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Starting an Advertising Agency Business Online – A Complete Guide

Do you want to start an advertising agency online? If YES, here is a complete guide to starting an advertising agency business with NO money and no experience.

Okay, so we have provided you an in-depth sample advertising agency business plan template. We also took it further by analyzing and drafting a sample advertising agency marketing plan backed up by actionable guerrilla marketing ideas for advertising agencies. In this article, we will be considering all the requirements for starting an advertising agency business. So put on your entrepreneurial hat and let’s proceed.

Why Start an Advertising Agency Business Online?

If you are interested in the advertising industry, you can bet that there is no limit to the fortune you can make from the industry as long as you are creative and have good networking skills. If you are looking for a business to start as an entrepreneur with a PR and an advertising background, then you can consider starting your own advertising agency.

Before you can become an advertising practitioner, you must first write and pass advertising and PR exams and become certified. You can check up online to see the next date for all the media related professional exams in your country. The truth is that if you have a media background, it will make it easier for you to pass all the certification exams.

Although an advertising agency can be operated from home, especially if it is being managed by an individual, but it pays to operate from an office facility. The truth is that you would not need a large office space to be able to run this type of business. Just ensure that you secure an office decent enough to host the caliber of clients you will be dealing with. An office in the business district of your city might just be ideal for you – but all the same, you don’t need to go beyond your means to get a very expensive office space. It is advisable to start your business small and then grow it big.

Starting an Advertising Agency Business Online – A Complete Guide

  • Industry Overview

A standard advertising agency creates advertising campaigns for periodicals, newspapers, radio, TV and other media platforms such as the social media. Through internal capabilities or delegating, ad agencies provide advice, creative services, account management, production of advertising campaign materials and of course media planning and buying like ad placement et al.

Establishments in the advertising agencies industry are responsible for creating advertising campaigns and placing the advertisements in periodicals, newspapers, radio, TV and other media outlets such as social media and digital media platforms. The arrival of new media, (and in particular, with the trend moving away from traditional media and toward digital and online services), has stimulated a drastic change in advertising strategies.

As a matter of fact, loads of traditional advertising agencies have started to specialize in online advertising cum digital marketing so as to stay competitive in the industry. As a result of this trend, the revenue generated in the industry has grown tremendously over the years. Going forward, the advertising agencies industry will continue to experience sustained growth, as the proliferation of digital devices, such as tablets and smartphones, provide new streams of income.

No doubt, the advertising agencies industry is in the mature phase of its life cycle and luckily for the industry, the advent of digital media has provided an opportunity for the industry to explore and experience vibrant growth. Of course, the industry is becoming more concentrated, as seen by a few large global firms dominating the market and gaining huge market share of the available market.

The advertising agencies industry is indeed a very large industry and pretty much thriving in all parts of the world especially in developed countries such as United States of America, Canada, United Kingdom, Germany, Australia, France, Italy et al.

Statistics has it that in the United States of America alone, there are about 65,454 licensed and registered advertising agencies responsible for employing about 251,296 employees and the industry rakes in a whooping sum of $43 billion annually with an annual growth rate projected at 3.5 percent. It is important to state that the establishments with lion shares of the available market in this industry are The Omnicom Group Inc., WPP and IPG.

The advertising agencies industry will continue to blossom because more and more organizations are beginning to realize that somehow, they would need the services of advertising agencies to help them penetrate their target market and create the required brand awareness that will facilitate business growth and expansion. From all available statistics, it is safer to say that the industry is growing steadily despite the competitive nature of the industry.

Some of the factors that encourage entrepreneurs to start their own advertising agencies are that the business is easy to set up and the start-up capital is indeed affordable; you can actually start your own advertising agency business from the comfort of your house. All you need to do is to create an office somewhere in your house. People usually pay you for the result you can help them achieve as it relates to their marketing and publicity concerns.

Over and above, advertising agencies cannot be phased out despite the change in advertising approaches and the emergence of new media. It is easier for advertising agencies to leverage on modern technology to reach–out to their target market. As a matter of fact, it is cost effective and far reaching for them to make use of social media platforms to carry out some of their advertising campaigns.

