Digital marketing is a broad field that includes anything done to market your products or services over the internet. The field of digital marketing is divided into a large number of highly specialized services. Because of the diverse skill set needed to create and implement a holistic digital marketing strategy, most online businesses find it much easier and more profitable to hire an external agency to provide them with services. These agencies will undertake digital marketing work on behalf of their clients, assisting with website design, writing copy and advertisements, designing email marketing campaigns and more, all in order to increase profits for their clients.

However, one difficulty online merchants face is deciding how much they should spend on digital marketing services. The cost of hiring an agency represents a significant expense, and you want to be sure you’re getting your money’s worth. The first and most important step toward making sure you’re hiring the right agency is to know how much you can expect to pay for each type of digital marketing service.

We’ve broken down the different types of digital marketing services available and will discuss pricing and costs for each.

List of Digital Marketing Services

Before we start digging into costs, let’s list the most commonly available marketing services. Depending on the agency, it may bundle several of these services together into a package or offer individual services on an a la carte basis.

  • Display and Pay-per-click advertising. Display advertising includes displaying banner/sidebar ads, rich media, video, images and more to advertise your products to users on other websites. Pay-per-click advertising is a type of advertising, usually run on Google or Bing, based off of keywords and setting bid prices per click.
  • Email marketing. Email marketing is the practice of sending out promotional/advertising emails. For online merchants, this is most typically a remarketing technique designed to help retain existing customers or convert customers who abandoned their carts.
  • Local marketing. Local marketing typically blends several marketing approaches in order to target customers living within a specific geographical area.
  • Retargeting. Retargeting can be done via paid advertising, email marketing, display advertising and website design. Retargeting refers to any marketing materials delivered to a potential customer based on previous behaviors, such as clicking an ad, visiting a webpage, adding an item to a cart or making a purchase. Retargeting is always done as part of another campaign, such as email marketing or shopping feed advertising.
  • Shopping feeds. Shopping feed advertising revolves around the purchase of paid advertising space on search engines such as Google. These ads appear in a carousel or sidebar within search results and within the Shopping tab of Google.
  • Search engine optimization (SEO). SEO is the practice of optimizing content for search engines in order to improve organic (nonpaid) rankings of a website.
  • Social media marketing (SMM). Social Media Marketing is the practice of marketing over social media platforms such as Facebook and Twitter. It can include both organic (audience-building) social efforts and paid social advertising.
  • Website design. Website design services include both web page design and building the overall architecture and user flow of a website in order to increase conversions.

How Much Does It Cost To Hire a PPC Agency?

PPC Agency Costs

PPC requires active maintenance, so most agencies offer ongoing monthly plans. A digital advertising agency typically provides strategic direction, ad creation, campaign creation and maintenance, and reporting. Monthly agency costs are usually between $600 and $2000 per month. When hiring a PPC ad agency, discuss your total budget and how much growth you’re hoping to see in your sales. This will help you set realistic sales goals, invest your money where you’ll see the biggest returns, and (most importantly) take all of the work of creating ads, managing bids and reporting off of your already-busy hands.

PPC Cost-Per-Click Costs

PPC costs are calculated on a cost-per-click basis, so you can set a hard spending limit and stick to it. The average cost-per-click of a Google Display Network ad is $0.58, so you’ll be paying about $580 per 1,000 clicks. Cost-per-click can vary widely based on the industry you’re in, so if you hire an agency, a PPC specialist will be able to guide you towards an appropriate monthly budget. Depending on your budget and what sorts of ads you want to use, you’ll need to create text ad copy, image ads, rich media ads (animated or interactive ads) or video ads for your product(s). You’ll also need to factor in the time it will take to create and optimize your ad campaigns. It usually takes about 5 to 20 hours to create a new ad campaign, and an hour or two per week to measure the results and tweak your targeting.

How Much Does It Cost To Hire an Email Marketing Agency?

