Starting an ad agency? Nail these steps or struggle later.
Dav Nash
14 min read
If you’ve been toying with the idea of launching your own idea, congratulations!
It’s such an exciting journey to begin.
Maybe even a little scary!
But looking to create your own thing is always a huge accomplishment.
When you have no idea where to begin and you’re wondering how to start an advertising agency, it’s important to break it all down.
And luckily for you, this is exactly what I’m going to do in this post.
To guide you through the process of starting your ad agency successfully, we’re going to run through:
Good stuff!
Let’s get stuck into it, shall we?
The idea of getting underway is usually a lot more terrifying in theory than it is in practice.
The key to making it far less intimidating is breaking it all down.
Initially, you’re going to be doing a lot of planning.
Sure, you could just get cracking and see what happens – but that will tend to be far more chaotic than effective.
So to begin with, you want to get your ideas together and build a business plan.
It’s always good to start with a goal.
Plus, when you understand more of why you wanted to launch your own agency in the first place, it’ll help you to build it in the right way.
So sit down and think about some key questions here:
What’s your motivation for starting your advertising agency?
What do you hope to achieve?
How do you want it to look and feel?
With this in mind, you can then start to formulate some goals.
Remember, you want them to be quite specific here.
(Don’t worry, I’m not going to tell you to get SMART – but that is relevant here)
Be super clear on what you’re doing and why, along with what your target is.
Make sure that you have a time limit here – do you have a goal for your first year? The first five? Maybe even a longer-term goal?
It’s handy to just get out anything and everything you have in mind at this point.
The next thing you’re going to want to do is your market research.
It’s one thing to want to start an advertising agency and another one to actually make it work.
Understanding your market, finding the gaps, and then filling them is key here.
There’s a range of ways you could look to do market research – it’s entirely up to you how you do it.
Initially, you’re going to want to do a thorough competitor analysis so you can identify what’s already going on in the market.
To add to that, you might want to conduct surveys or hold a focus group. It can often depend on what resources you have here.
Either way, you need to know what agencies are already doing so that you:
a) Don’t end up as a subpar version
b) Look to shake things up and bring something different
You’ll also want to create a business plan.
In some cases, you’ll actually need this. If you plan on getting funding, you’ll need to have a solid business plan (with projections) that lays everything out in great detail.
But even if you’re planning on bootstrapping things, it can help you to have this as a guide.
In general, you want your business plan to outline:
With this all in place, you’re going to have a much better picture of how to start an ad agency.
But we’re getting ahead of ourselves here.
Let’s break all that down a little further now.
So now we’re going to get more into the specifics.
Because even though you want to learn how to start an advertising agency, that’s such a broad term.
You need to work out what kind of advertising you’d like to do.
Or what kind of clients you’d like to work with.
Or what market you’d prefer to be in.
I know, I know… it’s a lot!
So here’s a simple way of working that all out…
The easiest way to uncomplicate things is to focus on your area of expertise.
You could totally look at trying to learn something new, but if you have a lot of knowledge and experience in a set area, stick to that.
Going into business can be tough, so keeping things simple can help.
If you’ve been working on social ads for a decade, that’s a no-brainer.
But, there’s no reason why you couldn’t pick up other offerings along the way and add them on at a later date.
The same goes for the kind of clients you want to work with and what market you’d like to go into.
If there’s something that you have a lot of experience with (and you have proven results in), this naturally makes sense.
It’s also essential for you to understand the market here.
Again, go back to your market research.
Are there any gaps?
Can you bring something new to the market or look at doing things differently?
Sometimes, the best thing to do is choose a niche that is in demand or that is largely underrepresented.
At this point, you should have a good idea of what you’re creating and how it’s likely going to come together.
But now, we have to get the official stuff set up.
Launching an ad agency means starting a business.
So start a business you shall.
This can be done in two main ways:
1. Officially creating a business entity
2. Building the brand in front of the business
When you’re going into business, you need to decide what that looks like.
In the UK, you have a few options here.
Firstly, if you’re thinking of bootstrapping things by yourself, there’s no reason why you can’t start off as a freelancer or consultant under your agency branding.
