How to start a social media marketing agency in 2024: 

1. Acquire in-depth knowledge on starting a social media marketing agency.
2. Focus on a profitable SMMA niche.
3. Make a list of your SMMA service offerings.
4. Set the pricing for your SMMA services.
5. Make a comprehensive SMMA business plan.
6. Build a multi-skilled SMMA team.
7. Find high-value clients.
8. Use the latest SMMA technologies.
9. Track your progress and optimize accordingly.

Many Redditors mention that starting a social media marketing agency entails creating a solid online presence. You can do this by implementing dynamic engagement strategies. Another way is through creating high-quality content and a unique selling point. Providing value to your target audience means establishing authority. This way, you can boost your social media profile and social proof. You also need to conduct competitor analysis and monitor your performance metrics. This allows you to get ahead of existing competitors.

Consumers worldwide are maximizing social media platforms to purchase different products and services. Some examples include Instagram, Facebook, and TikTok. In fact, DataReportal’s insights show that 61.4% of the world’s population are social media users. That’s 4.95 billion potential customers. This is also the main reason aspiring business owners and online entrepreneurs start a social media marketing agency.

Potential clients will flock to social media platforms with many active users. Kepios and Meta’s investor earnings announcements revealed that Facebook currently has 3.030 billion monthly active users. According to a Redditor, there is no shortage of new businesses popping up. Having this amount of target audience can change a brand’s potential sales.

However, breaking into this saturated market takes experience. Quora user Burak Berber said that beginners in this industry need to exert more effort. They must adapt to evolving algorithm updates. This way, they can keep up with the competition and changing industry demands.

This article ventures into the steps on how to start a social media marketing agency in 2024. We will talk about SMMA's skill requirements and common challenges. Plus, we'll also feature a less complicated business model that offers unlimited income.

1. Acquire In-Depth Knowledge on Starting a Social Media Marketing Agency.

The first step to starting a social media marketing business is acquiring in-depth knowledge of the business model. It also includes its market and how the advertising process works. You need to understand the factors that affect consumer behavior and market demand. As stated in Belle Wong’s Forbes article and data from Backlinko, an average person spends 145 minutes daily on social media. That’s why learning what keeps your target audience engaged is crucial. You can create dynamic social media management strategies. This boosts consumer engagement and attracts prospective clients.

As a social media marketing agency, it’s crucial to seek high-value but affordable resources. Rock Content suggests subscribing to the TL;DR Marketing social media newsletter, Social Media Examiner, or other reputable organizations. Ryan Scott’s article on HubSpot recommends diving into social media marketing blogs, videos, podcasts, slideshows, and books. Some examples include:

• Scott Monty (blog)
• Social Media Marketing Foundations (video)
• The Social Toolkit (podcast)
• The B2B Social Media Palette (slideshow)
• The Art of Social Media: Power Tips for Power Users by Guy Kawasaki (book).

These resources will help you gain the business model’s foundational knowledge. It allows you to choose a high-performing, lucrative niche.

2. Focus on a Profitable SMMA Niche.

Focusing on a profitable niche lets you make a stable and scalable income. You can do this through popular and high-converting social media campaigns. Choose niches with brands that are eager to augment their social media presence. According to Deian Isac, the most profitable niches as of August 2023 are remodeling, luxury watches, car customization, cosmetic surgery, and spiritual retreats. However, these SMMA business model niches aren’t fixed. Agency owners need to identify and research performant niches continuously.

A Redditor mentioned that local niches are the way to go for SMMAs. You get less competition. Plus, local businesses are likely to engage with local agencies. This way, you help your local community while securing long-term clients.

3. Make a List of Your SMMA Service Offerings.

You need to list the social media marketing services you will offer to your ideal clients. It’s easier to promote services that offer lots of benefits. Thrive Internet Marketing Agency’s blog states that the right SMMA business services provide high search engine rankings, online exposure, and customer reach. It also offers enhanced customer trust and increased profitability. This step entails balancing the services you’re good at, the popular ones, and the ones you can do alone and with a team. If you plan on starting a social media marketing agency alone, consider one to three social media services that aren’t too technical. If you plan to form a team, you can do more than three services.