Email marketing boasts the highest ROI of any marketing channel, averaging $44 of income for every dollar spent. This makes email marketing a high priority for most online merchants, but running a successful email marketing campaign is more difficult than simply writing and sending an email. The right email marketing agency can be the key to unlocking more sales. Here’s how to choose the best agency for your business and what you can expect to pay.

Email Marketing Agency Costs

When hiring an email marketing agency, the cost will depend largely on the services you need, the volume of emails being delivered and the complexity of the overall project. Online merchants tend to run relatively simple, low-volume email campaigns, which will help keep costs down. Many email marketing agencies provide “full-service” packages, in which they handle everything for you and charge a recurring monthly bill. If you’re only commissioning particular services, here is a list of the main factors that will impact the price of hiring an email marketing agency:

  • Strategic guidance. If the agency handles your marketing strategy for you, they’ll need to spend time analyzing your business and coming up with a plan. For a small online business, this will typically be a one-time cost between $1000 and $2000, depending on how many contracted hours it takes to create a strategy.
  • Email creation. The final cost of email creation will depend largely on the type of content contained within the email. A simple, text-heavy email using readily available graphic resources will typically cost between $100 and $200 to create. If the email requires custom graphics, that cost will increase to roughly $400 to $500. If the email contains a custom video, the creation cost will go up to approximately $1000 (or more, depending on the length and format of the video). Reusing premade graphics and video resources can be a great way to cut down the creation costs but may not convert at the same rate as a highly customized email.
  • Distribution lists. For brand-new businesses, collecting enough emails to run an email marketing campaign can be difficult. A small business may need to run different types of campaigns to gather email addresses before they’re ready to start email marketing. If you’re hiring an agency, make sure to discuss your distribution plans with it.

SEO or Local SEO Agency Costs

Search engine optimization (SEO) is the process of optimizing your website and attracting backlinks from other domains in order to improve your site’s rankings on search engines. SEO traffic is incredibly valuable because it’s completely free (no costs per click), builds the authority of your site and brand, and provides the bulk of many sites’ online traffic.

Costs of Hiring an SEO Agency

SEO costs will vary depending on your business’s needs, but a survey of over 600 SEO agencies found that the average monthly costs of an SEO agency are usually between $750 and $5000 per month for standard SEO services. It’s also very common for businesses to hire SEO agencies on a per-project basis to fix particular issues with their website. Per-project costs can vary widely depending on the project, but common projects typically range between $200 to $1000. If you’re hiring an SEO agency on a per-hour basis, the hourly costs typically range between $75 and $200.

What Services Are Offered by SEO Agencies?

As mentioned, the pricing of your SEO campaign will depend on what you need. Below is a list of the most commonly required SEO services provided by agencies. A full-service SEO agency should provide most or all of the services on this list:

  • Organic strategy. This will include both selecting which keywords to try to rank for and a plan to rank for them.
  • Technical site fixes. A technical site audit will look through your entire website for problems like broken links, improper redirects, sitemap issues and much more. The results of your technical site audit have a large impact on your overall SEO costs since some technical problems can be time- and labor-intensive to fix.
  • On-page optimization. On-page SEO optimization will make sure that your pages are targeting the correct keywords within their copy, meta elements, images and linking structures.
  • Backlinking services. Backlinks are very important when it comes to ranking your site, but they can be difficult to get. Your SEO agency should have a plan to attract backlinks to your pages from relevant external sites.
  • Content Creation Strategy. Some SEO agencies create content designed to rank well for their clients, while others provide strategic direction about what to write next. Either way, your SEO agency should have an active role in your content creation process.

Local SEO Campaign Management

A local SEO campaign will focus on ranking well for keywords with a location in them (like “electric bike Portland”), as well as make sure that information about your business, such as an address, phone numbers and store hours, show up correctly in search engines. Even if you’re familiar with the basics of SEO, running a local campaign requires additional knowledge and expertise to do it correctly. A successful local SEO campaign can skyrocket your traffic from local sources, but it’s not easy. The right local SEO agency can put your business on the map – literally.