Starting an Advertising Agency Business Online – Market Research and Feasibility Studies

  • Demographics and Psychographics

The demographic and psychographics composition of those who require the services of advertising agencies are not restricted to corporate organizations that are into sale of product and services, but also individuals who are also interested in promoting their image cum brand. For instance, you will notice that some celebrities and even politicians pump in money so as to enable them trend on the internet and in the heart of their target audience.

So, if you are looking towards defining the demographics for your advertising agency business, then you should make it all encompassing. It should include corporate organizations, political parties cum politicians, government agencies, celebrities, schools, NGOs and even religious organizations et al.

List of Niche ideas Within the Advertising Industry That You Can Specialize in

Most advertising agencies tend to operate a general advertising business that involves every business activities or services that a standard advertising agency is expected to offer. That is why it seems that there are no niche areas in the industry.

These are some of the areas of specialization a start-up advertising agency can specialize in within the advertising agencies industry;

  • Print media advertising
  • TV and Radio advertising
  • Search engine optimization (SEO)
  • Banner advertising
  • Video advertising
  • Rich media advertising
  • Sponsorship advertising
  • Classifieds/directories
  • Digital display advertising
  • Mobile advertising
  • Other related digital marketing advisory and consulting services

The Level of Competition in the Advertising Agencies Industry

Surviving in the business world as an advertising agency requires more than your expertise and knowing how to conduct your business but also how to network with key people that matters; decision makers that can decide who will get an advertising contract or a business deal.

The level of competitions in the advertising agencies industry to some extent depends largely the location of the business and of course the niche of your advertising agency business. If you can successfully create a unique niche for your advertising agency, you are likely going to experience little or no competition. For instance, if you are the only advertising agency that specializes in rich media advertising and video advertising in your location, you are sure of monopolizing that aspect of the business; your competitors can even sub – contract jobs to you to help them deliver.

When it comes to advertising agencies, distance is never a barrier when competing for clients. What most clients want is result, hence they are ready to hire advertising agencies no matter the part of the world they operate from as long as they have good track record and can deliver excellent results.

But over and above, there are several advertising agencies scattered all around the United States and in the cyber space. So, if you choose to start your own advertising agency in the United States, you will definitely meet stiffer competitions not only amongst advertising agencies in the United States, but also all over the globe. Besides, there are larger advertising agencies that determine the trends in the industry and you should be ready to compete with them for clients.

List of Well-Known Brands in the Advertising Industry

These are some of the leading advertising agencies in the United States of America;

  • 22squared, Atlanta
  • 360i, New York City
  • aQuantive, Seattle
  • Axis41, Salt Lake City, Utah
  • BBDO, New York City
  • WB Doner & Company, Southfield, Michigan
  • Butler, Shine, Stern & Partners, Sausalito
  • Conversant, Chicago, Illinois
  • Ogilvy & Mather, New York City
  • Cramer-Krasselt, Chicago
  • Crispin Porter + Bogusky, Miami, Florida
  • DDB Worldwide, New York City
  • Deutsch Inc., New York City
  • Digitas, Boston, Massachusetts
  • DeVito/Verdi, New York City
  • Foote, Cone & Belding, Chicago, Illinois
  • Grey Advertising, New York City
  • GSD&M, Austin, Texas
  • Google, Mountain View, California
  • iProspect, Boston, Massachusetts

Economic Analysis

If you are looking for a business that requires less stress and perhaps minimal start-up capital to start, you can consider starting an advertising agency business. The cost of running an advertising agency when compared to the turnover you get can be poles apart (this is applicable when you have been able to establish your feet in the industry).

People that venture into the advertising agency business can as a matter of fact start the business from their home and still make headway in the business. One thing is certain when it comes to advertising agency and most consulting related businesses, you are sure of making profits when you successfully produce results that are measurable for an organization.

As a matter of fact, the cost of running the business process from start to finish could be restricted to the cost of making phone calls, transportation and internet subscriptions, PR and in some cases materials such as TV air time, Radio air time, digital billboards et al. With that, it is easier to place a projection on the profits you are likely going to make if you are able to successfully seal an advertising agency cum branding deal from an organization.

Starting Your Advertising Agencies from the Scratch versus Buying a Franchise

When it comes to starting a business of this nature, it will pay you to start from the scratch as against buying a franchise. First and foremost, before you can secure an advertising cum branding job, your profile will be scrutinized even if you are operating the franchise of a successful advertising agency brand. Besides it is expensive and perhaps difficult to come by a franchise of an advertising agency.

