The landscape of advertising has changed a lot since the era that Mad Men was set in. Digital advertising is the norm and is increasingly important for all businesses, regardless of whether they are eCommerce or provide a service. In this article, we discuss the different types of advertising, why it’s important, the pros and cons of hiring a freelancer over an agency, the pricing structure, and how to find an agency that is right for you.
What is an Advertising Agency?
An advertising agency is a company that solely focuses on creating advertisements for your business, driving customers to your company—whether it is online or a brick-and-mortar location.
Many people can be confused about the differences between a marketing and advertising agency. Both specialties focus on the branding process of the company. However, a marketing agency focuses on strategies to increase revenue and boost general awareness of the company. Advertisers implement a part of the strategy that marketers develop. An example of this would be Paid Per Click advertising—the marketing agency would decide which keywords would be used while the advertiser would design the advertisement.
What are the Different Types of Advertising Services?
Overall, there are 13 types of advertising that a company can use. These include Print, Direct Mail, Television, Radio, Podcast, Mobile, Social Media, Paid Search, Native, Display, Outdoor, Guerilla, and Product placement. However, we will discuss a few in more detail:
Mobile
Mobile advertising focuses on advertising that can be accessed on a mobile device or tablet. Mobile advertising can overlap with other types, like social media because a user may see an advertisement via social media accessed through a smartphone. Another example is overlapping with print advertising when a user accesses an ad using a printed QR code. However, other examples of mobile advertising include ads found on all apps, like when you are playing a game or using a bus tracker.
Paid Search
Most commonly referred to as pay-per-click (PPC), paid search advertising is when a company pays a fee each time a user clicks on their ad on a search engine. Closely tied to Search Engine Optimization (SEO), companies use specific keywords in search engines to have their ads pop up and pay for the use of said keywords. The higher they pay or bid for the keyword, the more likely the result will come up at the top of the search results when the user looks up the keyword.
Native
Native advertising is when an ad looks and feels like the content on the rest of the webpage or social page but is actually paid. An example of this is when a celebrity creates a post on their social page that is a sponsored ad, perhaps for a beauty product that they state they “love.” Native advertising is particularly common among social influencers and while it looks like it is a genuine, non-prompted post, there is usually some wording that explains that it is paid.
Display
Examples of display advertising include when there is a banner on a webpage or a pop-up that appears. Display advertising commonly uses cookies so that you may see an ad for a company that you had just visited online.
Guerrilla
Guerrilla advertising uses less traditional ways to advertise the company or mission they are representing. An example of this could be a flash mob that performs an act or dance for the performance they are wanting people to pay to see.
Why Do I Need to Invest in Advertising for my Business?
Almost everything is digitized now, and customers use social media and the internet to find products and services they need. In order to get ahead of the game, you need to do more than simply have a website and social channels. Investing in digital and diverse advertising will ensure that you are being seen by the customers you want so that you can increase revenue—your company’s ultimate goal.
Should I Hire an Advertising Agency or a Freelancer?
Now that you have an understanding of the value of advertising, it is time to decide how to hire your designer: either through an agency or freelancer.
Positives and Negatives of an Agency
If you choose to work with an agency, the number one benefit is the resources they can provide. Agencies are built out of many individuals with different talents, whether that is creative, analytical, or management. This means that if you plan to do a televised commercial, they will have staff to write the script, determine the ideal ad space and manage its success. The downside of working with an agency, however, is that they can be more costly because they are maintaining the salaries of the whole agency vs one or two individuals.
Positives and Negatives of Freelancers
If you have a small, one-off advertisement, then a freelancer may be your ideal option. Freelancers can come in and work on a small project like a native ad blog post on your site and then when it is done, the contract is complete. Freelancers only work on one-off small projects so if you are looking to create long-term or more complex projects, this option won’t suit your business needs.
Why You Should Hire an Advertising Agency
You may have noticed that we did not include the option for in-house staff members to focus on advertising. This is because this is rarely a situation that happens. Even big corporations typically hire an advertising agency to support their marketing needs. While they will have a marketing department to focus on strategy, they will outsource their advertising needs to an agency for the reasons we explained above—it is the smart choice. So, whether you are a small business owner, or a CEO of a large corporation, hiring an agency to focus on your advertising needs is the way to go.
Hiring an Advertising Agency
If you have come this far, you have likely smartly decided to hire an advertising agency. But how much does it cost and where do you start? Look at our thoughts below.
How Much Does It Cost to Hire an Advertising Agency?
The cost of an advertising agency depends on your needs, so before you draw up your budget, be sure to reflect on your marketing plan and strategies and outline the items you need from an agency. This can be in tiers of what is most important to least important, as the cost will fluctuate depending on the agency and ad type.
Agencies typically have a Rate Card that they will use to propose the costs of your project. When it comes to costs there are several types to consider:
- Advertising agency fees—these include start-up fees and hourly fees.
- Media buying—This includes the cost of hosting an ad.
- Consultation and Creative Development—This includes graphic design, videography, and any talent fees (e.g., actors).
- Ad Management—This includes maintaining ads and ensuring they are working for you.
It is also worth looking at if agencies have a la carte options or if they work full service. A la cart will be cheaper if your scope is small but will get more expensive as you add more tasks. The benefit of using a full-service ad agency is that they will do all the work for you, and as long as the scope of the project is not blown, you can more easily ensure your budget is maintained.