This also depends on your team member's skills and the social media platforms you'll use. DataReportal reveals that Facebook, YouTube, and WhatsApp are the most used platforms globally. Let’s say you decide to focus on Facebook. A Hootsuite article states that PPC advertising, influencer marketing, and SEO are the best marketing services to deploy on this platform. It's important to tailor your services based on your skills and chosen platforms.

Here are some examples of famous social media marketing services:

• Content Marketing/Content Creation
• Website Design/Development
• Video Production/Marketing
• Email Marketing
• Link Building
• Conversion Rate Optimization (CRO)
• ADA Compliance Services

4. Set the Pricing for Your SMMA Services.

Setting the price for your social media marketing services considers your expertise. It also includes competitor pricing, potential client needs, and market demand. You can do hourly, performance-based, or project-based. Others use a tiered package or standard pricing with service add-ons. According to the latest data from MixBloom and Upwork, the average hourly rate for social media management is $15 to $250 (for freelancers) and $600 to $15,000 monthly (for agencies). The social media platform you use is also a deciding factor. Clutch’s article reveals that channel-based advertising costs around $25-$49 per hour. SociNova’s pricing is a good example of a tiered package.

One of the most common pricing is the tiered packages. Some social media managers or agencies offer a package set like this:

• Basic Package (social media marketing + basic edits)
• Gold Package (social media marketing + edits + content optimization)
• Platinum Package (social media marketing + edits + content optimization + keyword research)

This Reddit user suggests considering the potential revenue you can generate for your clients as the basis for your pricing. The more value you can offer, the higher your service prices will be. He said that basing it on deliverables isn't a good strategy. This is because most social media marketing agency owners have the same packages.

Tailor your pricing schedule to the social media campaigns you intend to offer. The more technical a service is, the higher its cost will be. For example, basic content writing is easier than Search Engine Optimization and PPC advertising. So, your SEO and PPC advertising services should be priced higher.

5. Make a Comprehensive SMMA Business Plan.

You must create an SMMA business plan to organize your financial, marketing, and operational procedures. SWELLEnterprise states that this helps with branding. It also simplifies target market identification, engagement, and service optimization. It’s an SMMA blueprint that will serve as your success roadmap. It's also a guide for upgrading your business or tackling common issues. According to Mark Henricks, there’s a 30% chance of higher sales growth with a strategic business plan. It lets you craft a dynamic social media strategy and improve your social proof.

Data from Excellent Business Plans and Small Business Trends reveal that 50% of international or local social media marketing agencies fail within five years. This highlights the importance of developing one. Wyclife Opondo’s LinkedIn article also concurs with this idea. It states that a business plan helps in goal setting and resource allocation. Plus, performance evaluation, and strategy development. It also guides you in picking team members or employees with specific skills.

6. Build a Multi-Skilled SMMA Team.

Build a team of skilled individuals for your social media marketing agency. People with a mix of soft and technical skills are valuable to your SMMA business. Soft skills are skills that cannot be measured. This includes creativity, communication, and strategic thinking. Katrina Kirsch’s article lists down key technical or hard skills. It includes SEO, Instagram marketing, campaign management, and influencer marketing. Plus, other skills like ad targeting, A/B testing, email marketing, and copywriting.

If you decide to start a social media marketing agency alone, make sure you know how to engage with brands. You need to deliver high-quality services and drive online conversions and brand awareness. You need a mix of these skills to create better, more engaging social media campaigns. This way, you can venture into various social media channels. It also allows you to expand your service offerings as your SMMA grows and acquires more clients.

7. Find High-Value Clients.

Finding high-value clients requires connecting with brands and networking with business owners. You can also talk to your friends and family. This lets you spread the word that you have started a social media marketing agency. Kyra Goodman offers a different strategy in her article on Sked Social. She says you can offer complimentary social media audits. Or, you can invite potential new clients to a short social media training. These creative ways of prospecting will help you entice your target market.

