How much does it cost to open/start/launch media buying agency

Introduction

The advertising industry has grown at an unprecedented rate thanks to the rise of digital media. According to Statista, the digital advertising industry in the United States is expected to grow to 0 billion by 2024, up from .9 billion in 2019. This growth has given rise to a plethora of business opportunities, including the one of the media buying agencies. But, with great opportunity, significant investment. Starting a media buying agency requires a considerable amount of capital, and understanding these costs is essential to successfully launching a business in this field.

The goal of this blog post is to provide you with a comprehensive breakdown of startup expenses for a media buying agency. This information will save you time and help you determine if starting a media buying agency is a viable option for you. We’ll dive into the various one-time costs you’ll cover, including market research tools and software, office space and equipment, website development and design, client management software, salaries and benefits for early employees, advertising and marketing to attract customers, legal business fees and registration, employee training and development, and technology infrastructure for managing online campaigns.

By the end of this blog post, you’ll understand the costs of starting a media buying agency, as well as the foundation needed to build a profitable business. While the upfront costs may seem daunting, it’s important to remember that investing in a solid foundation is critical to the lifespan and success of a media buying agency. Let’s dive in.

Start-up costs

Starting a media buying agency requires significant financial investment, including expenses such as market research tools, office space, salaries, and marketing. Here are the average average start-up costs associated with opening a media buying agency in the United States:

While these costs may seem steep, it’s important to remember that investing in the right resources and tools can establish a media buying agency for long-term success.

1. Market research tools and software

Market research is an essential step for any media buying agency before starting a campaign. It helps the agency understand the behavior, preferences and interests of the audience. To conduct market research, media buying agencies use a variety of tools and software.

The cost of market research tools and software could range from FREE to thousands of dollars, depending on features and functions. Some of the most popular and widely used market research tools and software include Google Analytics, Semrush, Ahrefs and the like.

Google Analytics: The tool most used by media buying agencies to track website traffic and audience behavior. It offers a free and premium version with a cost of 0,000 per year.

SEMRUSH: A tool that helps agencies conduct keyword research, track rankings, and analyze competitor ad copy. It offers different pricing plans starting from .95 per month.

Ahrefs: One of the most popular backlink analysis tools used by media buying agencies. It provides insight into competitor backlink strategies, keyword research, and content analysis. Pricing starts from /month.

Related: A market intelligence tool that gives agencies insight into competitors’ website traffic, user behavior and customer journey. The tool is priced at 9/month for the basic plan.

In addition to these, there are also many free market research tools such as Google Trends, Facebook Audiences Insights, and Twitter Analytics that agencies can use to gain insight into audience behavior and interests.

• Google Trends: A free tool that helps agencies find the latest trends in search behavior and allows them to explore related topics and queries.
• Facebook Audience Badges: A free tool that provides insight into Facebook user demographics, interests, and behavior.
• Twitter Analytics: A free tool that provides insight into audience demographics, interests, and behaviors on Twitter.

Overall, media buying agencies spend between ,000 and ,000 per month on market research tools and software.

2. Office space and equipment

The cost of office space and equipment is an important consideration when starting a media buying agency. Depending on the location, size, and quality of the office space, rent or lease costs can range from ,000 to ,000 per month . A well-equipped office with modern furniture, high-speed internet, and other conveniences can cost an additional ,000 to ,000 per month .

In addition to the office space itself, media buying agencies need to invest in the equipment and technology needed to do their job effectively. This may include computers, printers, scanners, monitors, telephones and data storage devices. According to recent estimates, the cost of outfitting a small office with basic technology and equipment can be ,000 to ,000 .

Media buying agencies also need specialized software for market research, ad campaign planning, and reporting. The cost of software can vary widely depending on the scope and complexity of agency operations. Some programs may be available for a monthly subscription fee, while others may require a one-time purchase. On average, the cost of software for a media buying agency can range from ,000 to ,000 per year.

To minimize costs, media buying agencies may consider renting or leasing equipment and software instead of buying it. This option can provide significant cost savings in the short term, but may end up being more expensive in the long run. Alternatively, agencies can opt for cloud-based software accessible from anywhere, eliminating the need for expensive hardware and software.

To sum up, the cost of office space and equipment is important when starting a media buying agency. It is essential to consider these costs when planning and budgeting for the business. Researching and comparing different options for office space, equipment, and software can help agencies minimize costs without compromising the quality of their services.

• Office space can cost between ,000 and ,000 per month.
• Additional equipment for an office can cost anywhere from ,000 to ,000 per month.
• The cost of equipment and technology can range from ,000 to ,000.
• Software costs can vary, from an average of ,000 to ,000 per year.

