It is worth it to start a digital marketing agency in 2025 because:
1. Digital marketing is in demand.
2. Digital marketing agencies produce recurring income streams.
3. You'll have full control over your digital marketing business.
4. Digital marketing agencies cost less than physical agencies.
5. AI increases your digital marketing efficiency.
6. Digital marketing agencies have a diverse client base.
7. You can start doing digital marketing without a lot of experience.
Starting a digital marketing agency is hard work. So you'll also need to be passionate about helping businesses grow. Yet, even if you're dedicated to sales, networking, and staying up on the latest business tactics, you need to weigh its pros and cons:
Digital Marketing Agency Pros
Initial investment costs $1,800 to over $16,000.
You may start an agency on your own and add team members as you scale up.
Digital marketing services often command profit margins of 15% to 25%.
A digital marketing agency allows you to work remotely while serving international clients.
The growing industry for digital marketing creates steady opportunities.
Digital Marketing Agency Cons
Compete with established agencies will be hard for industry beginners.
Digital marketing results take time, but clients often expect them fast.
Changes on algorithm, platforms, and marketing trends require ongoing learning.
Irregular income and delayed payments may discourage new digital agency owners.
Frequent client switching demands constant prospecting and marketing.
Digital marketing is a highly competitive field. As an industry newbie, attracting clients is a struggle. This is why most experts recommend niching down if you want to start your own agency. One Reddit user shares about how focusing on a specific niche works for your advantage.
Also, achieving longevity as a digital marketing agency requires passion. At times, you will be dealing with difficult clients. Some will complain and get impatient with how long it is taking to get results. You will need to exercise ongoing, positive reframing conversations to keep your clients. An agency owner on Reddit says it's important to enjoy digital marketing work. The post reminds that running an agency will consume a significant part of your life.
On YouTube, Jason Wardrop says an agency is worth starting if you have a 3- to 5-year plan. “If you're fully committed, you could easily make 7 figures and even 8 figures,” he says in a video. According to the digital marketing expert, short-term thinking often leads to burnout and failure.
Jake Hundley, CEO of Evergrow Marketing, says those who want to succeed have to be willing to invest time. “I would get off of my day job and work for another 7-8 hours until 1am building websites and managing SEO/PPC campaigns,” he shares on Reddit. Today, his typical work day starts around 10am and ends at about5 pm. According to him, the agency is set to reach $500k in gross profit this year.
In some cases, being a digital marketing agency owner requires working beyond 40 hours per week. Haydon Churchill of PPC agency SERPWARS talks about working 80 hours per week as a beginner. Although that has decreased to 40 hours or so each week, he admits he's “still doing business related things pretty much 24/7.”
It’s not worth starting a digital marketing agency if you don’t have any relevant experience. Hiring employees or freelancers will not be enough. Owning an agency requires more than managing projects and attracting new clients. You need digital marketing skills and industry knowledge.
Case in point, a digital marketing agency owner on Reddit responds to a plumber asking if they should start a digital marketing agency. The post goes to emphasize that no business is likely to pay someone without experience in the field. Not when there are plenty of digital marketers with proven track records out there.
A digital marketing agency also isn’t the right business model for those who dislike change. You need to be ready to adapt to industry changes, such as Google algorithm updates. You'll also to learn new marketing channels and technology innovations. Finally, you also need strong sales skills to sell your services to potential clients.
As an online entrepreneur since 2014, I know digital marketing is challenging. I've tried various online businesses, but have since stuck with a model that's easier to scale. In fact, I earn up to $52,000 per month providing service to small business owners.
We show you 7 reasons why starting a digital marketing agency is worth it. Plus, we explore the main difficulties and which courses are best in the market.
1. Digital Marketing is in Demand in 2025.
Digital marketing is in demand in 2025 as more and more businesses are being done online. The industry's growth is fueled by the increasing number of people turning to online platforms for products and services. This surge in web-based activity has transformed how companies interact with potential customers. As such, businesses require the services of an expert digital marketer. With the right marketing campaign, brands stay relevant, reach a bigger audience, and generate higher profits.
As a career choice, starting a digital marketing business remains promising. Today, companies hire big and small digital agencies for their campaign initiatives. The increasing reliance of businesses on online platforms creates a steady demand for skilled digital marketers. According to Workswit IT Solutions, about 60% of small businesses use digital marketing, investing in:
Meanwhile, Forbes says digital marketing is “one of the fastest growing in-demand skills.” In fact, it ranks among Coursera's top 10 Job Skills of 2024. The report says digital marketing professions will see a “6% increase in growth - higher than the average job growth rate - by 2032.”
2. A Digital Marketing Agency Produces a Recurring Income Stream.
A digital marketing agency produces a recurring income stream for online entrepreneurs. This is done by retaining existing clients and acquiring new ones. As a result, digital marketing agency owners create consistent income.
