Hi, I’m Alice. Over the past decade, I’ve worked alongside and within digital marketing agencies across industries like SaaS, non-profit, and finance. In that time, I’ve learned what makes (or breaks!) the best agencies — and it often comes down to knowing exactly what they stand for and who they serve.
Ask a team of marketers for a digital marketing agency definition, and you’ll likely get a range of answers, each focusing on different specialisms. While that might seem unhelpful at first, their versatility is exactly why agencies remain so relevant.
Agencies provide specialized support across all areas of online marketing — from digital branding and content creation to performance-based marketing. In my experience, no matter the size or experience level of a marketing team, there’s always at least one skill gap to be filled — and that’s where external agencies come in to help some of the biggest businesses in the world.
If you’ve been thinking about starting a digital marketing company, this article will help you figure out what kind of agency you want to build and provide you with the framework and key tools to turn your vision into reality.
Understanding Digital Marketing Companies
So, what is a digital marketing agency? Let’s get into the details.
Digital marketing companies help businesses promote their products or services online. Working closely with their clients to understand their goals, they create tailored campaigns that increase awareness, boost engagement and trust, and ultimately create sales opportunities.
Most of us spend a considerable amount of time online these days, and engaging with brands we know — or discover — in digital spaces feels like nothing special. But there’s plenty of work going on behind-the-scenes to create these serendipitous connections.
If you’ve seen an influencer talking about their favorite ice cream on TikTok, received an email from the optician you visited last month, or clicked on the top link you found on Google, there’s a good chance a digital marketing agency was behind it.
Using online channels, these agencies help all types of businesses to not only reach their target audience, but also build a relationship with them. They manage social media campaigns to boost brand awareness, send emails to keep customers connected, use SEO to improve website visibility, and much more.
Having a strong online presence is a key component of success for both B2B and B2C companies, and digital marketing agencies are growing as a result.
What Do Digital Marketing Agencies Do?
In its simplest terms, a digital marketing agency helps businesses get seen by the right people, at the right time, on the right platform.
Whether they’re working with a startup that’s trying to be noticed or a larger company refining its strategy, these agencies are often the hidden experts behind online marketing efforts.
Here are some examples of digital marketing agency services:
Search Engine Optimization (SEO)
Optimizing a website so that it ranks higher in search engine results. This can include keyword research, on-page content management, and technical improvements.
Content Marketing
Producing high-quality content, such as blogs and videos, to attract, engage, and retain a business’ target audience.
Social Media Management
Creating, scheduling, and analyzing posts for social media. This can include both paid and organic strategies and aims to increase a brand’s presence on platforms like Instagram, Facebook, and LinkedIn.
Pay-Per-Click (PPC)
Developing and executing digital advertising campaigns to drive website traffic, usually with a focus on key sites like Google Ads and Amazon.
Email Marketing
Creating and sending email communications to customers and leads to nurture relationships, share information, and boost engagement.
At the center of what digital marketing agencies do is selecting the right marketing tactics for their clients. Beyond core services, it is common for agencies to offer web design and development, influencer marketing management, and analytics expertise.
With custom approaches for all clients, they deliver results that align with wider business goals and increase sales.
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Types of Digital Marketing Agencies
There are several types of digital marketing agencies. While some choose to focus on a single specialism or industry, others offer a wider range of services and work with a variety of firms.
If you’re considering starting a digital marketing company, my recommendation is to play to your own strengths. Think about what skills you already have (or are willing to upskill quickly!) and start from there.
Here’s a quick guide to the most common types of digital marketing agencies to inspire you:
Full-service Digital Agencies
Full-service digital marketing firms provide a comprehensive, end-to-end service for their clients. They cover all aspects of digital promotion, from social media and content creation to PPC (pay-per-click) management and SEO services for businesses.
By employing a team who bring expertise in different areas, full-service agencies offer a one-stop solution, providing integrated strategies and consistency across channels.
In my experience, this type of agency often appeals to businesses looking to outsource their marketing as a whole. Working with one agency can improve time and cost efficiency and make managing omnichannel campaigns simpler. However, it’s more common for businesses, especially established brands, to outsource just a segment of their marketing efforts — like paid ads or influencer marketing — and that’s where specialized agencies come in.
Specialized Agencies
Specialized digital marketing companies focus on specific niches, rather than offering a broad range of services. Examples include a social media marketing agency, an email marketing campaigns agency, or an influencer marketing agency.
Businesses that choose a specialized agency benefit from working with experts who know their niche inside out — from established practices to the newest trends. This means they’re perfect for those with a particular marketing need.
For businesses that are weighing up hiring in-house marketing vs. outsourcing, expertise may be the deciding factor. These agencies pride themselves on being an authority in their space, and businesses expect deep knowledge, tailored solutions, and better, more focused results when working with them.
Industry-specific Agencies
Industry-specific companies serve businesses within a particular sector, such as healthcare, finance, or e-commerce. With clients who rely on custom strategies, this type of digital agency business model requires knowledge and experience within a specific field.
These agencies combine digital marketing expertise with an understanding of regulations, customer behaviors, and other challenges within a professional market. Their experience and highly specialized knowledge allows them to deliver highly relevant, industry-focused, and legally compliant campaigns.
“The best agencies to partner with are those that know exactly what services they offer and what their brand stands for,” shares Jess Worb, Marketing Manager at Durable. “Whether you opt to specialize or keep things broad will shape your approach to clients, so make that decision early on to elevate your company in the industry.”