3. Website development and design

One of the most crucial aspects of starting a media buying agency is the development and design of its website. A professional, well-designed website is key to attracting potential clients and establishing agency credibility. According to the latest data, the cost of website development and design can range from ,000 to ,000 depending on the complexity and functionality of the website.

Custom Website vs. Templates: When it comes to developing a website, there are two options – custom or using templates. A custom website design offers more flexibility and customization to meet specific agency needs, but it can be more expensive, starting at ,000 and up. On the other hand, a website template may be cheaper, starting at ,000 and offers easy and quick customization, but it may not meet all agency requirements.

Responsive Design: With the majority of internet users accessing websites through mobile devices, responsive website design is crucial. The cost of updating a website can range from ,000 to ,500, depending on the complexity of the website.

Content Development: Creating high quality content for the website is another vital aspect of website development. The cost of creating content can range from ,000 to ,000, depending on the amount and quality of content required.

• Examples of website development costs and design costs:
• A custom designed website with responsive design and 10 pages of content can cost around ,000.
• A template-based website with responsive design and 5 pages of content can cost around ,500.
• The cost of website redesign can range from ,000 to ,000, depending on the complexity of the changes required.

In conclusion, website development and design are crucial factors in the success of a media buying agency. It is important to consider the cost of website development and design when creating a budget for the agency. A well-designed website that is easy to navigate, responsive and has high-quality content can help attract potential clients and build agency reputation and credibility.

4. Customer Management Software

One of the essential tools of any media buying agency is client management software. This software is designed to help agencies effectively manage their clients, leads, campaigns, and workflows. The cost of customer management software can vary depending on the features and capabilities offered by the software. According to recent statistics, the average cost of client management software for a media buying agency in the United States can range from -0 per month .

Some of the popular customer management software tools available in the market include HubSpot, Zoho CRM, Salesforce, Pipedrive, and Agile CRM. These tools offer a range of features such as lead management, email marketing, deal tracking, project management, and collaboration.

Most client management software tools operate on a subscription-based model, where agencies pay a monthly or annual fee to access the software. The price of these tools can vary depending on the number of users, the amount of storage and the features offered. Some tools also offer a free version with limited functionality, which can be useful for smaller agencies.

When considering client management software, it’s essential to evaluate features and functionality to ensure it aligns with your agency’s needs and priorities. Some key features to look for include lead management, pipeline management, reporting, collaboration, and integrations with other tools.

It is also essential to consider the scalability of the software, as your agency grows you may need a more advanced solution to effectively manage your clients. Some software tools may also offer features or add-ons that can be purchased separately, depending on your agency’s needs.

• Example 1: A small media buying agency with two employees might opt for a client management software tool that offers basic features such as lead management, deal tracking, and project management. They can consider using a tool like PipeDrive, which offers a low-cost subscription fee of per user, per month .
• Example 2: A larger media buying agency with ten employees may need a more robust client management software tool that offers advanced features like reporting, collaboration, and integrations with other tools. They can consider using a tool like Salesforce, which offers a range of pricing plans from -0 per user, per month .

5. salaries and benefits for initial employees

A media buying agency typically requires a team of professionals that includes account managers, media planners, media buyers, and administrative staff. Salaries for these roles vary based on experience, location, and market demand, but on average, annual salaries and benefits for the first employees of a media buying agency in the states States can be estimated as follows:

• Account Manager: An account manager with 1-3 years of experience can earn between ,000 and ,000 per year, while a more senior account manager with 5-10 years of experience can earn between 000 USD and 120,000 USD per year. In addition to base salary, account managers may receive performance-based bonuses and medical benefits.
• Media Planner: A media planner with 1-3 years of experience can earn between ,000 and ,000 per year, while a more senior media planner with 5-10 years of experience can earn between 000 USD and 100,000 USD per year. In addition to base salary, media planners may receive bonuses, 401(k) contributions, and health and dental insurance.
• Media Buyer: A media buyer with 1-3 years of experience can earn between ,000 and ,000 per year, while a more senior media buyer with 5-10 years of experience can earn between 000 USD and 90,000 USD per year. In addition to base salary, media buyers may receive commission-based bonuses, paid vacation, and health insurance.
• Administrative staff: The administrative staff of a media buying agency can include receptionists, accountants and office managers. Annual salaries for these positions typically range from ,000 to ,000, depending on experience and location.

It is important to note that these salary ranges are estimates only and may vary depending on the specific skills and experience of individual employees and market demand in their location. Additionally, a media buying agency may also offer additional benefits and incentives to attract and retain top talent, such as flexible work hours, employee wellness programs, bonuses, plans participation and equity options.