Starting your own digital marketing agency means an average earning of $10,000 per month or $250,000 per year. Experienced marketing business owners potentially reach six-figure earnings. Overall, the revenue potential depends on the services offered and the size of the team.
In an UpFlip interview, Eric Siu shared about purchasing a failing SEO agency for $2. He eventually managed to turn things around and now Single Grain is a $14 million business.
On Reddit, Moxie_Mike says their digital marketing service agency's client relationships are “all retainer based.” Most clients have been with them for at least 6 years or more.
“Our retainers start at $2k/mo but most clients are higher than that,” writes the Reddit user. “So in terms of predictable, recurring revenue, it pretty much checks all the boxes.”
3. You Have Full Control Over Your Digital Marketing Business.
As an owner, you control most aspects of your digital marketing business, such as:
You allocate your time, money, energy, and resources to high-return campaigns. Likewise, you decide to scale your business at your own pace.
Reddit user rearviewmirror71 says running a digital marketing agency has several perks. Being your own boss means you're in control of:
“I don't have to answer to anyone. I work with my clients, not for them,” the marketing agency owner says. “Going into meetings with this mentality has actually helped me land more deals.”
4. A Digital Marketing Agency Costs Less Than a Physical Agency.
Starting a digital marketing agency costs lower than a physical agency. It costs $1,800 to over $16,000 to start a digital marketing business. Costs depend on the types of services you want to provide and the technology you'll use. Start-up costs will be higher if you want to hire a team and have an office. In most cases, you sell your marketing services online and run your agency remotely. Also, you start small with only 1-2 services. Then as you build a client base, consider scaling.
Mike Mancini of Mancini Digital says even businesses with small budgets lead to significant returns. In a YouTube video, Mike says his digital advertising business outsources to overseas specialists. The reduced labor costs allow him to earn higher profits. In total, Mike says it's possible for an agency to reach a monthly and yearly profit margin of up to 92%.
On average, profit margins for digital marketing agencies range from 15% to 25%. Earnings may be higher or lower, depending on the company's size, service specialization, customer base, and pricing model.
Agencies usually implement different pricing models, such as:
- Hourly rate pricing model. Hourly is a model where the agency charges clients a set price per hour. The model is easy to implement. But an agency needs to get results or risk losing clients' trust and business.
- Project-based pricing model. An agency estimates how much a project will cost by calculating the estimated number of hours multiplied by how long it will take to complete. Project-based pricing is a great option for clients on a budget.
- Value-based pricing model. The focus of this model is on value. As an agency owner, you should have a solid track record to support your claims and make money with this model.
- Performance-based pricing model. In this pricing model, expectations and KPIs need to be clear. Goals should be measurable and agreed upon before the work starts. But if an agency can't achieve results, it won't earn an income using performance-based pricing.
5. AI Increases Your Digital Marketing Operational Efficiency.
Artificial intelligence increases the efficiency of your digital marketing agency. According to an AppNexus survey, 86% of digital marketers use AI to improve efficiency. Most operations and tasks is streamlined using new technology, including:
A Reddit post by surfer808 shows us how they used AI for the past 2 years. According to the online marketing business owner, AI helps in data analysis and strategy formulation. In addition, its also useful for content creation and customization. Some tools they use are Claude 3, ChatGPT 4 turbo, and Gemini.
Meanwhile, other industry trends in digital marketing for 2025 include:
6. Digital Marketing Agencies Have a Diverse Client Base.
Digital marketing agencies have a diverse client base and serve almost any industry. In most cases, your customers will be small to medium sized businesses (SMBs) and startups. You are not dependent on any single market and you choose your target market and ideal client base.
Some of the profitable markets to focus on are:
7. You Don’t Need a Lot of Experience To Start a Digital Marketing Business.
Starting a digital marketing agency doesn't require a lot of experience. If you are willing to work hard and learn, it's possible to establish and grow your own marketing business. You start small and gain expertise in specific digital marketing services. You may also consider taking a digital marketing course to learn from industry experts.
Laurie Wang says agency newbies may check out online courses and YouTube videos. “Follow different thought leaders in the industry,” adds the self-taught marketer. “What we want to aim for is a nice general understanding of all the different various phases and channels on digital marketing.”
Of course, you may also outsource marketing tasks to virtual assistants. Tis lets you focus on the management aspects of the business.
Starting a Digital Marketing Agency: Pros and Cons
Pros
Low initial investment. Starting a digital marketing agency will cost you $1,800 to over $16,000, depending on the services you plan to offer.
Digital marketing agencies are scalable. It's possible to start as a solo entrepreneur. You may add team members and accommodate more clients as you grow the business.
Digital marketing agencies are profitable. Agencies earn profit margins of 15% to 25%. Some top performers even make as much as 30% to 40%.
Digital marketing agencies are location independent. Working from home is always an option. You may also choose to serve clients from different countries.
