Digital Marketing Agency Business Plan Template
If you want to start a new Digital Marketing Agency or expand your current Digital Marketing Agency, you need a business plan.
The following business plan template gives you the key elements to include in a winning plan for your own digital marketing company. This digital marketing business plan can be used for a full-service digital marketing agency, social media marketing agency, email marketing agency, creative agency, or another type of agency that provides marketing and/or advertising services. In addition to this template, conducting market research for your target market will help you identify potential market trends and customer segments to better understand the viability of your digital marketing agency.
Digital Marketing Agency Business Plan Example
I. Executive Summary
Business Overview
[Company Name], located in [insert location here], is a full service digital marketing agency that helps businesses attain their marketing and sales goals. The Company focuses on branding, lead generation, customer acquisition, and customer retention. From SEO to social media management, the Company creates custom digital marketing solutions and strategies that perfectly fit its client’s businesses and industry. The Company’s goal is to become one of the leading digital marketing agency brands and compete with the leaders in the industry.
Services
[Company Name] will provide a variety of services to its clients. Its services include:
- Search engine optimization (SEO)
- Video advertising
- Lead generation
- Email marketing
- Digital display advertising
- Social media management
- Other related digital marketing advisory and consulting services
Customer Focus
[Company Name] will primarily serve entrepreneurs and start-ups, corporate organizations, as well as small businesses within a 100-mile radius of the business location. The demographics of these customers are as follows:
- 510,000 corporations and small businesses
- Average income of $80,000
- 50% in Mgt./Professional occupations
Management Team
[Company Name] is led by [Founder’s name], who has been in the digital marketing industry for [x] years. [Founder] is a certified and licensed digital marketing expert. He has extensive experience working for leading digital marketing agencies prior to starting his own digital marketing agency. He will have the help and support of his business partner, [Insert Name], who will handle the admin tasks for the company.
Success Factors
[Company Name] is qualified to succeed due to the following reasons:
- There is currently a high demand for digital marketing services in the community. In addition, the company surveyed the local population and received highly positive feedback pointing towards an explicit demand for the services, supporting the business after launch.
- There has been significant growth in digital marketing over the past few years. Those who cater to this market have been thriving.
- The management team has a track record of success in the digital marketing business.
- The digital marketing business is a proven, successful business in the United States.
Financial Highlights
[Company Name] is currently seeking $190,000 to launch a digital marketing agency. Specifically, these funds will be used as follows:
- Office build-out and Startup costs: $100,000
- Working capital: $90,000 to pay for marketing, equipment and salaries.
Top line projections over the next five years are as follows:
| Financial Summary | FY 1 | FY 2 | FY 3 | FY 4 | FY 5 |
|---|---|---|---|---|---|
| Revenue | $560,401 | $782,152 | $1,069,331 | $1,379,434 | $1,699,644 |
| Total Expenses | $328,233 | $391,429 | $552,149 | $696,577 | $776,687 |
| EBITDA | $232,168 | $390,722 | $517,182 | $682,858 | $922,956 |
| Depreciation | $7,000 | $7,000 | $7,000 | $7,000 | $7,000 |
| EBIT | $225,168 | $383,722 | $510,182 | $675,858 | $915,956 |
| Interest | $6,016 | $5,264 | $4,512 | $3,760 | $3,008 |
| Pre Tax Income | $219,152 | $378,458 | $505,670 | $672,098 | $912,948 |
| Income Tax Expense | $76,703 | $132,460 | $176,985 | $235,234 | $319,532 |
| Net Income | $142,449 | $245,998 | $328,686 | $436,864 | $593,416 |
| Net Profit Margin | 25% | 31% | 31% | 32% | 35% |
II. Company Overview
Who is [Company Name]?
[Company Name], located in [insert location here], is a full service digital marketing agency that helps businesses attain their marketing and sales goals. The Company focuses on branding, lead generation, customer acquisition, and customer retention. From SEO to social media management, the Company creates custom digital marketing solutions and strategies that perfectly fit its client’s businesses and industry. The Company’s goal is to become one of the leading digital marketing agency brands and compete with the leaders in the industry.
[Company Name]’s History
[Founder’s Name] is an entrepreneur with a passion for digital marketing who seeks to provide a one-of-a-kind upscale marketing experience. [Company Name] will become a well-known digital marketing company in [Location].
[Founder’s Name] has selected an initial location and is currently undergoing due diligence on each property and the local market to assess the most desirable location for the digital marketing agency.