6. Advertising and marketing to attract customers

To be successful in any business, reaching the right audience and marketing the business effectively is essential. Media buying agency is no exception and they have to advertise their services to attract clients. Advertising and marketing costs are an essential aspect when it comes to launching a new media buying agency. According to the US Small Business Administration, the average cost of promoting a business that generates less than million per year is around ,000 to ,000 per month.

One of the largest costs associated with advertising and marketing is traditional advertising expenses, such as television, radio, print ads, and outdoor advertising. The cost of running a single TV ad can range from ,000 to ,000, which depends on the region, time, and particular audience segment. Similarly, the cost of a full-page ad in a print newspaper can range from 0 to ,000. Advertising costs for different media vary depending on reach, frequency, and target audience.

In today’s digital age, digital marketing has become increasingly important in attracting potential customers. Digital marketing costs include website development, search engine optimization, content marketing, email marketing, social media marketing, and paid advertising campaigns. The cost of a basic website can range from ,000 to ,000. The cost of search engine optimization, which helps businesses rank higher in Google and other search engines, can range from 0 to ,000 per month. The cost of social media marketing can vary depending on size, scope, and industry, but the average cost is around ,000 to ,000 per month.

Networking events, trade shows and sponsorships are another effective way to promote a media buying agency and attract new clients. The cost of attending industry-specific trade shows or buying a booth can range from 0 to ,000. The cost of sponsoring an industry event or conference can be more expensive, ranging from ,000 to ,000. The cost of attending networking events, joining a membership association, and hosting dinners can also add up to a media buying agency’s overall marketing budget.

Marketing collateral such as brochures, business cards, and freebies are key to leaving a lasting impression on potential customers. The cost of creating a brochure can be between 0 and ,500. The cost of business cards can range from to 0. The cost of promotional gifts can vary depending on the type of gift, but the average cost is around to per item.

• For example: A media buying agency may launch a pay-per-click advertising campaign with a budget of ,500 per month. The campaign can target specific keywords related to the advertising industry and provide compelling ad copy to attract potential customers. Campaign effectiveness can be measured by calculating the return on investment (ROI) of ad spend, such as the number of leads generated, customers acquired, and revenue earned.
• For example: A media buying agency may attend a trade show with a booth and sponsorship package that costs ,000. The agency can develop collateral materials such as brochures, business cards, and promotional items to create brand awareness and attract potential clients. The effectiveness of the show can be measured by evaluating the number of customer interactions, leads generated and new customers acquired.

7. Legal fees and business registration

When starting a media buying agency, it is important to consider the costs associated with legal fees and business registration. Costs will vary depending on the state in which the agency is formed but can range from 0 to 00 for business registration fees. It is recommended that a lawyer be hired to help with the legal process, which can cost an additional ,500 to ,500. The total cost of legal fees and business registration can be between 00 and 00.

Business Registration Fee: Business registration fee is a necessary expense for a media buying agency to operate legally. Costs may include filing fees, name reservation fees, and other state-specific fees. It is important to research the fees for the specific state in which the agency will be formed to accurately budget for this expense.

Legal Fees: Hiring an attorney to assist with the legal process is highly recommended. A lawyer can help file the necessary documents and ensure that all legal requirements are met. The costs associated with a lawyer can vary depending on the complexity of the legal process and the lawyer’s hourly rate.

Trademark Registration Fees: Trademark registration is not required but can be beneficial to protect the agency’s brand and intellectual property. The cost of a trademark registration can range from 5 to 0 and is valid for ten years.

Insurance costs: Insurance is important to protect the agency against potential liabilities. Costs associated with insurance will depend on the specific coverage needed and the size of the agency. It is recommended that you obtain general liability insurance, professional indemnity insurance and workers’ compensation insurance. Insurance costs can range from 0 to 00 per year.

• Business Registration Fee: 0 – 00
• Legal fees: 00 – 00
• Trademark registration fees: 5 – 0
• Insurance costs: 0 – 00 per year

It is important to accurately budget the costs associated with legal fees and business registration to ensure that the agency is properly registered and can legally operate. Failure to properly register the agency or obtain necessary insurance coverage may result in legal and financial consequences.

8. Training and development for employees

Training and development is essential for the growth and success of any business, including a media buying agency. In today’s dynamic business environment, employees must continuously update their knowledge and skills to stay competitive in the industry. According to the latest statistics, the average cost of employee training and development in the United States is around ,200 per employee per year.

