Social Media Marketing is great. As soon as social media was a concept, it didn’t take long for people to realise they could sell their stuff on these platforms. Facebook started in 2004. By this time, the Google ads platform had been providing serious Search Engine Marketing results for 4 years already. Businesses had already began forming and basing their services around helping businesses sell online.
In 2007, Facebook released their advertising platform – it was called Flyers. In the beginning, it was an extremely cheap way to market yourself, your services or your products. It became Facebook’s prime source of revenue, and continues to be their cornerstone, which is why Facebook (and every other advertising platform) is currently feeling the impact of the coronavirus – because they rely heavily on businesses spending money on advertising.
Digital marketing agencies have been around years. Way before Google ads, there were email marketing specialists. It’s not a new concept.
Nowadays, there are so many digital marketing agencies, and the list of agencies that offer social media marketing continues to grow. It’s safe to say there’s a lot of competition, especially in the social media marketing space.
Why is there lots of competition? Well, one main reason I can think of is that it’s a fairly low barrier to entry. It doesn’t require genius levels of technical skills to post on social media – whereas Google ads and Facebook ads involve some more technical abilities than posting. What is really, really challenging is translating advertising spend into sales. The only way to do that is to test and to tweak the way you do things, and the only way to do that by finding someone who’s willing to put their trust in you and to give you money in the hope that you’ll get them a return on their investment.
So if you’re just starting out, finding clients is another big issue, because as I mentioned, people need to trust you. What builds trust? Well first of all, it helps if someone likes you or your brand. A track record, case studies and proof of ROI will help, too. And if you’ve come highly recommended, that will certainly hold some weight. So if they like you or your company, or you have a track record of getting an ROI for other businesses, or if they’ve been referred to you by another business owner or friend, then you’ve got a much higher chance of working with them. If you have none of the above, then you’ll have the best chance of partnering with someone by showing up to their business and speaking with them. We have never managed to get new business with cold calling or emails, yet.
Once you have a few clients on board and you’re off to a rolling start, it’s time to scale. Picture this:
Your clients are happy with the services you provide, and you’re seeing a return on investment. You’re so busy but you’re earning a good amount of money each month, so you decide to hire someone. Then, all of a sudden, your ads and posts and all your other efforts are not translating into sales like they used to. You’re just so focused on managing your new employee. You’re simply not seeing the return on investment that once made you a reputable digital marketing agency. Clients start to drop off, you’re getting paid less, and before you know it you’re left picking up the pieces because you still have to pay a wage.
That’s the issue with scaling a social media marketing agency, in a nutshell. It’s a balancing act between doing what you do best, and teaching someone else to do it – all whilst continuing to manage the expectations you set for your clients from the outset.
Why even start a social media marketing agency? I did write this post, but I’ll cover one or two of the most important reasons here:
You make more money when you make your clients more money. They WILL 100% spend more on your services if you’re making them a significant return on their marketing investment. Let’s say someone pays you £1,000 per month, and you make them £2,000 per month. That’s a 2:1 ROI. They’re not going to spend any more money with you if that’s all you’re making them. They’re only making an extra £1,000 per month which actually works out to be much less when you consider the time they spend communicating with you. But if you are generating a solid 5:1 ROI for your clients, then you can confidently increase your rates. The key here is to build transparent relationships with your clients from the get go so you can track exactly how much money you’re making them, and ultimately work out your ROI ratio (if you know this ratio, it is also worth mentioning when prospecting).
And finally, the most important reason to start a SMMA is because it gives you the opportunity to partner with people that are, hopefully, a lot more successful than you are. Learn from them, spend time with them, see how they talk, think and act. These people are usually very busy, so they might not always have the time for you, but try to get in front of them once a week. They all got to where they are from some key characteristics they developed throughout their time in business. Whether that’s managing people, negotiating or selling – how do they do it? What can you learn from them?
A Stepping Stone to Other Ventures
I’ve come to realise that the agency life is a learning process. It’s a stepping stone to other business ventures because it opens doors, provides some indirect (and possibly direct) mentorship, and enables you to learn about running a business and marketing.
Listen, you don’t want to be posting on social media for other companies when you’re 40 years old, so you’re either going to have to get someone else to do it (which as I’ve explained, comes with its own set of problems – the agency model isn’t for everyone), or you’re going to have to start another business with the money you make from running an agency.
Learn, use the business to your advantage, but don’t let it consume you. Once you have enough money rolling in to do the things you like, put your focus into doing something you do love with the spare time you d0 have. Eventually, you can transition to that.