While agencies pricing can range as high as in the millions, it is important to note that even small (aka cheaper) agencies are still worth looking into. Advertising is a very creative industry, so as long as you have an agency that is creative and understands your needs, you do not necessarily have to pay exorbitant fees to get what you want. For more details on different fees, check out the 4A’s (leading trade association for ad agencies) billing rate report.
How to Find an Advertising Agency
As you can see from the pricing structure, finding the right agency for you can seem daunting. However, it doesn’t have to be. A great first step is to check out UpCity’s detailed list of advertising agencies.Other places to find an agency include doing a Google search, looking through LinkedIn, and as our experts say, going on referrals. Using word-of-mouth referrals from your friends is great because you are sure to find someone that understands your culture.
As you comb through the types of agencies, be sure to have your list of the most important items ready. If the agency focuses on television ads and your scope is PPC, then that agency is not an option for you. Once you have narrowed down the options, look at the agency’s website and look at their portfolio—Is their work aligned with your vision? If so, then look at the testimonials and reviews to see how their former customers found the working relationship. There is nothing worse than finding what you thought would be the right fit only to find out that their communication style or culture is not aligned with yours.
Questions to Ask an Advertising Agency
Once you have created a shortlist of agencies that you are interested in, schedule a chat, and come prepared with the questions. Here are examples of questions you could ask:
- Do you specialize in my industry?
- After researching my company, how would you approach the marketing plan and our business needs through marketing campaigns?
- Are there any gaps you see in our marketing budget or goals that we could maximize?
- Do you have a graphic designer or web designer on staff, or do you outsource this?
Expert Tips for Choosing the Right Advertising Agency
While we could share some tips and tricks to find a suitable advertising agency, we thought we would reach out to the experts themselves. UpCity surveyed leaders in the industry, and this is what they had to say:
In your opinion, what are your top tips for finding and hiring a great advertising agency?
“Be clear about the role YOU want from your agency: Will the agency listen to (and follow through) on your ideas? Do you want them to? Some companies absolutely want the expertise of their agency, but other companies can often feel frustrated that their intimate, first-hand knowledge of their business is either disregarded or ignored. This is a cultural challenge for agencies who, for the most part, are created to be the stewards and leaders of your advertising. This approach works well for larger companies, but if you are a small business owner, have ideas and deep knowledge of your business, make sure you understand whether you want a partner—or are fully comfortable delegating all aspects of your advertising to the agency.”
—Jerry Quinn, Agency Owner, MESMERO
“First, know what they are offering, Review their previous marketing case studies. If you are satisfied with this, then start a conversion with them, tell them about your ultimate goal & check whether they can able achieve it or not by asking strategies for marketing your brand. Understand their reporting methods, is possible to set every 15-day virtual meeting to know the progress of your project. If all of these factors are fit into the agency, then you should trust them and hire also!”
—Sagar Prajapati, Digital Marketing Head, Global Vincitore
“It’s important to find an agency that not only has the skills you need but also personnel with whom you enjoy working. A trusting and enjoyable working relationship can be just as key to success as expertise.”
—Jen Stafford, CEO/Co-Founder, CTRL+ALT Digital
When comparing the cost of an agency to an in-house team, note that a full-time, in-house team on average costs $261,500 per year.
Hear From Industry Experts
Read the latest tips, research, best practices, and insights from our community of expert B2B service providers.
What traits should you look for in an advertising agency?
“Great advertising agencies should have a solid track record, a great response time to potential and current clients, month to month services rather than long-term commitments, and most importantly, a sense of being real people who care. If someone doesn’t seem to care about your needs in the first place, it can be an awful experience.”
—Jonathan Diener, Creative Director, KARMA jack Digital Marketing
“Look for agencies that focus on tracking leads and/or sales. A lot of agencies focus on numbers that don’t matter as much like clicks and impressions. I’d much rather get someone 10 clicks and 9 customers than 1,000 clicks and 8 customers. Numbers like clicks and impressions are important, but they are only part of the equation. Generating revenue is the goal – be sure you don’t lose sight of that.”
—Brandon Howard, President, All My Web Needs
Are there any mistakes that you should avoid when hiring an advertising agency?
“Don’t hire an agency because they got big results in a campaign that will look nothing like yours. Impressive metrics are great, but they are much more valuable if they are relevant to the kind of audience you’ll be going after.”
—Austin Evans, Digital Content Strategist, 5by5 Agency
“There are two main mistakes to avoid when hiring an agency. Number 1 is getting in the way of your own success. Let the experts handle the project A-Z to see the best results- and this way the agency will have accountability for the results. Number two is maintaining ownership of your properties. There is absolutely NO REASON for an agency to own your website or have ownership of any ad accounts or analytics accounts. Typically this is used as a scare tactic down the line when they aren’t delivering results.”
—Kevin Heimlich, CEO, The Ad Firm
“Don’t be fooled with screen shares and images of high-dollar spending. Also, be prepared to have tangible KPIs. The right agency will want to participate in the sales/revenue conversation.”
—Christopher Nault, Founder, Growth Marketing Firm
Post-Hiring Expectations
Once you have found the right agency and your contract is ready, you can expect a few things once the work gets started:
- Reconfirm understanding of project requirements
- Conversations with the marketing team around marketing goals, target audience objectives, and deliverables
- Initial work gathering information and data on any potential existing advertising
- Follow the project management model established in the initial proposal
- Regular reports on successes and opportunities including graphic design proofs and reporting on KPIs.
Do you have any questions about hiring the best advertising agency for your business? Check out our picks for the top companies for further information.