Digital marketing should be at the forefront of every company's efforts, but it's often a neglected part of the budget. Building up a platform on social media or running a website can end up lower on the list of priorities, and it's often allocated less money.
Budgeting for cost-effective marketing can be one of the trickiest decisions a business makes. Remember: marketing is an investment. When you pay a freelancer, employee, or agency to run your digital marketing, you should get your money back and more.
How much do digital marketing agencies cost, then? Is it better to have an in-house employee or team? How much does each service cost, and why?
The questions above are the perfect way to start your research and build your budget. And our article below gives you all the answers you need.
Cost of digital marketing in 2021
Digital marketing for businesses gets more complicated with every passing year. It can be hard for businesses to assess what services they need to be successful. It's also very difficult to find resources online that help you estimate a fair price.
Many digital marketing agencies and freelancers aren't upfront about their pricing; they rely on quotes instead. If pricing is offered, it is almost always in the form of base pricing or wide ranges due to the unique needs of each project and client.
The best way to confront this problem is to know exactly how much you can afford before you approach digital marketing professionals. Then, work with them to build a plan that works for you.
On the other hand, it's important to stay realistic about the value of digital marketing. Be prepared to invest in high-quality services, otherwise, you're wasting money!
Research in 2020 showed that you should expect to pay around £5,500 for a monthly retainer that handles your marketing strategy, organic social content, SEO monitoring and optimisation, content marketing and paid ads management (excluding ad spend).
Pricing models for digital marketing
One of the reasons why digital marketing costs are so difficult to assess is that there are many different pricing models. There are four main ways that professionals can charge. Other more experimental models pop up sometimes.
It will be up to you to receive several quotes and compare professionals before you decide, but make sure you aren't comparing apples to oranges. You could be presented with project-based charges, hourly charges, or monthly retainers. You could also hire a full-time employee to work in your company's marketing department.
Full-time digital marketing employees
Many businesses choose to onboard full-time employees to take charge of digital marketing efforts. It can be convenient to have a professional dedicated to only your business who knows the brand well and depends on its success.
The cost of onboarding and maintaining full-time employees can outweigh the benefits. Small and medium-sized businesses often do not have a significant marketing budget. Paying for the overhead, benefits, and salaries of full-time employees is not cost-efficient.
Hiring a freelancer or agency is more cost-effective. You avoid the overhead costs while still receiving high-quality marketing services.
There is also the risk of losing your employee and having to start from scratch. When you rely on one person to be the expert, but they quit the job, you lose their expertise and knowledge. You'll have to spend more money onboarding a new employee and training them, and wait for them to build their own knowledge base.
Hiring a full-time employee or freelancer also raises the risk of certain areas of marketing suffering. Instead of having a team of experts who can all specialize in one area, you are relying on one person to do everything. For example, you might have great SEO but poor social media engagement.
Relying on an agency to handle your digital marketing means that you won't run the risk of one person holding all the knowledge. You can also count on them to combine their expertise and efforts to give you a high-quality full-service experience.
Project-based digital marketing costs
When you search for digital marketing services online, one of the most common forms of price models is the project-based model. By using this model, digital marketing professionals can offer a set service for a set cost. They'll establish a deadline or goal that will end the contract.
Depending on your situation, a project-based model can be a good choice. You will know exactly what you will be billed and there will be a one-time payment. Once the project has been completed according to the agreed terms, however, that professional ends their relationship with you. You are left to continue what they started on your own.
If you find yourself in need of follow-up services or need to amend the details of the project, you will most likely be faced with extra charges to your bill. You will want to review the contract very carefully to make sure it includes exactly what you need. It should have a detailed scope so that you know exactly what you're receiving as an end product.
Digital marketing charged by the hour
If you are searching for a freelancer, it is typical to see hourly price models for services. These hourly rates are based on the amount of experience the freelancer has and the level of their services. Hourly rates for freelancers can range widely, so it's important to do your research on the professional.
With this price model, every hour that the professional spends on your project is billable. This model can be good because you only are paying for the amount of time that is used to complete your project, however, this can quickly get out of hand. Because there is no cap on the cost, and any tasks related to your project can be counted as billable, the charges can quickly add up.
If you choose to pay someone hourly, it is important to pay close attention to hours spent so that you are prepared for the bill later.
Paying for monthly retainers
It is generally agreed among industry professionals that monthly retainers are the best pricing model for digital marketing services. By paying for professionals to stay with your business month to month at a set price, you are getting to benefits of having a dedicated "employee" without worrying about unexpected costs or paying for overhead.
