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Starting a digital agency or business a short guide

This article covers some of the basic points you will need to cover if your thinking about starting a business, this guide is orientated around a business offering digital services but could be applied to any business.

There are probably thousands of digital agencies in the uk all competing at different levels from small teams to the much larger players. So in a market that has in recent years seen significant saturation at least at the lower end , how does a new agency carve out it’s piece of the pie?

To give you a little background I helped start an agency a couple of years ago, and in this short yet critical time period we learn’t a lot of lessons along the way, in this post I’m going to share some of the things we learn’t about starting a business specifically one marketing digital services so if your considering starting out on your own this post is for you.

Photo credit beyonddesignuk

When I say agency I typically mean if you have one or more staff to get to this point you will need to be one of the following:

  • Socialable type with many friends and contacts you can depend on to get your initial work from
  • Have a reliable and profitable pool of existing clients
  • An investor , wealthy relative or your own savings
Apart from the later you still need investment of some form to spend on staff or your own marketing to make it from a freelancer to a business having staff is vital , even the most well equiped teams can find themselves under resourced.

Have your investment?


Assuming you’ve figured out the above how do you go about planning your business and your own marketing?

Well in most cases I suspect you’ve come from a marketing background wether that’s a web designer , developer or marketing manager you’ve got your own ideas on how to do things and your willing to give it a shot.

This is where you might be assuming you have the skill set to start a business, well… that’s just where you could be wrong there’s lots of very talented designer’s , developers out there who by all means know their craft very well and are completely awesome at it, marketing a business is especially difficult starting out if you’ve had no direct experience of building a brand it can be disorientating figuring out where to spend the money (more on this later) and what your service offering should be.

Invest in your team

Photo credit

When starting any business costs are kept to a minimum, this is one area you should seriously invest as much as you can afford.

Think carefully about recruitment – Thinking of hiring Juniors? Yes they can be cost effective but in the long run they don’t have the skillset you need to operate from day one , secondly they will eat up your own precious time or your employee’s time in training, though if you can find a superstar that is young and low cost then it can work out.

Write your company policies – Sickness , holidays etc spending time here not only helps you in the long run but creates a clear picture of how you operate, what you expect from your employees and if nothing else a goal for how it’s going to be run.

Do thorough interviews – Any prospectve employee should be put through their paces my personal preference is to give them a practical test where possible, make sure they are fully capable of what you require them to do.

Have incentives – This isn’t appropriate in every industry , in digital I think it’s expected not only that a strong incentive via a bonus , paid nights out or otherwise it create’s a postive atmosphere of success and shows that you care about their performance. These don’t have to cost you the earth simple things like a voucher on someone’s birthday.

Choose the right people – Wether you have business partners in mind or your hiring a whole team make sure they have the skills and the attitude that fit in to your  business ethos and what the company is about. If you are entering a partnership make sure the people have different skills to yourself.

Educate yourself


Forget what you think you know – Don’t base your way of working on ideas from your previous employer what worked for them might not work for you. If you have no direct experience of marketing, either producing marketing material or ideas then it’s a good idea to do some research in this area to find out the ways to get your name out there.

Read – It helps to read how others did it, you may not be able to implement their ideas into your business but it certainly gets you thinking about the right things. Some good books amongst other would be:

Skills Assessment

Assess yourself and others in the proposed business where does everyone fit in and what are their strengths and weakness’s? What’s your leadership style like? How do you cope with stress? if your entering a partnership with others make sure from day one that it’s clearly defined who will have what responsibilities, of course you can keep it flexible, as the business grows and finds it’s feet the positions and responsibilities will change. If you don’t define these it can be unclear how decisions are made and decisions may not get made at all because of the confusion over who makes them.

If nobody in the business has direct sales experience then you will need to hire these skills, the most important part of any startup is generating new business. It can be hard learning to acquire these skills yourself if your not naturally good at selling, if you have the time though you may be able to pull it off.

What’s the end goal?

Do you want to work on small websites , ecommerce websites or is it just SEO you offer? Think carefully about what your going to offer and in what capacity. Use local networking events to seek out your competition and meet them in person. What are they doing right , how do they present themselves and how can you be different?

