Marketing Agency

How Profitable Is A Marketing Agency? (Updated for 2024)

Pat Walls

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Updated: October 8th, 2024

How Profitable Is A Marketing Agency? (Updated for 2024)

So you want to start a marketing agency?

And the first question that came to your mind was, “well, are marketing agencies actually profitable?”

Especially considering:

You could start a marketing agency with as low as $1
Based on our data, marketing agencies generate an average of $3.14M per year
You could see gross margins as high as 80% with marketing agencies

There’s money to be made. Don’t worry.

But, I don't want to spoil it all. Below we’ll cover everything you need to know when it comes to the profitability of a marketing agency.

Let’s dive in!

Is a marketing agency profitable?

Yes, a marketing agency is generally a profitable business. However, you still need to consider several factors since these things always impact the overall outcome.

For instance, since average revenue is $3.14M per year with an estimated gross margin of 23%, you could expect to recover your investment within 11 months or even less.

But of course, it all comes down to how much you earn compared to the potential revenues of your marketing agency.

To determine whether your business is profitable, you should earn more than your expenses in the beginning months. However, while you're in your first month, it can be challenging to know what to expect.

Therefore, you should maintain a record of your monthly expenses and income to determine whether you're meeting your goals. By doing this step, you can see how your marketing agency is doing and if any changes or adjustments need to be made to enhance or maintain your efforts.

Is a marketing agency worth it?

If you’re wondering if a marketing agency is worth it, the answer is a big YES. With marketing agencies, you have the potential to earn $3.14M per year (this is based on data reported by real founders).

Further, you could have your initial investment back within months. Simply put, it’s a business worth a shot, especially if you have the resources and make the necessary efforts to achieve or surpass the target.

With a market size of $, it will be possible for you to build something that grows and turns into a flourishing business. As such, it’s the type of business you might want to consider starting.

Of course, you must learn and understand every aspect of running a marketing agency to ensure success. Still, as long as you have the initial investment and can endure a few months before your actual gains, this business could be worth it.

You might want to consider reading more specifics about successful marketing agencies case studies.

Examples Of Profitable Marketing Agencies

Here are a few examples of profitable marketing agencies, and a few more details about them:

1. Kreatix ($1.02M/year)

Oliver Op de Beeck and William Matthynssens started Kreatix, a digital/marketing agency, while in university to supplement their studies. They attracted their first client through a Facebook post and built a successful business through word-of-mouth marketing, showcasing their human side and commitment to understanding their clients. They have now built a solid foundation and attract daily leads through their inbound marketing strategy, with plans to become one of the top agencies in their province.

Is it profitable? Yes
How much money it makes: $1.02M/year
How much did it cost to start: $2K

Long-time friends Oliver and William started their own digital marketing agency while in college.

Two friends started a digital marketing agency, Kreatix, from their shared love of the internet, and built a thriving business with over 150 clients using inbound leads and storytelling on social media platforms despite having not studied in the field.

Read this case study

Read by 8,344 founders

2. Jakt ($3.6M/year)

Anthony Tumbiolo, founder of Jakt, started the business after running an events business and teaching himself how to code in college. He realized he loved helping other businesses succeed and saw the potential to impact many people by creating software for them. Jakt started with a six-month contract from their first client, and they have since grown their business through referrals and strategic channel partnerships. In 2018, they achieved $4 million in revenue with a 20% profit margin.

Is it profitable? Yes
How much money it makes: $3.6M/year

How I Started A $4M/Year Digital Product Agency

Jakt, a digital product and innovation studio based in NYC, works with both startups and large enterprises, operating on a revenue of $4 million in 2018 with a 20% profit margin, with focus on referrals and channel partnerships to attract and retain clients.

Read this case study

Read by 8,564 founders

3. Visiture ($10.8M/year)

Brian Cohen, the founder of Visiture, came up with the idea for his eCommerce marketing agency after selling his previous businesses and gaining experience in online marketing. Fueled by his passion for eCommerce, Cohen and his partner decided to focus on working with eCommerce brands and began marketing through PPC ads and content marketing, ultimately leading to the growth and success of Visiture.

Is it profitable? Yes
How much money it makes: $10.8M/year

How I Started A Marketing Agency That Grows At 84% With $1MM Monthly Revenue

eCommerce marketing agency Visiture has achieved impressive growth, with revenues up 84% YoY, exceeding $1m monthly recurring revenue, representing more than 140 merchants including Spanx and BarkBox, and landing at #753 on the 2019 Inc. 5000 list; CEO Brian Cohen advises startups to concentrate on one core service line, work with well-known brands and to use content marketing to establish expertise.

Read this case study

Read by 9,060 founders

Learn more about starting a marketing agency:

Where to start?

-> How to start a marketing agency?
-> How much does it cost to start a marketing agency?
-> Pros and cons of a marketing agency

Need inspiration?

-> Other marketing agency success stories
-> Marketing ideas for a marketing agency
-> Marketing agency slogans
-> Marketing agency names

Other resources

-> Marketing agency tips
-> Blog post ideas for a marketing agency
-> Marketing agency quotes

How much can you make with a marketing agency?

With a marketing agency, you can make an average of $3.14M revenue per year (based on data reported by real businesses).

You can start with an initial investment as low as $1. Then, with proper knowledge and sustained effort, you could have an ROI (return of investment) within 11 months.

How much does a marketing agency make a week?

Based on our data, average weekly revenue for a marketing agency ranges around $65.5K. As such, you could see monthly revenues of $262K.

To know if your marketing agency achieves the weekly profit target, you need to keep track of the total earnings you get per day. Afterward, you'll want to consider subtracting the expenses you have daily.

Learning your weekly profit can also show whether you're hitting your target goal for your marketing agency.

How much do marketing agencies owners make?

The income of a marketing agency owner can vary depending on various factors such as location, size, competition, and the owner's business skills.

But to give you some idea, the weekly revenue of an established marketing agency is about $65.5K. But this can be lower or higher depending on so many factors - it's almost impossible to say exactly.

While the potential for earning a good income as a marketing agency owner exists, success in this field requires a commitment to providing quality products and services and building a strong reputation within the community.

Marketing Agency Profit Margins

Generally speaking, a marketing agency can expect profit margin of around 23%. Profit margins refer to the percentage of revenue that remains after deducting all expenses associated with running a business. In the case of a marketing agency, profit margins can vary depending on various factors, such as the type and quality of products sold, the size of the store, and the level of competition in the area.

However, these figures can vary depending on the pricing strategy, inventory management, and overall efficiency of the business. To maintain healthy profit margins, marketing agency owners must focus on managing costs, negotiating favorable supplier terms, and providing high-quality products and services to attract and retain customers. By doing so, marketing agency owners can ensure long-term sustainability and profitability for their business.

Marketing agency owner salary

The salary of a marketing agency owner is an unpredictable figure. It's significantly influenced by numerous factors, including the store's location, its size, and the degree of competition. An owner of a well-established marketing agency, in a prime position, might see an average weekly salary around the ballpark of $15.1K.

But it's worth noting, such numbers aren't always consistent. The earnings can vary wildly, potentially swinging by as much as 80% either way.

Achieving consistent success and maintaining a reliable income stream in this industry requires a deep commitment. It's imperative to offer high-quality products, deliver impeccable customer service, and nurture a trusted bond with the community you serve.

Conclusion

In a nutshell, based on many of our examples, a marketing agency may be a promising business to start - but the success of your marketing agency mostly depends on your effort and your approach.

If you focus on these, you'll have a much higher chance of a profitable marketing agency.

Part of

Starting A Marketing Agency: Everything You Need To Know

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