Monthly retainers allow you to pay one constant price per month to keep those services for as long as you desire. You will be able to set your budget and keep it with ease, rest assured that the services will be consistent. Additionally, the longer you work with those professionals, the better they will get to know your brand and audience.
When you work with an agency that has a monthly retainer, you will be able to set the scope of the project upfront. The agency, however, should be flexible and communicate with you consistently to adapt their methods to your growing company's needs.
Average marketing costs per price model
Now that you understand the different price models that digital marketing professionals use, you're dying to know about the average prices. Truth be told, the averages are not extremely accurate indicators. The pricing ranges so widely that you will need to request several quotes to be sure about your project's specific value.
One thing is certain: digital marketing spend is going up, and fast. Companies are now spending 25% of their total marketing budgets on paid media with digital media as the rising star, according to Gartner research. As the value of digital marketing goes up, so will the costs, so prepare yourself to invest in your marketing budget.
As a rule, your minimum budget for digital marketing should land at no lower than 5% of your revenue. A better amount is between 10% and 20% of your revenue.
Take these estimates as a guide and remember that they aren't set in stone. Each professional and agency will have their own way of estimating costs and each client is unique!
Cost of a full-time employee
In order to compare the costs of having a full-time digital marketing employee to outsourcing your digital marketing, it's important to estimate what it would cost you overall to hire and maintain the employee. On average, a digital marketing employee would cost your business £25,500 to £72,800 or more for salary alone. Other costs, such as benefits and vacation time, could increase that cost by more than 25%.
Keep that number in mind while you search for freelancer or agency rates for your digital marketing needs.
Freelancers charging hourly
Freelancers often charge an hourly rate, but their rates range widely. Surveys have found that freelancers charge on average between £36 to £73 an hour for digital marketing services. Some charge less due to inexperience or inability to find clients willing to pay higher rates, while others charge double the average and specialize in niche markets.
Generally, high-quality freelancers charge around £73 to £182 an hour. They should offer you services with specific outcomes and know how to communicate with you and regularly send reports on your marketing progress.
These rates will change if you are only asking for one type of marketing service, such as SEO or website design, or will increase if you are requiring an entire package of mixed services.
Average project-based rates
When it comes to project-based rates for digital marketing, the average lands around £730 to £5,500 per project. The cost really depends on the type of service you are looking for, though. For example, a website build project can be much more expensive than a paid or organic social campaign.
Project rates also steeply increase depending on the professional's experience and if they specialize in a specific niche. You can find a cheaper website project rate if you go with someone who has only been in the business a year and hasn't focused on a specific type of client, but you'll also be less sure about the end result.
Monthly retainer averages
In the United States, monthly retainers for digital marketing agencies can land anywhere between £730 to £72,800. The wide range is due to the different sized agencies and levels of service. Smaller agencies will often offer less services and have less resources, while large agencies can boast a full menu of high-quality services to larger clients.
Agencies that have many large clients are able to charge higher monthly retainers, so unless you're also a large client, you probably will not be able to afford their services.
If it's not in your budget to hire a massive agency, there's nothing wrong with hiring smaller agencies. In fact, they will be more accustomed to working with your size business and audience, providing you with a more personal and tailored experience.
Rates for digital marketing services
The above rates, whether project-based or monthly retainers, largely depend on specifically what services your business requires. There are many different types and techniques that make up the digital marketing suite, including website builds, paid advertisements, organic growth, social media management, PPC management, SEO, and content marketing.
Here's what you should know about each one and how to find a fair rate.
How much does website design cost?
Website design is one of those things that has become way more accessible to individuals and businesses. Website hosting services offered by Wix, WordPress, and others not only allow you to build your website but help you with SEO and other marketing tools.
Depending on your experience with design software and whether you have a keen eye for making things look great, it might take some time to get used to their interfaces and learn about their tools. Also, if you don't have design and digital branding experience, it can be difficult to express your vision clearly while building an engaging and useful website that will drive sales.
Theoretically, you could set up a website in only a few hours, but that doesn't mean it will be the best or the most effective version of the website for your business.
If you choose to build a website yourself, you might be spending less money, but you're also spending so much of your own time. A great website could easily take 100 or more hours to set up properly. You also need to factor in consistent maintenance after your website is complete and published.
There are also costs such as buying a domain and paying for the subscription to whichever hosting service you are using.
If you hired an a professional to set up your website last year with a project-based pricing model, you could have been charged on average around £5500. In 2021, expect prices to increase, but the range goes from around £1,800 to £72,800.
