Exploring the Cost-Benefits of Using a Digital Media Agency

October 18, 2022

By Melissa Sierra

Your business has marketing needs. Digital media is the focus and marketing has so many variables to consider. Considering whether or not it is beneficial to use a digital media agency can be overwhelming. One of the most asked questions might be whether outside media agencies are cost-effective and if there is more benefit to using an in-house client? However, the answer is dependent on several factors and variables.

USIM explores a variety of situations and scenarios in which certain companies benefit from using a media agency and what to look for or consider when choosing one.

How Do Media Agencies Help You?

Media agencies fulfill several roles when helping businesses meet their digital marketing goals and secure their online branding.

These roles include:

• Social media marketing
• Search engine optimization (SEO)
• Website design and copy
• E-commerce listings

An agency can also solve a variety of problems for organizations, such as:

• Investment of time and resources
• Varied professionals with a large knowledge base
• Access to licenses and subscriptions
• Relationships with channels and stations
• Understanding of various niches and channels
• Optimization of portfolios

 Digital marketing can take up a lot of resources for a business. When entrepreneurs dedicate a majority of their time and resources into each campaign, the rest of their business may become neglected. Instead of executing the marketing in-house, it often makes sense to hire a team filled with designers, copywriters, editors, animators, and PR professionals to take on the tasks it takes to be a successful business.

Working on each marketing project independently means putting a significant amount of effort into hiring various professionals, researching trends, reaching out to a myriad of channels, and altering ads based on performance (or lack thereof).

Digital marketing agencies focus on one matter: digital marketing. They offer turn-key packages with the opportunity to individualize what is needed and align the product with the company vision. Since this is their sole focus, they can complete projects in record time without sacrificing quality.

Stability During Trying Times

The economy is not always predictable and can become unstable at any time. Working with an agency provides security during an economic decline. Freelancers or small startup agencies could fold under the financial pressure of an economic downturn. However, a well-established agency has the resources and efficiency to hold strong, even in a time of uncertainty.  

These established agencies also have the experience to know how to market during a recession, as well. People are always going to spend money, regardless of an economic downturn. A recession simply changes when, where, and why. Most vetted agencies have professionals on staff who have worked through recession times, crucial to keeping a business afloat amidst the next one.

Training, Education, and Attention

The agency hired is responsible for hiring marketers and keeping them up to date with the most successful trends. They can handle all of the recruiting, onboarding, and training or education of a team on a business or product without having to start from the ground up each time. The agency chosen manages recruiting, onboarding, and education of their teams to ensure the best possible professionals work on your projects and includes letting their employees go and educating them based on their agency expectations.

Media agencies provide specialized attention from an entire group of career digital marketers. The team from these agencies wouldn’t be freelancers trying their hand at a new hobby; they’re dedicated professionals who tailor every project based on all the knowledge they’ve gained through years or decades in the field.

Digital marketing agencies also leverage their client load by giving you access to certain subscriptions and licensing fees that would be insurmountable on your own. Most agencies have resources and tools that you either don’t know about or don’t have the funding to access without them.

Agencies can also keep up their education/training across all fields of branding while staying competitive in their field. They need to know what’s going on across all industries and what clients are looking for. This is a huge ask for a freelancer or contractor. However, an agency filled with experienced marketers have the resources to task employees with staying ahead of the power curve.

Technological Considerations

Many digital marketing agencies also focus on technology marketing. This helps many organizations focus on data-driven results or specific ROI numbers. These agencies know how to analyze the channels that work best for particular ROAS, KPIs, and conversions. Furthermore, they’re skilled at balancing multiple KPIs across the brand to keep up with client demand. 

Large-scale agencies have the access to:

• subscriptions and licensing tools for metrics and KPIs
• collaboration software and project management tools to track campaigns
• catalog images
• share content
• edit copy
• ensure seamless communication throughout all levels

Digital marketing agencies work with dozens of clients at a time. This gives them a hefty budget in their industry for research and data. This cost is leveraged among all the clients, saving you a significant portion when compared to a freelancer or a small firm. This is particularly helpful with expensive DMAs. 

Constant Creativity

There is a benefit to looking at something with a set of fresh eyes. Even when it’s as simple as doing a puzzle or solving a difficult math problem—taking a break and coming back to it often makes the solution jump right out. Hiring a digital marketing team gives you this “fresh eyes” approach and benefit for each campaign. Not only that, but the business itself, saves money and time without having to train people in specific—yet ever-changing—areas of marketing.