Positioning – It’s much easier to aim for the top end of the market or a higher quality product after all not everyone makes decisions based purely on price. There are most likely hundred’s of freelancers in your area offering their service at cheap prices, there’s also big competition from sites like peopleperhour where people from India and other places will work for practically nothing. The types of clients these sites attract are not the clients you want long term. On the other hand dealing with large corporates brings it’s own problems as you will have to pitch against other competing firms or write lengthy tender submissions which takes time and precious resources that may result in nothing.

Don’t offer everything and anything, sure if a client comes in asking about a service and you don’t directly have the skills you can always outsource to local firms, but in the long run supporting this work becomes tiresome. Stick to the skills you have in house and focus specifically on those areas. If you do outsource make sure the company or person is reliable and you have a good relationship with them agreeing maintenance rates up front.

Find a hook


Unlike captain cook, a hook is something that literally hooks the customer in , it should be something unique that you provide over anyone else or some amazing benefit that you bring to their business. It’s is used in your marketing to capture your customers attention. When we first started we didn’t have a hook and when we would phone a business up our offering would be something like “We are a full service agency we provide social media, web development, mobile apps .. etc” we didn’t think how we would be perceived and although even this approach netted us some meetings it wasn’t very effective. How where we different from any other company phoning up offering their services – we didn’t stand out.

That’s when we really worked out what we could focus on, for us we had completed several high profile ecommerce websites and that was what we where good at ecommerce, we re-branded our marketing and offering a more ecommerce focused approach of course if clients said they wanted a mobile app we would still be able to do it, but we where not actively seeking that type of work.

We developed a system where the client was given something for free in return we could work out if they where interested in doing work on their website from this we could then push for their budget and finally a meeting or proposal. By focusing our company on one particular area if we then approached a client we had something over most companies who offered everything – we were now specialists in ecommerce.

Develop the business

Once you’ve got going looking after any clients you do win should be your primary objective , you should bend over backwards to their every need it will be a lot of work but producing high quality work and excellent customer service will get you the referrals and recurring business that you need. It’s important that a client management process is established. Someone within the business who acts as a point of contact for your clients and keeps a regular dialogue going – after all if you keep up the conversation with your clients at least they are talking to you and not your competitors.

Marketing a new business

Initially you may start with a flurry of work from friends, contacts and referrals who have heard about your new business, after a while though this may start to taper off. Marketing should be a part of your plan from day one if it isn’t you will find you run out of work quite quickly at least if you have a team of people to pay. From the start set out a 6 month marketing plan in a simple excel spreadsheet stating how and when your going to spend the money. (like this example Marketing Plan) There are a bewildering number of ways to do that here’s a few I would recommend.

Email marketing – This may set you back around £3-4k for good quality data , you can also include your own contact database and you could research potential customers and build up a list that way but that may take some time. Send out an email blast every week or two with mixed messages that reach your target market.

You can send out email campaigns pretty easily using campaign monitor, mailchimp or many other similar services on a monthly subscription of credits in total it shouldn’t cost you more than around £300-400 a month depending on the size of your list.

Brochure mailing – Posting is no longer very cheap and this is an expensive option, if you have the funds though it can be very effective. It’s nice to hold something real in your hands and if you get it to the right person it might just sit on their desk and one day they might actually read it.

Magazine advert – Featuring in specific digital magazines like the drum can be a good way to get a large amount of coverage for a reasonable fee, some magazines cost more than others and it can be expensive, usually if it’s your first time in the magazine they will offer a special rate and bundle in online advertising for free, but results from this will vary and it’s much much harder to convert offline into online.

SEO – Because your a startup even if you have an existing domain for many years it’s unlikely you can get found for competitive keywords such as “seo london” or similar , what you should first aim to conquer is your local market so wherever your based aim to be on page one for those types of searches at a town level e.g “seo my town” this at least establishes you in the local area and these types of searches although less frequent, convert much easier into a phone call or enquiry. Build blog posts and other pages to target the more competitive ones.

Start a blog – Yep if your an expert in the area then why not write some articles on it? Firstly this shows potential clients visiting your site that you really do know what your talking about and that your up to date with the latest things in your sector. Consider writing about specific subjects that your target industry would be interested in for example if your targeting the car industry you could include relevant news and research from this area that isn’t directly about the service your offering.