Please note that most of the big and successful advertising agencies around started from the scratch and they were able to build a solid business brand. It takes dedication, hard work and determination to achieve business success and of course you can build your own advertising agency brand to become a successful brand in your area of specialization and even go ahead to work for clients both at the national level and global stage.

Possible Threats and Challenges You Will Face When Starting an Advertising Agency Business

If you decide to start your own advertising agency business today, one of the major challenge you are likely going to face is the presence of well established advertising agencies and also digital marketing agencies who are offering same services that you intend offering. The only way to avoid this challenge is to create your own market; concentrate on start–ups who can’t afford the high-end fees charge by well established advertising agencies.

Some other challenges and threats that you are likely going to face is economic downturn. If the economy is in a bad shape, history has it that the consulting industry cum advertising agencies line of business usually struggles to maintain their old clients or even win new clients. So also unfavorable government policies can also hamper the growth of your advertising agency.

Starting an Advertising Agency Business Online – Legal Matters

  • Best legal entity to use for an Advertising Agency Business

Starting an advertising agency business is indeed a serious business so the legal entity you choose will go a long way to determine how big you want the business to grow. No doubt choosing a legal entity for a business can be a bit challenging.

When it comes to choosing a legal entity for your advertising agency you have the option of choosing from general partnership, a limited partnership, an LLC, a “C” corporation, or a “S” corporation. It is important to clearly state that these different forms of legal structure for businesses have their own advantages and disadvantages; which is why you must weigh your options properly before making your choice.

These are some of the factors you should consider before choosing a legal entity for your advertising agency business; limitation of personal liability, ease of transferability, admission of new owners and investors’ expectation and of course taxes.

If you take your time to critically study the various legal entities to use for your advertising agency business, you will agree that limited liability company; an LLC is the most suitable. You can start this type of business as limited liability company (LLC) and in future convert it to a ‘C’ corporation or an ‘S’ corporation especially when you have the plans of going public.

Upgrading to a ‘C’ corporation or ‘S’ corporation will give you the opportunity to grow your advertising agency business so as to compete with major players in the industry. You will also be able to generate capital from venture capital firms, enjoy separate tax structure, and you can easily transfer ownership of the company; you will enjoy flexibility in ownership and in your management structures.

Catchy Business Name Ideas Suitable for an Advertising Agency

When it comes to choosing a name for your business, you should be creative because whatever name you choose for your business will go a long way to create a perception of what the business represents. Usually it is the norm for people to follow the trend in the industry they intend operating from when naming their business.

If you are considering starting your own advertising agency, here are some catchy names that you can choose from;

  • Excel Advertising Agency, LLC
  • Charis Branding & Marketing Communications, Inc.
  • Clay Newton PR®, Inc.
  • Mitton Grey Advertising Agency, LLC
  • The Hedge PR Consulting Group, Inc.
  • Leslie & Lopez International, LLC
  • Carrington Denzel Media Marketing Co.
  • Brighton Gab PR & Digital Marketing, Inc.
  • Garry Jay Advertising & Communications, Inc.
  • Boston International PR Company
  • Harry Dep Advertising & Marketing Communications Ltd.

Insurance Policies

In the United States and in most countries of the world, you can’t operate a business without having some of the basic insurance that are required by the industry you want to operate from. So, it is important to create a budget for insurance and perhaps consult an insurance broker to guide you in choosing the best and most appropriate insurance policies for your advertising agency business.

Here is some of the basic insurance cover that you should consider purchasing if you want to start your own advertising agency business in the United States of America;

  • General insurance
  • Health insurance
  • Liability insurance
  • Workers compensation
  • Overhead expense disability insurance
  • Business owner’s policy group insurance
  • Payment protection insurance

Intellectual Property Protection/Trademark

If you are considering starting your own advertising agency business, usually you may not have any need to file for intellectual property protection/trademark. This is so because the nature of the business makes it possible for you to successful run the business without having any cause to challenge anybody in court for illegally making use of your company’s intellectual properties.

But if you just want to protect your company’s logo and other documents or software that are unique to you or even jingles and media production concepts, then you can go ahead to file for intellectual property protection. If you want to register your trademark, you are expected to begin the process by filing an application with the USPTO. The final approval of your trademark is subjected to the review of attorneys as required by USPTO.