An outside team isn’t closely connected to your company, but they do get to know your brand or business in the process. One of the benefits of working with an agency is the ability for an outside team to take an organization’s mission and vision and tailor their strategies to a business or brand’s needs at hand. A team that considers a company’s needs for marketing a fresh spin can to make a campaign truly memorable.

Community Connections

Another area in which agencies can save money for a business is through rate negotiations. Many large-scale agencies get deals and discounts when placing ads on radio and television stations. Stations know the caliber of ads they’ll receive from experienced marketing organizations; they want good commercials on their station so that consumers don’t lose interest. Agencies are also skilled at creating effective ads for a small amount of space or time or to hook a particular market for a certain station.

More importantly, a media agency can save time. Instead of reaching out and trying to get your ad(s) into the hands of every potential consumer, this is often built into the package an agency can provide. This saves a significant amount of time and money rather than dealing with each station directly. 

Niche Marketing

Creating effective ads isn’t always about creating the most memorable ad, either. Even the most creative, catchy ads can fall flat if they aren’t placed in front of the correct target audience. Since  most of the advertising now takes place online, this market is incredibly saturated. An agency can ensure ads aren’t blocked or overlooked because they’re drowning in a sea of similar voices.

When ads aren’t correctly placed in the right space or platform, it creates many opportunities for wasted money and missed potential revenue. Implying that quality is more important than quantity - this often means including a range of ads that are tailored to particular targets. One-size-fits-all campaigns lose the majority of those who see them because every demographic or population has specific needs or interests.

Digital marketing agencies take care of the quantity problem, too, however. They reduce ad waste through AI-based machine learnings that are built to optimize media in all stages of the campaign. The kind of technology an agency can provide tracks trends and customer pain points before the campaign is constructed to make sure the ads are optimized. It keeps going during the time the ads run to determine if anything needs adjustment. The AI metrics are utilized afterward to run numbers determining success, which are used for future projects.

Optimizing Your Portfolio with the Right Tools

It is important to find an agency that will help diversify your marketing portfolio. Each placed ad has specific considerations. For example, content marketing and native advertising require meticulous creation. In social media campaigns, the platform’s aesthetics are of utmost importance. Written ad copy must adapt to the audience and be well-written and error-free at the same time.

Again, this requires an experienced team of professionals who have the time, energy, and bandwidth to manage every one of these expectations. Digital marketing agencies have large libraries of assets and resources to ensure that all these necessities receive adequate attention.

The Right Focus on Metrics

Numbers and metrics prove to be valuable to analyze campaign productivity. However, taking the numbers and turning them into actionable steps is another skill of importance when getting the most from your marketing and advertising budget. It’s important to use tools that maintain integrity and appropriateness for these campaign goals so that they are correctly identified to maximize advertising efforts.

Digital marketing agencies use specific metrics to track ad-flow performance in every stage of advertising.

These agencies have the benefit of tools to measure areas such as:

• raw views
• consumer reactions
• lead and opportunity generation
• and long-term profits.

The organization’s goals, the target market, and the industry determine whether these numbers are valuable in real life, though.

For example, brand awareness and younger markets emphasize the need for a focus on likes, shares, and viral content. However, targeting affluent audiences requires marketing that lasts longer than a 15-seconds-of-fame TikTok ad. Direct marketers know how to apply the right ads to create purchase conversions from leads, which are important for sales teams’ numbers.

Then there’s the difference between content marketing and email campaigns. Content marketing requires professionals who know how to drive traffic and get SEO-based search results. Email campaigns must include specifics such as subject line catches and subscriptions.

Some programs might give you the numbers you ask for but don’t come from an honest marketing place. Decades ago, ads were placed in physical places and could be vouched for and seen for a specific time in a specific place. Now, many digital ads are here today and gone tomorrow in the vast network of the Internet, on which it’s impossible to track everything.

Additionally, ads are vouched for by the companies that profit from them, leading to dishonest agencies or practices that often place ads on unsanctioned or spoofed sites. Likes, shares, impressions, and other digital interactions are often created by fake bots, as well. Unfortunately, almost 25% of all Internet activity is done by AI. This makes it imperative to use independent analytics that monitor your ad traffic and pull verified statistics.

Performance measures and metrics are an important part of what a digital marketing agency can provide for your business. Assessing ROI helps a company understand whether investments are paying off. However, ensuring that the statistics you’re focusing on are directly aligned with business goals is of importance as well. Also, check that these numbers line up with the customers, profits, and revenue that you see in real life.