Paying an agency to take care of setting up your website will cost you around £10,000 and upwards, but with it, you will get an expert team with a ton of resources. Even if you feel like you can build a website yourself, it's worth getting a third-party perspective.
How much does PPC management cost, or paid ads?
Paying for digital advertising is a risky business. Platforms like Facebook and LinkedIn have built-in ad creation tools that anyone can use. It seems easy enough, but in reality, you might be wasting your money.
True copywriting is a marketing service that is highly valued and requires training and practice. Many businesses jump into paying for ads with little idea about how to write copy or accurately target their audience. You might think your ad is perfect, but after you run it for a month, have you gotten any leads or sales from it?
PPC Management is a segment of this type of marketing. Professionals will bid on search terms, such as through Google, in order to get websites to come up on top of search results. This service is highly valuable because showing up as one of the top ten search results on search engines like Google is one of the fundamental rules for successful marketing.
Utilizing a professional is the best choice if you choose to pay for advertisements or search results placement. Instead of losing thousands of dollars by wasting time on poorly made ads with no ROI, you can pay around £1455 to £3640 for set up fees with a project-based model. You can be sure that professionally created ads will generate leads and boost sales.
When you pay an agency to run ads, you will give them your agreed monthly ad spend, and your PPC rates will run about 5% to 20% of that spend.
How Much Does SEO Cost
No, it doesn't cost you anything to set up SEO yourself, but are you sure you're an expert on SEO? Will your time spent on setting up SEO be wasted with no leads?
It could take 40 hours or longer to choose proper keywords and utilize them in a way that will make a difference for your business. SEO is also tricky because it is constantly changing. The rules aren't really written and search engines are always evolving to keep businesses from manipulating search results.
Paying a specialist is a great option, as they should be up to date on the newest changes and have all the right tools at their disposal. So how much do digital marketing agencies charge? SEO services could range anywhere between £360 and £14,550 a month, depending on the complexity of your project and the expertise of the professional.
If you pay for a monthly service from an agency, you will know your SEO is constantly being updated and you won't have to pick up where a project was left off.
Social Media Services
Social media is a great way to affordably market your business, and the tools are very accessible. Because of the accessibility, you could budget your time to keep up with social media on your own. However, it takes a tremendous amount of time not only to set up accounts, but to maintain them in a way that does you any good.
Social media is not just about proving content, but about engaging with other people's content. Platforms boost your content depending on how much engagement is happening, which is determined by your engagement savvy and the quality of your content.
You can pay for a social media marketing service so that you don't have to budget a huge amount of time during your busy week. You could pay on average around £360 to £730 a month for basic services. Many companies, however, choose to spend more for full services that cost as high as £7,300 a month.
How Much Does Content Marketing Cost?
Content marketing is becoming a very popular section of digital marketing because it solves the problem of providing valuable information to your potential customers. Businesses can pay professionals and agencies to create consistent blogs, for instance, to drive traffic to their website and boost sales.
How much does it cost to write a blog? Content marketing can go for more than £820 a month, depending on how much content you ask an agency to provide.
How Much Does Email Marketing Cost?
Email marketing is a great way to reach current and potential customers once you've built a solid list of leads. Professionals know the best way to write email copy, including subject lines, to get people to open emails and click through to your website.
Email marketing can go for a rate of £220 to £3640 a month.
How Much Do Digital Marketing Agencies Cost?
Pricing for digital marketing services can often be daunting, especially for small businesses. A full-service digital marketing agency could cost you between £25,500 and £105,500 a year. Costs for digital marketing agencies, however, can add up fast, so they charge to cover these expenses.
Digital marketing professionals invest time and money into continued education. They network, attend conferences and webinars, take courses, and research markets and target audiences. Social media platforms, web hosts, and search engines are also ever-evolving, making it difficult to keep up with the latest trends, tools, and techniques.
There are a lot of great resources out there to get started marketing on your own, but professionals are using top-notch tools and software. There are keyword finders, analysis tools, scheduled posting tools, graphics, and video creation software, all adding up to significant monthly and yearly costs.
Paying for an agency gives you top-tier service, and their prices reflect the services and experience they offer.
You can start by hiring Beyond, a full-stack digital marketing agency, for only £1,500 to £5,000 a month. They can handle all of the above with a monthly retainer combined with a long-term partnership that will yield the best results for your business.
Ready to Boost Your Marketing Efforts?
Without digital marketing strategies and expert implementation, your business will fall behind. It's not a matter of "if" you need to spend money on digital marketing, but "how."
So how much do digital marketing agencies cost for you? Find out by starting your digital marketing project with a free review from Beyond!