Is Professional Certification Needed to Run an Advertising Agency Business Online?

Aside from the results you produce, professional certification is one of the main reasons why most advertising agencies and digital marketing firms stand out. If you want to make impact in the advertising agencies industry, you should work towards acquiring all the needed certifications in your area of specialization. You are strongly encouraged to pursue professional certifications as it will go a long way to show your commitment towards the business.

These are some of the certifications you can work towards achieving if you want to run your own advertising agency business;

  • IAB Certification
  • Certified Marketing Management Professional – CMMP®
  • AMA Certified Professional Marketer
  • Content Marketing Institute Online Training and Certification
  • Copyblogger Certified Content Marketer
  • DigitalMarketer Certified Content Marketing Specialist
  • Google AdWords Certification
  • Google Analytics Certification
  • HootSuite Advanced Social Media Strategy Certificate
  • Marketing Management Certificate
  • HubSpot Certifications
  • DMA Certified Marketing Professional

Please note that the higher your qualifications and experience (expertise), the easier it is for you to secure high profile advertising, PR, branding and digital marketing contracts.

List of Legal Documents You Need to Run an Advertising Agency

The essence of having the necessary documentation in place before launching a business in the United States of America cannot be overemphasized. It is a fact that you cannot successfully run any business in the United States without the proper documentations.

These are some of the basic legal document that you are expected to have in place if you want to legally run your own advertising agency business in the United States of America;

  • Certificate of Incorporation
  • Business License
  • Business Plan
  • Non – disclosure Agreement
  • Employment Agreement (offer letters)
  • Operating Agreement for LLCs
  • Insurance Policy
  • Consulting contract documents
  • Online Terms of Use
  • Online Privacy Policy Document
  • Apostille (for those who intend operating beyond the United States of America)

Financing Your Advertising Agency Business

Starting an advertising agency business can be cost effective especially if you choose to run the business from your home, share office space with a friend or make use of virtual office. Securing a standard office is part of what will consume a large chunk of your start–up capital, but if you choose to start the business on a small scale, you may not have the need to go source for fund to finance the business.

No doubt when it comes to financing a business, one of the first things and perhaps the major factors that you should consider is to write a good business plan. If you have a good and workable business plan document in place, you may not have to labor yourself before convincing your bank, investors and your friends to invest in your business.

Here are some of the options you can explore when sourcing for start–up capital for your advertising agency business;

  • Raising money from personal savings and sale of personal stocks and properties
  • Raising money from investors and business partners
  • Sell shares to interested investors
  • Applying for loan from your bank/banks
  • Pitching your business idea and applying for business grants and seed funding from donor organizations and angel investors
  • Source for soft loans from your family members and your friends.

Choosing a Suitable Location for your Advertising Agency Business

Advertising agencies and most service based type of businesses require that you see physically with your clients hence it must be located in a good location; a location that is prone to both human and vehicular traffic if indeed you want to attend to loads of clients and maximize profit from the business.

The fact that you can operate your advertising agency from your home does not mean that location has little influence on the success of an advertising agency. If you have taken your time to study the advertising agencies cum consulting industry, you will realize that advertising agencies are willing to pay expensive rents in order to stay in a busy business district; a place where business activities are at its peak.

It cannot be overemphasized that the location you chose to open your advertising agency business is key to the success of the business, hence entrepreneurs are willing to rent or lease facilities in a visible location; a location where the demography consists of people with the required purchasing power and lifestyle.

Starting an Advertising Agency Business Online – Technical & Manpower Details

On the average, there are no special technology or equipment needed to run this type of business except for customized advertising/digital marketing and social media management software applications. In a bid to work out sales and marketing monitoring solutions and also lead generations for your clients, you might be required to design a customized software application.

When it comes to choosing between renting and leasing an office space, the size of the advertising agency you want to build and your entire budget for the business should influence your choice. If you have enough capital to run a standard advertising agency, then you should consider the option of leasing a facility for your office; when you lease, you will be able to work with long – term planning, structuring and expansion.

As regards the number of employees that you are expected to kick start the business with, you would need to consider your finance before making the decision. Averagely, you would need a Chief Executive Officer or President (you can occupy this role), an Admin and Human Resource Manager, PR Consultants, Digital Marketing and Social Medial Management Consultants and Associates (Different areas of specializations as it applies to your business), Business Development Executive/marketing Executive, Customer Service Officer or Front Desk Officer and Accountant.