Cost Evaluations

The costs associated with digital marketing agencies aren’t small. However, expensive is a relative term. The term investment is a more accurate representation when hiring a digital marketing team.

Oftentimes, this route actually saves money as a long-term investment. The time, labor, salary, benefits, and creative power used when hiring each individual role can prevent the maximization of ROI within a business. If a person’s time and skills are better used specialized in a different scope, while paying them anyway, using an outside agency is quite possibly a better use of your funding.

Many businesses try to save money by using freelancers. Freelancers are often more flexible and work on only their time frame so they can offer some extra benefits. However, they usually charge by the hour, which adds up—especially with the changes and revisions that are almost always part of any big project.

Other companies choose to hire a few specialized people, even for the long term. Putting these people on the payroll means paying out for insurance premiums, retirement benefits, office space, and technical equipment creating a loss of marketing funds.

Digital marketing agencies don’t cost a business anything more than the project itself. Agencies pay their employees and stick to the schedule that you sign when the contract is negotiated. Their employees are specialists in the field, and you have the benefit of the entire agency at your disposal—not just one, two, or a handful of people.

Various Billing Structures

There are several different billing structures that digital marketing agencies use. Your company’s financial model and your needs factor into the type of company you want to work with.

• Hourly – New startup agencies often use an hourly billing structure because they are learning how long certain types of projects take. This way, they don’t get shortchanged, and you don’t get rushed work. There’s nothing wrong with a company that works this way—however one of the downsides to this structure is if a large number of revisions and edits is requested, it must be worked into the original contract so paying significantly more than budgeted isn’t an issue.

• By the Project – Many freelance designers charge per project. Some agencies use this type of structure as well, especially if they have contractors on staff. You benefit from a per-project plan because you can ask for as many changes as you’d like without needing to pay extra. This can get expensive, however, if a particular agency for many projects, it will be a beneficial investment.

• On Retainer – Similar to a lawyer who keep at the ready and are paid a small fee each month, hiring a digital marketing agency on retainer means that a company pays them a monthly stipend and can ask for as many projects as needed during that time.

• Recurring – These are great when expected to establish a relationship with your digital marketing agency. Recurring (usually annual) contracts often offer discounted or flexible pricing along with a long-term commitment. This saves money, too, if you know you’ll have plenty of needs over the coming years.

• Performance-Based – You see this with well-established companies that have an excellent reputation and a portfolio full of high-end projects. They name a price and businesses pay it, simply for the peace of mind and confidence that the company brings along.

• Value-Based/Commission – What will the company do for profits and revenue? Value-based companies set their price based on what they guarantee they’ll bring to the table. This is also found in well-reputed digital marketing agencies.

Choosing the Right Agency

There are plenty of questions to help decide and understand what company would benefit your business the best. Looking for who can offer you the cheapest package or get it done the fastest isn’t always the most important part of hiring an agency. Simply going with the name heard most often or who has the flashiest marketing themselves in the industry can hurt your profitability and long-term investment. Every company has specific, unique needs; the answers to these questions should line up perfectly with your expectations.

1. How do you achieve results? Do you use distinctive tools or processes? Does this change depend on the company or project?

• A highly capable digital marketing agency should have specific results-oriented strategies and tools. They can give examples of projects on where they’ve used each tool and/or process and give an idea of how they navigate specific industry changes for an organization’s unique goals. Don’t accept fluff language or conversation; if they can’t give you hard details, that’s not a great sign.

2. How do you approach your branding and marketing? What have you learned works well and what have you left behind?

• A marketing agency needs to be well-trained in marketing. You wouldn’t take tennis advice from someone who didn’t know how to give a solid backhand. The agency chosen should also be able to accurately articulate the reasons they chose to market themselves a particular way. You also want to work with a company that knows the value of growth and change; you aren’t looking for an answer of, “We’ve been great since the get-go and always knew what to do.”

3. How do you involve our in-house team? What do you require from us and how much input will our team members get to have?

• The correct answer to this question honestly depends on how much involvement you want to have as a business. If you know that your in-house creative team wants to be a part of the process and has unique, innovative ideas, then that shouldn’t be wasted just to pad the egos of an agency. However, if your staff is overwhelmed and you simply need to give their directors a vision and let them go, then you’ll look for an answer that allows you to be more hands-off.