Since incorporation, the company has achieved the following milestones:
- Developed the company’s name, logo, and website
- Determined the list of services to be offered
- Determined equipment requirements
- Began recruiting key employees with experience
[Company Name]’s Services
The Company will be offering the following products and services:
- Search engine optimization (SEO)
- Video advertising
- Lead generation
- Email marketing
- Digital display advertising
- Social media management
- Other related digital marketing advisory and consulting services
III. Industry Analysis
[Company Name] competes against small, individually owned digital marketing agencies and major regional or national chains. There are 5,523 digital marketing agencies businesses in the U.S. The number of businesses in the digital marketing agencies industry in the U.S. has grown 13.7% per year on average over the last five years.
The primary positive factor affecting this industry is the demand driven by the target audience to market and promote their content, products, and services online, which in turn is driving the growth of the digital marketing industry. The rising number of end-users in North America for online shopping is also projected to open wider opportunities for advertisers to promote their products online, thereby increasing regional market growth.
IV. Customer Analysis
Demographic Profile of Target Market
[Company Name] will serve entrepreneurs and start-ups, corporate organizations, as well as small businesses in the [Location] area. Over time, the company expects that it will gain regional and national recognition.
The precise demographics of the town in which the retail location resides is as follows:
| Total Businesses | 38,124 |
|---|---|
| Forestry, Fishing, Hunting, and Agriculture Support | 0.29% |
| Mining | 0.35% |
| Utilities | 0.23% |
| Construction | 9.64% |
| Manufacturing | 4.16% |
| Wholesale Trade | 5.62% |
| Retail Trade | 14.54% |
| Transportation and Warehousing | 2.83% |
| Information | 1.81% |
| Finance and Insurance | 6.56% |
| Real Estate and Rental and Leasing | 4.75% |
| Professional, Scientific and Technical Services | 11.36% |
| Management of Companies and Enterprises | 0.69% |
| Admin, Support, Waste Mgt, Remediation Services | 5.15% |
| Educational Services | 1.20% |
| Health Care and Social Assistance | 10.80% |
| Arts, Entertainment and Recreation | 1.66% |
| Accommodation and Food Services | 8.59% |
| Other Services (Except Public Administration) | 9.78% |
Customer Segmentation
The Company will primarily target the following customer segments:
- Entrepreneurs and Start-Ups: This segment will need a different approach to digital marketing as it is one thing to market and promote an established corporation and a totally different one to do the same for a start-up.
- Corporate Organization: The Company will be looking forward to serving corporate organizations to help them increase their brand awareness and generate new business leads.
- Small Businesses: Small businesses that need to increase their reach in the local, national and international markets will make an important market segment for the company.
V. Competitive Analysis
Direct & Indirect Competitors
H2 Marketing
H2 Marketing is the city’s most well-known digital marketing company and has been in business for xx years. H2 Marketing specializes in transforming mission-driven organizations through marketing and digital communications. H2 Marketing offers quality social media, content, and video advertising services. H2 Marketing works with both small and large businesses to help them enhance their business and optimize their bottom lines.
Digital Media Pros
Digital Media Pros has been in the industry since 2010, catering to various groups of customers. Digital Media Pros focuses on both organic and paid marketing to enhance the growth of its clients. Digital Media Pros is dedicated to bringing customers’ business visions to life through its knowledge and experience.
DigiStars
DigiStars was established in 2012 and is known for its transparent work and real-time results for its clients. DigiStars mainly focuses on lead generation, sales strategy, and business growth, but also provides ancillary services.
Competitive Advantage
[Company Name] enjoys several advantages over its competitors. These advantages include:
- Management: The Company’s management team has x years of digital marketing experience that allows them to serve customers in an improved and sophisticated manner than the competitors.
- Relationships: Having lived in the community for xx years, [Founder’s Name] knows all of the local leaders, media, and other influencers. Furthermore, he will be able to draw from his existing personal and professional relationships to develop an initial client base.
- Location: [Company Name]’s location is near the center of town, giving the company access to budding artists, corporate organizations, entrepreneurs, and small businesses.
VI. Marketing Plan
The [Company Name] Brand
[Company name] seeks to position itself as a respectable, upper-middle-market competitor in the digital marketing industry. Customers can expect a good-quality marketing experience for their brands.
The [Company Name] brand will focus on the Company’s unique value proposition:
- Convenient location.
- Offering a wide variety of high-quality services to entrepreneurs, corporate organizations, and small businesses.
- Providing excellent customer service and customer experiences with high-quality marketing services.