Over and above, you would need a minimum of 10 key staff to effectively run a medium scale but standard advertising agency. Please note that there will be times when you are expected to go out of your way to hire experts to help you handle some high – profile advertising and PR contracts/jobs. If you are just starting out you may not have the financial capacity or required business structure to retain all the professionals that are expected to work with you which is why you should make plans to partner with PR specialists and digital marketing experts that operate as freelancers.

The Service Delivery Process Involved in an Advertising Agency

On the average, the way advertising agencies work varies from one agency to another agency, but ideally, an advertising agency is expected to first and foremost build a robust company profile before biding for advertising, PR, branding and digital marketing contracts et al; it will give them edge amongst their competitors.

Basically, when an advertising agency secures an advertising, PR, branding, digital marketing contract et al, they are expected to follow through all what they listed to achieve for the organization or individual you are working for. Good enough, with the aid of technology, it is now easier to measure the effectiveness of an advertising, PR and digital marketing project.

So, it is expected that an advertising agency should deploy all its expertise to produce results for its client. Brainstorming both internally and externally on best practices is common amongst advertising, PR, branding and digital marketing experts.

Starting an Advertising Agency Business Online – The Marketing Plan

  • Marketing ideas and strategies

As an advertising and branding expert, you would have to prove your worth over and over again before you can be awarded any advertising, PR, branding and digital marketing contract. So, if you have plans to start your own advertising agency, it will pay you to build first build a successful career in the advertising agencies industry.

People and organizations will hire your services to help them handle all their advertising, PR, branding and digital marketing contracts needs and other branding and promotion campaigns role as it relates to advertising if they know that they are going to get value for their money.

So, when you are drafting your marketing plans and strategies for your advertising agency, make sure that you create a compelling personal and company profile. Asides from your qualifications and experience, it is important to clearly state in practical terms what you have been able to achieve in time past as it relates to advertising, PR, branding, digital marketing contracts et al and the organizations you have worked for in time past. This will help boost your chances in the market place when sourcing for advertising, PR, branding and digital marketing contracts et al.

Please note that in most cases when you bid for advertising, PR, branding, digital marketing contracts et al from organizations, you will be called upon to defend your proposal, so you must be pretty good with presentations. Here are some of the platforms you can utilize to market your advertising agency services;

  • Introduce your business by sending introductory letters alongside your brochure to all corporate organizations and businesses in the United States ( if you are just starting out, you may want to concentrate on start–ups and smaller businesses).
  • Promptness in bidding for advertising, PR, branding, digital marketing contracts et al.
  • Advertise your business in relevant business magazines, radio stations and TV stations (make yourself available for advertising, PR, branding and digital marketing related talk shows and interactive sessions on TV and Radio).
  • List your business on local directories/yellow pages.
  • Attend recruitment/HR expos, seminars, business fairs et al.
  • Create different packages for different categories of clients in order to work with their budget.
  • Leverage on the internet to promote your business (when you blog regularly on key issues as it relates to your business, people will consider you an expert in the field).
  • Join local chambers of commerce around you with the main aim of networking and marketing your services; you are likely going to get referrals from such networks.
  • Engage the services of marketing executives and business developers to carry out direct marketing.

Strategies to Boost Your Ad Agency Brand Awareness and Create Your Corporate Identity

As an advertising, PR, branding, digital marketing contracts et al expert, boosting brands and creating corporate identity is your forte, hence nothing less is expected from you.

If you are in business and you are not deliberate about boosting you brand awareness and communicating your corporate identity, then you should be ready to take on whatever the society portray your business to be. One of the secret of larger corporations is that they are willing to spend fortunes year in and year out to boost their brand awareness and to continue to communicate their corporate identity the way they want people to perceive them.

If your intentions of starting an advertising agency is to grow the business beyond the city where you are going to be operating from to become a national and international brand, then you must be ready to spend money on promotion and advertisement of your brand.

In promoting your brand and corporate identity, you should leverage on both the print and electronic media and also the social media (the internet). As a matter of fact, it is cost effective to use the internet and social media platforms to promote your brands, besides it is pretty much effective and wide reaching.

Another strategy is to sponsor relevant community based programs, TV and radio programs, advertise your business in relevant magazines and newspapers.

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