4. What metrics do you use for success? What do your clients use? How often are your own KPIs run?

• Ask to see recent numbers. Are the metrics and tools aligned with your company’s needs and goals? Does the agency have the licensing and bandwidth for a variety of tools, and/or are they open to using other programs if you have something that you want to add to the portfolio?

5. What is the timeframe for project completion? What happens if this needs to be pushed?

• Every contract or project should have a projected completion date. Of course, real life comes into play, and sometimes deadlines are adjusted. It’s important to have a plan in place, though, so that you know your marketing is still a priority. Will you pay less if certain timelines aren’t met? Are there fine-line clauses in which the agency has the right to extend deadlines based on certain circumstances? Think about what is able to be negotiable.

6. When can we expect to see results?

• This is important if an agency that works on a value- or a commission-based system is chosen. These agencies often charge a flat fee and then take a percentage of earned revenue based on new metrics. Certain contracts have stipulations in which you have the right to request edits or adjustments if you don’t see the promised results.

7. What’s the price point? What services are included and is there potential for any extra charges? Are revisions and/or edits included in this package?

• Money talks. Think about the two ends of your budget spectrum: what is ideal to spend and what you would be willing/able to spend. Ideally, this cost will land somewhere in the middle. This amount must comprise everything needed, or it won’t be a solid investment. Make sure that flexible situations are accounted for as well; adjustments are bound to pop up. Signing a contract that maxes out a budget just to have surprise charges before delivery of the final project will significantly affect your ROI.

8. What are some projects that haven’t gone well for you, or clients who weren’t satisfied? How did you remediate these situations? What would you do differently if you could work on that project again?

• This might seem like an uncomfortable question to be asked (and for an agency to answer). The reality is, that there isn’t a single organization out there that hasn’t experienced failure. Failure teaches important lessons, and you want to align yourself with a company that knows how to get back up, brush off, and push forward coming out improved as an agency from the experience.

Consider these tips, too, before shaking hands and signing documents.

Reach Out to Past Clients and Read Testimonials

This is one of the best ways to get a true feel for how a company treats its clients. Seek out reviews and testimonials wherever possible. Then, reach out to a variety of past customers, especially ones in your field. Did they feel listened to? Was their vision executed? Did the agency stay true to the agreed-upon timeline and budget?

Does the Website Mesh with the In-Person Vibe?

Steer clear of a marketing agency whose website leaves a lot to be desired. If they can’t market themselves, how are they going to market your business? Make sure that all the details a potential client would need are there, and that information is easily accessible.

Take that one step further and confirm that what the website says is also what you’re going to get when meeting with the company in person or over the phone. It‘s not in any company’s best interest to make a decision based on a beautiful first impression, only to find that those currently working for the organization can’t back it up.

Beware of Red Flags

Intuition is key. Don’t ignore it! If an agency makes over-the-top promises, seems spammy or over-agreeable, or flakes out on your initial communication… run! There are plenty of well-established, highly valuable, forward-driven companies out there. Settling isn’t an option.

Birds of a Feather

You’re likely going to work very closely with this agency—possibly for years and years. Do you like them? Do you get excited about your conversations? Would you want to spend time with these professionals outside of your working relationship? It’s important to establish compatibility and solid communication. These are the foundations of a successful partnership.

Feel free to ask for a trial run. Most agencies have a few levels of timeframe commitments. Choose the shortest one, and then when that’s over, think about whether you’re looking forward to continuing or if you need to part ways.

The Tipping Point

It is always important to save money within a business. Specialized attention toward the projects that are crucial to your brand and online presence is imperative when thinking about this long-standing investment. Completed project on a strict timeline and the ability to ask for changes before a final product hits the internet is a crucial part in a business and agency relationship. When considering an agency, it is important to have creative freedom and access to all the latest tools to ensure that your ads are getting into the right eyes and ears.

Once something that checks all these boxes is found, that’s when an official decision on whether using an in-house client or if using a digital media agency to plan out your future digital marketing is the right choice for your business.

How Can USIM Reach your Goals? 

USIM’s digital team has found success executing campaigns for multiple brands. Our team takes into consideration all best practices while applying a nuanced approach for each advertiser based on their budget, flighting, objectives, and assets. 

When working with USIM to plan and activate, our team provides high-level direction on creative in addition to recommendations for each campaign. 

For more information on how USIM can help optimize your marketing strategy, connect with your individual planning team to discuss next steps.