Digital Marketing Agency vs. Traditional Marketing Agency
With online channels becoming increasingly central to modern marketing strategies, the lines between different types of agencies can get a little blurred. However, if you’re thinking about starting your own company, it’s important to understand the differences between digital marketing and traditional marketing.
Digital marketing agencies use online channels and strategies. They harness the power of the internet to reach their target audience — think TikTok, Instagram, email, digital display ads, and more.
With analytics and metrics available, online channels enable data-driven marketing strategies, highly targeted campaigns, and performance tracking. Results are not only measurable but can be adjusted in real-time to improve results.
In comparison, traditional marketing agencies concentrate on offline methods, such as TV and radio commercials, print adverts, and direct mail campaigns. These long-established channels are known for their broad reach and can help build brand awareness, but it’s more challenging to measure their effectiveness due to limited performance data.
Many traditional channels also have higher costs associated with them. For example, both creating a television advert and buying a prime-time spot could easily cost thousands, while social media campaigns are often more affordable.
When it comes to digital marketing vs. traditional marketing, the key difference lies in the channels and strategies used. While the scope of tactics offered by many agencies has grown rapidly in recent years, with digital spending increasing, it is important to be clear which area you want your company to focus on.
Should You Start a Digital Marketing Company?
If you want to start a digital marketing company, I have good news for you. According to Group M, a leading media agency, global advertising revenue will reach $1.1 trillion in 2025, and digital channels will account for 73% of the total. With a growing demand for digital marketing services in almost every industry, the market is primed for new agencies to step in.
So, with record-breaking spending predicted, how do you work out if you’re ready to take an entrepreneurial leap? Start by asking yourself these key questions:
#1. Do You Have the Marketing Skills Required?
Running a digital marketing business requires strong marketing skills. Whether you want to set up a full-service agency or provide content marketing services, you need expertise to deliver results. From SEO to social media, it’s worth reviewing key areas and building up your knowledge in others.
Beyond technical skills, it’s also worth considering the competencies you need to run a business. For digital marketers, strategic thinking, creativity, and communication abilities are vital.
#2. Are You Ready to Cover Startup Costs?
Digital marketing agency startup costs are often top of the list of concerns for would-be company owners. While running a remote digital marketing business will need less initial investment than some other firms, a small budget can help you set up your company.
To ensure smooth operations, common investments include office equipment, software tools, and creating a website to bring in clients.
You’ll also need to cover hiring costs and be responsible for paying your team and any freelancers you work with, so it’s also worth considering digital marketing company pricing models at this stage.
#3. Do You Have a Client Acquisition Strategy?
In the service economy, finding clients is one of the most important parts of launching a business. Even those running a successful digital agency need to continually attract (and retain) customers to make a profit.
Before you launch, it’s sensible to think about how digital agencies get clients and have a strategy in place for your own customer acquisition. This might include networking, cold calling, or leveraging referrals — as well as a digital marketing plan, of course.
#4. How Will Your Agency Stay Competitive in a Busy Market?
Whether you’re considering starting a creative digital agency or focusing on analytics, navigating the competition will be key to achieving your goals. It’s important to understand what other agencies are available to your target market, and to ask how your brand will stand out.
There are many profitable niches in digital marketing, but the challenge is bringing value to a crowded space.
7 Steps to Launching Your Own Digital Marketing Agency
Once you’ve made the exciting decision to open your own online marketing company, you might be wondering where you should begin.
Starting a digital marketing agency requires careful research, strategic planning, and a solid execution plan.
To begin with, I’d recommend reading Durable’s detailed Business Starter Guide, but for now, here are seven essential points to help you get ahead:
- Conduct market research: Understanding your market can give you a significant advantage when you launch a new agency. You can position your company more effectively by conducting competitor analysis, gathering industry insights, and identifying potential clients.
- Develop a business plan: Your business plan is a guide to your agency’s foundations and ambitions. It should outline your business name, mission, services, target clients, pricing strategy, and growth plans.
- Launch your website: Your website is your digital storefront. It should share important information about your company — from a digital marketing agency description to your brand identity, the services you offer, and how to contact you.
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- Build a skilled team: When you know what digital marketing companies do, it’s easy to understand why employing a talented team is a crucial part of delivering value to your clients. Whether you decide to work with freelancers or hire full-time employees, finding experts who complement your strengths can help to elevate your agency.
- Establish an online presence: Setting up and managing social media accounts and your own website is a must when launching your digital marketing agency. A strong online presence can help you establish your brand, engage your target audience, and ultimately win more accounts.
- Invest in the right tools: The best digital marketing tools for agencies can optimize your performance. Whether you need project management software, a reliable CRM system, or a finance and invoice builder, investing in the right tools helps you to deliver high-quality results.
- Network and build relationships: Networking is a key skill for business leaders. By building relationships with industry peers, collaborators, and potential clients, you’ll increase both your support system and growth opportunities.
So, what are digital marketing agencies? And what makes the best of them so successful?
They’re hubs of online channel expertise, strategic thinking, and creative solutions that offer vital services to businesses around the world — and aren’t afraid to market themselves in the process!
As more marketing spending shifts to online channels, digital marketing agencies are in high demand. Offering options from SEO and social media management to email marketing and PPC, as well as various structures, they provide a flexible option for anyone who wants to structure a company in their own way.
Whether you’re a freelancer who is looking into scaling a digital agency, or a complete beginner, the online marketing world is full of opportunities. If you’re ready to take the leap, you can build a thriving and competitive agency with the right strategy and support.
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