For this, you’d register as a self-employed sole trader with HMRC and do yearly tax returns.
But, if you want to go all out from the start, you can also form a company.
Here, you can either do a partnership (if there are two of you) or go with a private limited company.
With a company, you’ll have to keep accurate records of your financials and file company tax returns (or hire an accountant to take care of it all).
Both options have pros and cons, it’s important to choose the option which feels right to you and is aligned with your goals.
Either way, you need to decide which route you want to take and get everything filed and registered correctly.
Then we have the visual side of the business.
Along with getting the paperwork side of things sorted, you’ll want to create a brand identity for your agency too.
Starting with a name!
Feel free to get creative with your name – we are in marketing, after all.
But also look at making sure it’s relevant to your niche too.
You’ll also need a logo, brand colours, and brand fonts.
If you’re a designer or fancy yourself as one, you can look to do these yourself.
But you can also look at roping in a designer friend to pull them together for you too.
And yes, when you have the name and logo in place, it does start to feel very real!
It’s safe to say that without people you’re not going to have much of an agency!
Even if you decide to get started as a sole trader initially, you’re still going to need people around you to support the growth and development of the agency.
And if you’re going full limited company from the get-go, you’ll want to bring in the key people that matter early on.
To build a team, you need to work out what roles you need within the agency.
It may be the case that you want to take on a handful of key roles initially and look to expand as the business grows.
This often makes a lot of sense because you won’t be taking on too many overheads from the beginning.
Depending on what kind of ad agency you’re building, you may need some of the following people:
It might be that you hire contractors for some of these roles instead of bringing everyone in-house.
Alongside the more integral agency execution team, you’ll also have areas of the business to think about such as finance, HR, client services, and operations.
Again, you can outsource many of these areas, or look to take on a few areas yourself in the beginning.
There’s nothing wrong with starting scrappy, that’s for sure!
When you’ve got a better idea of who you need, you then need to go about recruiting them!
Assuming you have agency experience already, you may already know a lot of people in the industry.
This helps!
You may already know who you plan to hire and/or have already had conversations with them.
This is even better!
Just remember that non-compete clauses exist so you’re going to want to do this legally and protect yourself.
The last thing you want is to end up in court.
If you’re planning on hiring freelancers you’ve worked with before, then this is going to be a lot easier.
And if you have no idea where to start, working with a great creative recruitment company is a strong route to go down.
And now we finally get to the work itself.
Because as much as starting an agency can be about everything other than the marketing work you do, the marketing work you do is still a huge part of it.
Still with me? Good!
So let’s get cracking with some killer campaigns.
When you want to make sure that you’re building out insane campaigns that not only get your clients’ results but also get industry attention, you need to be clear on what you’re looking to create.
It’s important that you’re on the same page as your clients here.
So you need to both understand what they are looking for in terms of results and manage their expectations.
When you’re getting everything from the budget to the target audience ironed out with your ad campaign, you need to make sure that it’s clear.
Then, the fun can begin!
Remember, you’re also going to want to get creative here.
If you want your advertising campaigns to get attention, they need to stand out.
And not just standing out for the sake of it – but be smart, sophisticated, or make people think.
It’s also fun to think outside the box.
You only have to take a look at some of the best ad campaigns ever created to see how it’s done.
And if one of your goals is to win awards, you’re going to want to really double down on this one!
Of course, you then need to optimise as you’re going forward.
Even if some of your initial ideas don’t get the kind of traction you wanted, you can try again.
Split testing, tweaking copy, trialling different creative – it’s all part of the job!
And that’s the fun of it!
Ultimately, the optimisation side of things is often what gets the best results.
Making those tiny changes to reflect the initial results you’re getting can be what makes it all click.
Now we want to get down to business with how you’re planning on getting some business!
In some cases, you may already have some clients lined up before you start.
Well done you!
But if that hasn’t happened, don’t worry.
Because you always need to be marketing your agency no matter what.
Whether you’re doing done-for-you (DFY) marketing services or you’re offering something that’s scalable, your marketing is a huge must.
From building your brand to raising awareness of what you do to creating sales, it matters.