Digital marketing industry continues to grow. Statista reports that the US is the world's largest digital advertising market. In fact, 80% of the country's ad dollars go to digital advertising.
Cons
Digital marketing agencies face intense competition. IBISWorld reports there are over 54,000 digital advertising agencies in the US. Standing out requires industry expertise and strong niche positioning.
Digital marketing agencies deal with demanding customers. Most clients expect significant results within the first 3 months. However, most agencies only make meaningful impact by 6 to12 months. This is specifically true for running SEO and content marketing campaigns.
Digital marketing requires ongoing learning. Digital marketers often spend 5 to 10 hours per week to stay updated with algorithm and platform changes. Furthermore, agencies invest an average of $1,500 to $2,500 yearly for employee trainings and certifications.
Digital marketing agencies face cash flow challenges. Payment delays and revision requests are common problems. Most agencies have payment terms of Net 30 to 60 days.
Digital marketing agencies have high client turnover: Agencies must constantly prospect for clients as churn rates are high as 30% per year. Meanwhile, client acquisition typically takes 2-3 months from initial contact to signed contract.
Top Comments on Starting a Digital Marketing Agency
In a podcast interview, Alec Littlejohn shared about scaling Untapped Revenue to a 7-figure agency. He learned how to start a digital marketing business by specializing in the gym niche. His company faced significant challenges during COVID, losing 86% of its clients. However, he took immediate action and the business underwent restructuring. By 2023, they focused heavily on client retention. The move brought monthly recurring revenue growth from $4,000 to $61,000 within 12 months.
Xorivotech founder Ali Hasan says agency owners should define their niche and target market. It also means developing a business plan and establishing brand identity.
He also encourages marketers on Quora to:
“As you grow, focus on delivering exceptional results, nurturing client relationships, and continuously learning and adapting to industry trends and changes,” he adds.
Redditor pasyie says you should never start an agency unless they have “a steady list of clients.” In a post, the Redditor outlined their journey, describing how they went from being a freelancer to hiring a team member. “Never jump in head first without a steady income and some long term contracts,” the post points out.
Meanwhile, 4ucklehead tells marketers should have good presence on social media platforms. “If you're selling paid digital, then you should be able to successfully run paid digital campaigns for your agency,” says the small business owner. “Otherwise, why should I trust you to run mine?”
What are the Main Challenges of Starting a Digital Marketing Agency?
What are the Best Digital Marketing Courses for Starting an Agency?
The best digital marketing courses for starting a digital marketing agency are Freelancer to CEO by Suzy Crawford and ReviewPro Launchpad by Mike Schimdt. ReviewPro Launchpad is an online training course for marketing agencies, business owners, and freelancers. The 6-section program teaches digital marketers how to monetize reputation management services. It taps into a growing field where professionals earn an average annual salary of $65,367. Freelancer to CEO is a digital marketing course and coaching program that teaches freelancers how to become successful business owners. It focuses on enhancing client acquisition strategies and streamlining business operations. The program also discusses magnetic marketing, content marketing, digital marketing techniques, funnel optimization, and more.
Meanwhile, interested individuals may also check out digital marketing courses on YouTube. Some of the top digital marketing agency videos on the platform include:
Udemy also has over 15,000 free and paid courses that teach beginners how to run a digital marketing agency.
Is Digital Marketing in High Demand for the Future?
Digital marketing is in high demand in the future because most businesses rely on modern marketing methods. Companies today use social media, websites, email, and other online platforms to connect with audiences.
Reddit user Dry-Cartographer8583 says digital marketing continues to be lucrative today. The digital marketing director names email marketing, website management, SEO, and data as “skills that pay well.”
However, the industry continues to thrive. Navigating changing algorithms and staying ahead of emerging trends is tough. For example, data privacy concerns and ad blockers complicate targeted advertising.
Local Lead Gen vs a Digital Marketing Agency: Which is Better in 2025?
Local lead generation is better than starting a digital marketing agency in 2025. With local ead gen, you're building and ranking websites that produce leads. You own both prime digital real estate that bring passive earnings. Also, you're not working for clients but are providing service to local business owners.
In comparison, digital marketing agencies comes with several disadvantages. The market is competitive, with many established players offering similar services. Building a strong client base also requires time and is often difficult for new agency owners. It is hard to gain the trust of prospective customers if your agency doesn't have solid reviews.
With local lead generation, it's easy to attract clients as long as you show real results. For example, getting your sites to top search engine rankings does the trick. Business owners will know you deliver quality leads. They will be more willing to pay for your services.
Ranking a lead gen website costs around $500 and only requires at least 6 months of local SEO work. Once you reach top search engine ranking, you'll only need around 10 to 15 hours per year to maintain that. Your site will get free organic traffic and you may offer them to entrepreneurs who need leads. As a result, you potentially earn $500 to $3,000 per month from each site. This is exactly what I do now and since I own lead gen sites, I make a monthly passive income of up to $52,000.