Aim some of your posts around searches people make that answer a question, whenever you search for something you usually type in a question – provide the answer. Google likes fresh content and each post you make for a limited time will appear much higher in the search results than your site usually would, it may be a case of trying out different topics to find the right type of traffic.

Telemarketing – Now I myself hate it when people cold call , but some people don’t mind it and it depends how they approach you. Some marketing managers even like it, it keeps them up to date with recent developments and informs them of what they should be doing, I’m sure you’ve received a few calls where you’ve actually listened to what they had to say. The calls need to be structured and thought out and ideally by someone with experience of doing just this, if it’s just you then be prepared to phone a lot of people before you get the hang of it. Natural sales skills are most effective here.

Networking – This is one of the most important one’s, attend local networking events there will be many different one’s in your area, some to avoid are one’s like the BNI. For digital agencies the types of people you find there are mainly traders and really won’t have the budgets for the work you would like, that said you could attend these anyways as it’s not about that people in the room it’s the people they know outside the room that will bring you the business. Personally though I prefer events which include more corporate types such as the FSB and others and which don’t work on a referral system.

Other ways to Network are going to shows and events in your industry e.g Internet World in London take a big stack of business cards and introduce yourself to as many people as you can. As well as finding potential clients you can also use the business cards you receive to build up your own database of contacts.

Luck can be something you control the more you expose yourself the more opportunities you will receive.

Event Talks – Yep your an expert right? well find a topic to talk on and present at an event, approach the companies that host the events e.g Rackspace or a developer conference,  etc.. especially if you’ve worked on something cutting edge that’s a great case study to talk about and if your likeable there could be potential clients in the audience.

Clever Marketing – If you have the time and budget these methods can be very effective but are resource intensive. If you really want to go for the big boys think outside the box, one way to do this is to react quickly to recent press on the company you want to work with let’s say it’s Sainsbury’s and they have announced they are working with a local authority on a new park for a charity project. The project in question will no doubt need a lot of printed material possibly a website and other marketing materials. If you can get the right person to send something to you can create a very customised introduction to your business. You need to get creative and produce something that is unusual and striking not necessarily on the project itself it could be a creative spin on your team profiles. One agency I know had a bag of crisps with the names of the people that worked there inside. This was a bag that was printed professionally so it looked like a real packet of crisps with their agency branding on the outside. Coming up with these ideas takes time and effort, if you don’t have a big creative team to bounce ideas around this may not be the best approach as you may not be big enough yet to take on the work anyways.

Social media – Avoid spending too much time on these networks if your service or product is B2B , I’ve found Twitter to be useful and it requires little time to update it. We started off with a Facebook page but no longer keep it updated in our view it’s a waste of time for B2B at least currently how it works , the only platforms you should consider are Twitter, LinkedIn and possibly Google+ you can set your blog to post to Twitter automatically and use tools like HootSuite to save time for both Twitter and LinkedIn. Schedule 10-15 minutes a day to set up and schedule your messages, you may also want to set up searches through HootSuite to monitor certain keywords for example if your provide SEO set some up for “seo”, “search engine optimisation” etc and you can either retweet or try and engage with potential clients through these channels.

There’s quite a few others I haven’t covered here that will depend on exactly the services your offering.

Location, Location

If your looking around for office space one thing to consider is location, as with all property location is King. Depending on your aspirations for the future growth of your company this should be something you give some thought to. Initially when you start out you may have the team from friends, partners or whoever, who collectively form the company but as you grow you will need more staff. Where your located can be an issue if your far away from the nearest train station or large city it will be hard to attract employees and especially talented ones. Pick somewhere that offers easy access to local shops cafe’s good commuter links or ideally located where there is an influx of the type of employee your likely to need, such as the UK’s silicon valley equivalent in Shoreditch , East London.

What should I charge?

It can be difficult to work out your rates and depending on location, type of work, market rates etc that would be difficult to suggest here , however one way of working out your actual costs and deciding your profit margin is like so:

(employee’s wage) / (paid hours inc holidays + employers NIC + (Office costs / staff))

You then have an hourly rate on a cost basis which you can markup by percentage or on a multiplier basis, see this Employee_Calculator as an example.


In the next article I will talk about the running of the business.

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