In a media buying agency, employee training and development should be an ongoing process to keep up with fast-paced industry changes. The cost of training and development can vary depending on the type of training and the number of employees. For example, attending conferences or networking events related to the advertising industry could cost around 0 to ,000 per employee. Interactive online courses could cost around 0 to ,000 per employee, while in-person training sessions could cost around ,500 to ,000 per employee.

One of the main benefits of investing in employee training and development is that it can improve the overall performance and efficiency of the agency. Employees who receive proper training are better equipped to meet the challenges of their jobs and can provide better services to customers, leading to increased customer satisfaction and retention. Additionally, investing in employee development can also foster a positive workplace culture, improve employee morale, and reduce turnover.

Media buying agencies should also consider providing cross-functional training to employees to broaden their skills and provide career development opportunities. For example, a media buyer might benefit from learning more about market research or creating engaging ad copy to improve overall campaign performance. Providing cross-functional training can help employees understand the full spectrum of the advertising process and increase their value to the agency.

• Examples of training and development programs for media buying agency employees:
• Industry conferences and networking events
• Online courses and certifications
• In-person training sessions and workshops
• On-the-job training, mentoring and coaching
• Cross-functional training programs

In conclusion, investing in employee training and development can benefit a media buying agency in many ways, including improved performance, increased client satisfaction, and a positive workplace culture. Although the cost of training and development can vary, it should be considered a necessary expense for agency success in today’s highly competitive advertising industry.

9. Technological infrastructure for managing online campaigns

Technology infrastructure is a crucial element in the successful management of online campaigns. The cost of a technology infrastructure for managing online campaigns has increased over the years. According to recent research, the average cost for a small business to set up and maintain a basic online campaign management infrastructure is around ,000, while the cost for a medium-sized business is ,000. around ,000. Large companies can spend up to 0,000 or more on their technology infrastructure for managing online campaigns.

One of the most significant technology infrastructure costs for managing online campaigns is software license fees. The cost of software licenses varies depending on the size of the business and the type of online campaign management software required. For example, Google Adwords and Bing Ads have different pricing models, with AdWords charging a percentage of total ad spend, and Bing Ads only charging a flat fee per click.

The cost of data storage is another critical piece of technology infrastructure for managing online campaigns. Businesses need to store large amounts of data to track the performance of their online campaigns, so they require scalable data storage solutions. The cost of data storage can vary depending on how much data a business needs to store and the type of storage solutions they choose. Cloud-based storage solutions such as AWS and Azure can cost between .023 and .13 per gigabyte per month.

Another essential piece of technology infrastructure for managing online campaigns is website hosting. A website hosting solution is essential for businesses to organize their online campaigns and track their progress on their sites and landing pages. The cost of website hosting can vary depending on the type of website the company is hosting and the number of traffics the website receives. For example, shared hosting solutions can cost from to per month, while dedicated hosting solutions can cost from 0 to 0 per month.

Another important consideration when it comes to technology infrastructure for managing online campaigns is ongoing maintenance costs. These costs may include ongoing software updates and maintenance, new hardware purchases, and data backup and recovery systems. A typical small business can spend up to ,000 per year on these maintenance costs, while medium-sized businesses can spend up to ,000 per year.

In summary, technology infrastructure costs for managing online campaigns can range from ,000 for small businesses to 0,000 or more for large enterprises. Major cost drivers include software license fees, data storage costs, website hosting expenses, and ongoing maintenance costs. Businesses should carefully consider these costs and budget accordingly to ensure that their technology infrastructure can meet their online campaign management needs.

• Software license fees: variable
• Data storage costs: .023 to .13 per gigabyte per month
• Website hosting expenses: to 0 per month
• Ongoing maintenance costs: ,000 to ,000 per year

Conclusion

Starting a media buying agency is a big investment, but it can be a lucrative business model in a growing industry. Understanding the costs associated with opening a media buying agency is key to creating a solid foundation for success. Let’s recap the major costs:

• Market research tools and software
• Office space and equipment
• Website development and design
• customer management software
• Salaries and benefits for initial employees
• Advertising and marketing to attract customers
• Legal fees and business registration
• Training and development for employees
• Technological infrastructure for managing online campaigns

If you’re considering starting your own media buying agency, it’s important to plan for these expenses and make sure you have adequate funding. It’s also crucial to focus on building a strong team with the skills and expertise to deliver the results clients expect.

While there are significant upfront costs associated with opening a media buying agency, the potential for long-term success and profitability is high, especially as the digital advertising industry continues to grow. By investing in the right tools, people, and infrastructure, you can create a thriving media buying agency that delivers value to clients and grows your business.