Anil Salvi also mentions the best methods for getting clients. This involves cold email outreach, social media, and business partnerships. Quora user Tohin Ahmed Shohag suggests doing inbound and outbound marketing. Inbound marketing helps you attract organic traffic. You can do this by creating high-quality content. Outbound marketing entails reaching out to potential clients. Some popular examples include cold calling and email marketing. All these approaches can help you attract prospective clients. What matters is your marketing strategy.

You must be creative in developing the perfect complimentary service offer. You can use technologies and platforms to streamline your client acquisition process. Some examples include Eventbrite (event management) and Fiverr (finding clients).

How To Get Clients for Social Media Marketing?

These are some of the most popular methods on how to get clients for social media marketing. 

8. Use the Latest SMMA Technologies.

You must maximize the latest technologies to simplify and automate your business. Christina Newberry’s article on Hootsuite divides these tools into different functions. This includes scheduling, analytics, monitoring, reporting, automation, engagement, customer service, chatbots, and platform-specific. Paid advertisements like Facebook Ads and Google Ads are also well-known platforms. They are used for broadening the reach of your online campaigns. Unbounce reveals that PPC is 50% more effective in converting customers than organic site traffic. That’s why you need to learn to use different social media marketing tools and platforms.

Here are other examples of popular social media marketing agency tools and technologies:

• SocialPilot (scheduling)
• Buzz Sumo (analytics)
• Keyhole (monitoring and reporting)
• Buffer (automation)
• Khoros (engagement)
• Zendesk (customer service)

9. Track Your Progress and Optimize Accordingly.

The last step to starting a social media marketing agency is tracking your progress. You also need to optimize your performance accordingly. Social media analytics is one of the most important factors you must put in place. It lets you check your social media campaigns and agency’s performance. Use social media analysis tools like Google Analytics, Sprout Social, and HubSpot. According to a Hootsuite article, you need to consider these Key Performance Indicators (KPIs):

• Engagement rate
• Reach
• Impressions
• Audience growth rate
• Click-through rate
• Conversion rate
• Cost per click
• Average response time
• Customer satisfaction score

These metrics are important for a social media marketer or agency owner. Monitoring these KPIs will help you adjust your marketing strategies. It also enables you to create campaigns that perform and convert. Having real-time insights into your social media marketing agency’s performance is crucial. It will make tackling common challenges easier.

What are the Requirements for Starting a Social Media Marketing Agency?

Knowledge of social media marketing, a business plan, permits and licenses, and tax considerations are the requirements for starting a social media marketing agency. You also need enough budget to do preliminary advertising. Plus, you need money to use and maintain SMMA tools. Quora user Tom Hespos also mentioned three important requirements. You need a good name, a website or a social media account, and a pipeline strategy. These are essential in building your social media marketing agency.

This Redditor mentioned five key permits and licenses needed for an SMMA. You'll need a national marketing permit, social media competency test, and an influencer license. You also need to secure a Certificate for Running Ads Publicly and a Content Creation Certification.

You also need to have key social media advertising skills. This lets you produce high-quality outputs. These requirements are essential to creating a legal, high-performing SMMA business.

What are the Essential Skills Needed To Start a Social Media Marketing Agency?

Writing, research, customer service, SEO, creativity, data analytics, and budgeting are the essential skills needed to start a social media marketing agency, according to the Digital Marketing Institute. These basic skills will help you create engaging and updated social media campaigns. You must also hone your skills in using different social media tools. Tailwind, Sendible, and Brandwatch allow you to speed up your marketing tasks.

How Much Does It Cost To Start a Social Media Marketing Agency?

It costs around $12,272 to start a social media marketing agency, according to Pat Walls, founder of Starter Story. It starts at $100 and can go up to $29,100. This cost estimate includes business formation, software, employee, website, and advertising costs. You can choose the most cost-effective way of starting an agency. You can opt to do everything yourself and use free online tools.

Can You Start a Social Media Marketing Agency With No Experience?