So let’s look at the best way to approach it.
Your agency should always be your first client.
After all, you’re in the business of marketing – so there’s zero excuse for you not marketing your business.
You’re great at it, so naturally you should be able to get insane results for yourself.
Just like you would your other (okay… actual!) clients, you need to create a full campaign plan for your own marketing.
Objectives, strategy, ads, social content, SEO, PPC – the works!
Or whatever is in your remit right now.
As long as you’re actively working on your online presence and marketing strategy – and consistently – it’ll pay off.
Oh, and one of the biggest reasons this matters so much (aside from the fact that it’ll land you new business) is that it’s quite literally an advertisement of what you can do.
Marketing your business as an agency is showcasing your skills.
If your ads get attention, clients will be impressed.
If your campaign is smart, clients will be impressed.
There’s nothing worse than an advertising agency with terrible (or – shock! – zero!) marketing.
It’s not a good look.
So getting your marketing underway is such a simple way for you to not only drum up business but be your own walking advertisement!
The heart of any ad agency is always its clients.
Managing clients is such an important part of the process.
Because without them, there’s no revenue.
And no revenue means no business!
So the way you choose to look after your clients is vital.
There are three very simple ways you can do this:
Communicating well, often, and effectively with your clients is a non-negotiable.
A lot of problems, errors, and misunderstandings can be avoided when you make clear and regular communication your priority.
You may want to have a dedicated person who deals with this, or assign set people to work on set client accounts.
Either way, it’s all about keeping clients in the loop, having clear channels of communication, and looking to build and keep their trust.
Client relations in your ad agency will seriously get easier when you focus on having the right touch points in place.
Along with making sure that you’re all communicating regularly, it helps to work on your relationship with them too.
Because this is the thing about client relations.
It’s not just about telling them what you’re up to.
When you’re handling their advertising, they’re playing a lot of trust in you.
They want to make sure that you not only care about the work that you’re doing for them, but that you care about them as a business too.
This is where relationship building comes in.
Entertaining your clients, taking an interest in them and their lives, looking to find common ground – all of it can be so effective in long-term agency-client relationships.
It also makes the job a lot more fun too.
Why wouldn’t you want to be friends with and build incredible relationships with the people you work with?
Starting an agency doesn’t have to be robotic – you can make it a great part of your life!
And, of course, you need to make sure that your reporting is top notch too!
Yes, it pays to be on great terms with your clients – but they’re probably not going to be all that interested in being friends if you’re not nailing the work!
But this isn’t just about getting results.
You’ll want to make sure that your method of reporting is easy, showcases everything they need to see, and is easy to digest.
So think about how you’ll do this.
Will you create a dashboard for them to access? Will you host meetings? Will you communicate with them via an instant chat or project management software?
Understanding how you’re going to do this can really help to make the client relations side of things so much easier.
If there’s one final thing that you need to know about how to start an ad agency it’s that growing it is essential.
It’s not enough to just get set up and maintain.
After all, you need to first breakeven and then make a profit!
And ideally, you’ll want to be growing year on year.
Here’s how to do it.
First, you have your business development activities.
This is likely to be what you’ll start off doing too.
You’ll want to have a sales plan from the start to help you generate leads and sign clients.
You’ll need to pitch your services to clients – sometimes that will involve a pitch deck.
But before you get to that stage, you need to generate interest with your marketing or consider direct sales.
Maybe you’ll hire a sales pro for this or you’ll dabble it in yourself.
Either way, you need to make sure that you’re looking for avenues to generate business and get clients in the door.
One of the ways you can open up new opportunities for growth is through networking.
It sounds scary, but it can be a lot of fun.
Going to industry events, building a personal brand on LinkedIn, connecting with others on social media, attending awards, and putting yourself out there can make a huge difference here.
But it’s a huge part of the business and it does get to be one of the most enjoyable parts.
Not only will you be able to seek out new clients, but you’ll meet a lot of interesting people and make great connections in general.
As much as learning how to start an advertising agency can seem like a minefield, most of it is actually enjoyable.
Just remember to go step by step to make it digestible.
And before long, you’ll be all setup and signing your first client!
