeting and mobilizing funds to finance business marketing operations like social media marketing, search engine optimization services, website designing, promotions, and advertisements.

FAQs – How to Start a Social Media Marketing Agency

1. How much money can a social media marketing agency earn per month?

The business can charge more than $4000 per month from a single client offering full-package social media management services.

2. How long does it take to start making profits from the social media marketing agency?

Like any other business, it depends on your level of commitment and persistence to put in the work using best practices to produce results. Normally within 2-3 years, you will start realizing tremendous growth with serious profits.

3. How much money do I need to start a profitable social media marketing agency?

Taking into consideration startup costs like a computer, business registration, licensing and permit acquisition costs, marketing, and more. Starting a social media marketing agency on a small scale on average would cost about $2500 in the United States.