Yes, you can start a social media marketing agency with no experience, given you have the basic skills. Having knowledge and strategies of the business model is also helpful. According to Abhiyan Limbu, the key to building a successful SMMA business is implementing a step-by-step process of what you need to do. It’s also advisable to join social media marketing groups and exclusive communities. This lets you gather valuable information on the latest trends. You can also get information on consumer behavior and market demands.

Many Reddit users mention getting an internship. You can apply to well-known social media marketing companies. This lets you get ample experience to jump-start your SMMA journey. It also allows you to adopt unique industry strategies and techniques.

SMMA training is useful for starting your social media marketing agency because you get to learn unique techniques and insights from different coaches and trainers. Each of these SMMA workshops has different focus points. Some focus on popular social channels. Some go in-depth into engaging your potential customers. Other aspiring SMMA owners join social media marketing agency courses. A popular example is Daniel Thomas' Udemy classes. Other examples include Hootsuite Academy, PPC University, and Social Media Marketing Masterclass.

4 Common Challenges To Consider When Starting a Social Media Marketing Agency

How To Overcome the Challenges of Starting a Social Media Marketing Agency?

It’s crucial to prepare yourself for any potential drawbacks. According to Score.org, 77% of brands internationally use social media to reach their target consumers. That's why you need to learn the core concepts of SMMA. Acquire foundational knowledge, best practices, and the latest strategies for social media marketing.

You can build your business portfolio by offering free trials to local businesses. This involves creating free social media captions, video campaigns or reels, and graphics. You can also run social media giveaways to generate leads through friendly contests. Some examples include “Tag a Friend”, “Refer a Friend”, or “Follow To Win”.

Can You Make Money With a Social Media Marketing Agency in 2024?

Yes, you can make money with a social media marketing agency in 2024 if you can continuously acquire new clients and retain existing ones. A social media marketing agency is profitable, given that you make over 50% in profit margins. Data from Agency Analytics show that social media marketing agencies earn around $1,500 to $25,000 monthly per client. You can increase this amount by acquiring more long-term clients.

How Does SMMA Compare to Other Online Business Models? 

SMMA vs Copywriting

When comparing SMMA vs copywriting, social media marketing typically requires more expertise with visual communication, while copywriting requires high level written communication skills. Both business models typically have good profits margins. A copywriting business can achieve profit margins between 15% to 50%+, according to FinModelsLab.

SMMA vs Dropshipping 

When comparing SMMA vs dropshipping, social media marketing is a digital marketing business model, while dropshipping is an e-commerce business model. A social media marketing business offers services, while a dropshipping business sells products. Both SMMA and dropshipping can have incredibly low startup cost requirements. You can start both business models for as little as $100. 

Start a Profitable Business in 2024: Choose Local Lead Generation

A social media marketing agency is in high demand nowadays, but local lead generation will remain a profitable, scalable, and more in-demand business model in 2024 and beyond. Starting an SMMA business requires extensive industry knowledge and technical skills. Sure, you can succeed. But, scaling your social media marketing agency will take significant time and effort. This is because of the high barrier to entry.

According to DataReportal, consumers use 6-7 social media platforms globally each month. And because they spend around 2 hours and 25 minutes browsing posts and feeds, marketers take this opportunity to launch compelling campaigns. This highlights the cutthroat competition that social media marketing agencies are facing. You also need to address the high maintenance for multiple advertising campaigns. You generate low profits for massive work hours. Plus, you can easily lose clients at any time. It gives you less control over the potential income you can make.

On the brighter side, local lead generation isn’t as crowded as SMMA because you deal with local niches. It’s also easy to start. First, you must build a microsite for lucrative, high-demand local service niches. Then, generate engaging, relevant content that ranks high on search engines like Google. Once you’re ranked, free leads will message you from time to time. You can then forward these leads to local businesses in need of customers. You not only earn around $10K for each lead gen site, but you also get to own digital assets in the form of websites.

If you’re an aspiring online business owner who wants to earn more than $50,000 in passive income monthly, then a lead gen biz is definitely for you.