Promotions Strategy
[Company Name] expects its target market to be the entrepreneurs and start-ups, independent celebrities, corporate organizations, and small businesses. The Company’s promotions strategy to reach the audience includes:
Pre-Opening Events
Before opening the digital marketing company, [Company Name] will organize pre-opening events designed for prospective customers and press contacts. These events will create buzz and awareness for [Company Name] in the area.
Advertisement
Advertisements in print publications like newspapers, magazines, etc., are an excellent way for businesses to connect with their audience. The Company will advertise its company offerings in popular magazines and news dailies. Obtaining relevant placements in industry magazines and journals will also help in increasing brand visibility.
Public Relations
[Company Name] will hire an experienced PR agency/professional(s) to formulate a compelling PR campaign to boost its brand visibility among the target audience. It will look to garner stories about the company and its services in various media outlets like podcasts, television stations, radio shows, etc.
Social Media Marketing
Social media is one of the most cost-effective and practical marketing methods for improving brand visibility. The Company will use social media to develop engaging content and post customer reviews that will increase audience awareness and loyalty.
Word of Mouth Marketing
[Company name] will encourage word-of-mouth marketing from loyal and satisfied clients. The Company will use recommendations and word-of-mouth marketing to grow the customer base through the network of its existing customers.
Pricing Strategy
[Company Name]’s pricing will be moderate, so customers feel they receive great value when availing of the digital marketing services. The customer can expect to receive quality services at a more affordable price than what they pay at an ultra-premium digital marketing company.
VII. Operations Plan
Functional Roles
To execute on [Company Name]’s business model, the company needs to perform many functions, including the following:
Service Functions
- Business Development
- Ad executive
- Creative executive
- Administrative assistant
Administrative Functions
- General & administrative functions including legal, marketing, bookkeeping, etc.
- Hiring and training staff
Milestones
[Company Name] expects to achieve the following milestones in the following [] months:
| Date | Milestone |
|---|---|
| [Date 1] | Finalize lease agreement |
| [Date 2] | Design and build out [Company Name] |
| [Date 3] | Hire and train initial staff |
| [Date 4] | Kickoff of promotional campaign |
| [Date 5] | Launch [Company Name] |
| [Date 6] | Reach break-even |
VIII. Management Team
Management Team Members
[Company Name] is led by [Founder’s name], who has been in the digital marketing industry for [x] years. [Founder] is a certified and licensed digital marketing expert. While [Founder] has never run a digital marketing business himself, he has been active in the industry as he has worked for leading digital marketing companies as a digital marketing expert and managed it for xx years.
[Founder] graduated from the University of ABC, where he majored in digital marketing.
Hiring Plan
[Founder] will serve as the CEO. In order to launch the digital marketing agency, the company will need to hire the following personnel:
- Creative Director
- Digital Marketing Specialist
- Human Resources Manager
- Web Designer
- Content Creator
- Sales Executive
- Accountant
IX. Financial Plan
Revenue and Cost Drivers
[Company Name]’s revenues will come from:
- Search engine optimization (SEO)
- Lead generation
- Email marketing
- Digital display advertising
- Social media management
- Other related digital marketing advisory and consulting services
The major costs for the company will be staff salaries. In the initial years, the company’s marketing spend will be high, as it establishes itself in the market. [Company Name].
Capital Requirements and Use of Funds
[Company Name] is currently seeking $190,000 to set up its digital marketing agency. The capital will be used for funding capital expenditures and location build-out, hiring initial employees, marketing expenses, and working capital.
Specifically, these funds will be used as follows:
- Office build-out and Startup costs: $100,000
- Working capital: $90,000 to pay for marketing, equipment and salaries.