Local SEO Agency Costs

The biggest cost associated with local SEO will be the work hours needed to plan, execute and monitor your local search campaign. Some agencies provide free SEO audits for potential clients, which can be a great place to get a general sense of your local SEO potential and the costs of a campaign. Depending on your needs and budget, you may decide to hire the agency on a per-project basis to fix issues with your site or (more commonly) contract an agency to perform ongoing monthly local SEO services for your site.

On average, small businesses can expect to pay between $750 and $2000 to hire a local SEO agency to manage their local search efforts.

Average Costs of Shopping Feed Campaigns

Since shopping feed campaigns are typically cost-per-click based, you can set very definite budgets for how much you want to spend. There are no minimums on bid amount, and you can set budgets as low as a dollar per day. The average cost of Google Shopping advertising is $0.11 cents per dollar of sales, although the exact cost will depend on the merchant, its products and the quality of its landing pages. Set an initial shopping feed budget, test it for a few months, and see if you’ve paid more than 10% of your overall gross sales volume. If you have, you should start looking at ways to optimize your campaign and bring it down to the average amount (or lower).

Set a Budget and Goals

If an agency is handling your shopping feed campaigns for you, make sure to speak with it before beginning a campaign and get an estimated or target CPC for your shopping feed ads. Divide your total budget by your cost per click to determine how many clicks your budget will get you. It’s also a good idea to set an estimated or target conversion rate for your landing page. Check the results at the end of the campaign, and calculate your actual CPCs and sales volumes. If you fail to hit your target goals, discuss with your agency how to improve your campaigns or set more realistic goals.

Costs of Hiring a Social Media Marketing Agency

Social network sharing and commenting in the online community, Woman hand holding smartphone and using application social media

Depending on the size of your business and the services needed, the costs of hiring a social media marketing agency will vary. For small businesses, the cost of hiring an agency will typically run between $1000 and $5000 per month.

When hiring an agency to manage your social media marketing, you’ll typically begin by setting initial goals and then working out a budget. Your goals will generally be focused on increasing a particular metric or metrics, like the number of followers or social referral traffic to your website. You’ll have a large amount of control of your final budget, and your agency will give you cost estimates for reaching particular goals or milestones.

The largest factors affecting the costs of hiring an agency to manage your social media will be the following:

  • Your site’s goals
  • Which social media platform (Facebook, Instagram, Twitter, etc.) you’re using
  • Post creation costs – Text-only posts will cost little, while custom image/video posts can be expensive
  • Technical setup and account maintenance needs
  • Reporting – tracking setup and campaign performance monitoring

Average Cost of Website Design Services

Website design services can include projects as simple as creating a new landing page or as complex as redesigning an entire website. Design agencies are almost always hired on a per-project basis, so your final cost will depend on what you need done. It’s recommended that you contact a design agency in order to get an initial quote for your project.

List of Website Design Service Costs

Below is a list of estimated prices for some of the most common website design services for small business websites. The final costs will vary widely depending on your website and the agency hired. Also, be aware that most design costs are built into other projects (such as social media advertising) since most marketing projects require some level of design resources.

  • Custom website design: $3000-$8000
  • Custom website template: $1000-$2500
  • Paid ad or banner ad creation: $100-$200
  • Professional video creation: $900-$1200
  • Custom graphics or infographic creation: $200-$500

When contacting a design agency, make sure to have as complete an idea of what you want as possible. The more accurately you can describe your envisioned project to your designers, the closer the final product will be to what you initially imagined.

Is It Worth It To Hire an Agency?

In sum, yes. The rewards of digital marketing are undeniable – within the United States alone, over $500 billion was spent on ecommerce websites last year. With a growing market comes lots of potential. Hiring an agency to help you with your digital marketing allows you to collaborate with a dedicated team of pros. Whether you’re looking for SEO, SEM or design services, the Studio team has a track record of success in growing small businesses like yours.