Key Assumptions
The following table reflects the key revenue and cost assumptions made in the financial model:
| Average Number of Clients | |
|---|---|
| FY 1 | 42 |
| FY 2 | 63 |
| FY 3 | 96 |
| FY 4 | 162 |
| FY 5 | 243 |
| Annual Rent | $36,000.00 |
5 Year Annual Income Statement
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | ||
|---|---|---|---|---|---|---|
| Revenues | ||||||
| Product/Service A | $151,200 | $333,396 | $367,569 | $405,245 | $446,783 | |
| Product/Service B | $100,800 | $222,264 | $245,046 | $270,163 | $297,855 | |
| Total Revenues | $252,000 | $555,660 | $612,615 | $675,408 | $744,638 | |
| Expenses & Costs | ||||||
| Cost of goods sold | $57,960 | $122,245 | $122,523 | $128,328 | $134,035 | |
| Lease | $60,000 | $61,500 | $63,038 | $64,613 | $66,229 | |
| Marketing | $20,000 | $25,000 | $25,000 | $25,000 | $25,000 | |
| Salaries | $133,890 | $204,030 | $224,943 | $236,190 | $248,000 | |
| Other Expenses | $3,500 | $4,000 | $4,500 | $5,000 | $5,500 | |
| Total Expenses & Costs | $271,850 | $412,775 | $435,504 | $454,131 | $473,263 | |
| EBITDA | ($19,850) | $142,885 | $177,112 | $221,277 | $271,374 | |
| Depreciation | $36,960 | $36,960 | $36,960 | $36,960 | $36,960 | |
| EBIT | ($56,810) | $105,925 | $140,152 | $184,317 | $234,414 | |
| Interest | $23,621 | $20,668 | $17,716 | $14,763 | $11,810 | |
| PRETAX INCOME | ($80,431) | $85,257 | $122,436 | $169,554 | $222,604 | |
| Net Operating Loss | ($80,431) | ($80,431) | $0 | $0 | $0 | |
| Income Tax Expense | $0 | $1,689 | $42,853 | $59,344 | $77,911 | |
| NET INCOME | ($80,431) | $83,568 | $79,583 | $110,210 | $144,693 | |
| Net Profit Margin (%) | - | 15.00% | 13.00% | 16.30% | 19.40% |
5 Year Annual Balance Sheet
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | ||
|---|---|---|---|---|---|---|
| ASSETS | ||||||
| Cash | $16,710 | $90,188 | $158,957 | $258,570 | $392,389 | |
| Accounts receivable | $0 | $0 | $0 | $0 | $0 | |
| Inventory | $21,000 | $23,153 | $25,526 | $28,142 | $31,027 | |
| Total Current Assets | $37,710 | $113,340 | $184,482 | $286,712 | $423,416 | |
| Fixed assets | $246,450 | $246,450 | $246,450 | $246,450 | $246,450 | |
| Depreciation | $36,960 | $73,920 | $110,880 | $147,840 | $184,800 | |
| Net fixed assets | $209,490 | $172,530 | $135,570 | $98,610 | $61,650 | |
| TOTAL ASSETS | $247,200 | $285,870 | $320,052 | $385,322 | $485,066 | |
| LIABILITIES & EQUITY | ||||||
| Debt | $317,971 | $272,546 | $227,122 | $181,698 | $136,273 | |
| Accounts payable | $9,660 | $10,187 | $10,210 | $10,694 | $11,170 | |
| Total Liabilities | $327,631 | $282,733 | $237,332 | $192,391 | $147,443 | |
| Share Capital | $0 | $0 | $0 | $0 | $0 | |
| Retained earnings | ($80,431) | $3,137 | $82,720 | $192,930 | $337,623 | |
| Total Equity | ($80,431) | $3,137 | $82,720 | $192,930 | $337,623 | |
| TOTAL LIABILITIES & EQUITY | $247,200 | $285,870 | $320,052 | $385,322 | $485,066 |
5 Year Annual Cash Flow Statement
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
|---|---|---|---|---|---|
| CASH FLOW FROM OPERATIONS | |||||
| Net Income (Loss) | ($80,431) | $83,568 | $79,583 | $110,210 | $144,693 |
| Change in working capital | ($11,340) | ($1,625) | ($2,350) | ($2,133) | ($2,409) |
| Depreciation | $36,960 | $36,960 | $36,960 | $36,960 | $36,960 |
| Net Cash Flow from Operations | ($54,811) | $118,902 | $114,193 | $145,037 | $179,244 |
| CASH FLOW FROM INVESTMENTS | |||||
| Investment | ($246,450) | $0 | $0 | $0 | $0 |
| Net Cash Flow from Investments | ($246,450) | $0 | $0 | $0 | $0 |
| CASH FLOW FROM FINANCING | |||||
| Cash from equity | $0 | $0 | $0 | $0 | $0 |
| Cash from debt | $317,971 | ($45,424) | ($45,424) | ($45,424) | ($45,424) |
| Net Cash Flow from Financing | $317,971 | ($45,424) | ($45,424) | ($45,424) | ($45,424) |
| SUMMARY | |||||
| Net Cash Flow | $16,710 | $73,478 | $68,769 | $99,613 | $133,819 |
| Cash at Beginning of Period | $0 | $16,710 | $90,188 | $158,957 | $258,570 |
| Cash at End of Period | $16,710 | $90,188 | $158,957 | $258,570 | $392,389 |
