Currently, there are over 4.48 billion email users today. Further, the report shows that in 2023, approximately 347.3 billion emails were sent and received per day. The number is expected to keep rising and hit 361.6 billion this year.
Also, a report from Litmus shows email marketing is very cost-effective — for every $1 spent on marketing, there’s a $36 ROI.
These statistics show that starting an email marketing agency is viable, but how do you start one?
We’ll guide you through the essential steps to start an email marketing agency.
TL;DR – How to Start an Email Marketing Agency
In a rush? Here’s a quick list of 12 steps to start an email marketing agency that we’ll cover in detail later in the blog.
- Identify Your Target Market and Clientele
- Develop a Unique Selling Proposition (USP)
- Establish the Legal Structure
- Create a Business Plan
- Determine the Pricing Strategy
- Identify Core Services
- Build Your Team
- Pick the Best Email Marketing Tools
- Find and Acquire Clients
- Manage Client Relationships and Deliver Results
- Scale Your Email Marketing Agency
- Measure Success and Key Performance Indicators (KPIs)
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What is an Email Marketing Agency?
An email marketing agency has a team of experts and an array of skill sets to develop, execute, and manage email marketing strategies.
It helps its clients:
- Plan and execute email campaigns
- Segment and manage email lists
- Design emails and copywriting
- Automate email campaigns
What Does an Email Marketing Agency Do?
Here’s a list of the services and responsibilities that an email marketing company usually offers:
- Market Research: Email marketing agencies research the target market to understand their needs. This helps them segment the audience and create personalized emails that get the most conversions.
- Build Welcome and Follow-Up Emails: They build long-lasting connections by creating engaging welcome and follow-up emails.
- Promotional Campaigns and Newsletters: They create valuable and informative content to keep the readers engaged and drive sales. The content is targeted towards specific audiences and may also recycle content from videos, blogs, or reports into emails.
- Email Design: An email agency even develops professional email designs while aligning them with a particular brand image.
- Email Copywriting: Their copywriting team usually has extensive skills in creating eye-catching subject lines, CTAs, and persuasive content that keeps readers glued.
- Conduct A/B Split Testing: They can segment email lists and send different variations of an email to help understand which variables have better open rates or conversions.
- Analytics: They constantly monitor email metrics and identify improvement opportunities.
What Makes a Good Email Marketing Agency?
The difference between an average and a leading email marketing agency is the latter has specialized in unlocking the potential of email marketing.
Here’s what makes a good email marketing agency.
- Great Reputation and Social Proof: A good marketing agency has a track record of working with several clients and contributing to their success. It also has real client testimonials, sample emails, and case studies with actual client results.
- Targeted Campaigns: Your expertise in email marketing for businesses should reflect on the email designs and unique campaigns that the target audience best responds to. It also means having systems in place to test campaigns to maximize deliverability.
- Provides Comprehensive Reports: A good agency sends regular reports, presents the metrics, and provides valuable insights on areas of improvement. It’s crucial always to keep your clients in the loop on the progress.
- Uses Email Marketing Tools: A great agency leverages email software and implements automated workflows to improve campaign performance.
- Creativity: A good agency has a team that can think outside the box and create campaigns that capture the target audience’s attention.
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How to Start an Email Marketing Business
Here’s a step-by-step guide to help you start your email marketing business.
1. Identify Your Target Market and Clientele
Every successful agency starts by conducting market research and pinpointing its target customers. You must research and analyze who your customers are — their needs, preferences, and pain points.
Once you understand your segment of clients, you can create customized email marketing solutions that solve their pain points.
2. Develop a Unique Selling Proposition (USP)
Now that you have a profile of your target customers, you should show them that your services meet their needs and solve their problems.
Develop a compelling, unique selling proposition (USP) that shows your customers why they should buy from you. Keep your USP simple, highlighting the benefits of working with your agency.
When done well, your USP will differentiate your email marketing services from those of your competitors.
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3. Establish the Legal Structure
Before starting your email marketing agency, you must choose your business structure. It influences other aspects of your business, like taxes and personal liability.
Various business structures exist, each with its own set of legal and tax implications. The most common types include:
- Sole Proprietorship
- Partnership
- Limited Liability Company (LLC)
- Corporation
Choosing the right structure will impact several key business areas.
4. Create a Business Plan
A well-written business plan directs your agency’s daily operations.
However, to create a business goal, you must first establish your niche market and competitors. It’s also essential to set reasonable and achievable goals.
Here’s a highlight of some of the elements of a business plan.
- Executive Summary: It outlines your mission and vision statements, a brief description of your services, objectives, the keys to success, and an overview of the finances.
- Business Summary: This showcases your company name and legal structure, your company owners, the business location, and your startup history.
- Products and Services: In this section, you should explain email marketing services in detail. Highlight how they will differ from your competitors. Capture your intended pricing strategy and how you’ll deliver your services. It’s essential to explain your marketing and sales plan.
- Market Analysis: This is an overview of your industry and market trends, your target market and competitive advantage, a list of your competitors, and the barriers that may prevent your entry into the market.
- Financial Plan: Here, you should explain your revenue streams, projected cash flow statement, and financial ratios. Also, write down the projected income statement and the balance sheet.
5. Determine the Pricing Strategy
Pricing your email marketing services isn’t easy when several factors must be considered. Some factors include.
- List Size: The bigger the email list you send, the more your agency will incur (regarding your choice of automation tools and paying for expertise).
Thus, you should factor in the email list size when pricing.
- Email Design: Customized email designs take time and costs to achieve. So, you should charge more to create custom, eye-catching email designs than plain text-based emails.
- Campaign Frequency: The simple rule is — the more frequently you run an email campaign, the higher you should charge.
Next, let’s explore some standard agency marketing services pricing models to help you make an informed decision.
Pay-Per-Email
As the name suggests, you can charge a set fee for each email design and send. With this pricing model, you can accommodate clients with a low volume of emails or clients on a tight budget.
Pros
- It’s easy to add more emails without renegotiating the contract.
- The billing is transparent — your clients know precisely what they are paying for.
Cons
- There’s a greater risk of clients terminating the services.
- A low email list leads to lower earnings for your agency.
Monthly Retainer
In a monthly retainer pricing model, you can charge a recurring monthly fee. It’s a standard pricing approach, providing you with a steady income.
Pros
- It takes time to implement and optimize an email marketing strategy. So, with this model, your agency can monitor and improve the performance of your campaigns.
- It’s also a great pricing model that fosters long-term relationships.
- Your agency can plan ahead since there’s a guaranteed income.
- There’s a lower risk of clients terminating their services, so your agency can implement long-term marketing strategies.
Cons
- There’s a risk of overworking if your clients demand more from you.
Hourly Rates
Although it’s not a common pricing strategy for email agencies, it’s ideal when starting your agency or dealing with email marketing for consultants.
Pros
- Your agency is compensated for all the work they do.
- It’s easy to add more hours without renegotiating the terms.
- There’s no confusion since your clients understand the pricing.
Cons
- Faster email marketing tasks could mean low earnings for your agency.
- It can be challenging to track and report the hours.
- Hourly projects are unpredictable; hence, it’s hard to implement long-term strategies.
Custom Pricing
You can set up custom pricing for businesses or clients with unique problems. Based on the project scope, you agree on the amount before offering the services.
Pros
- One plus of this strategy is adding additional features or services at a fee.
- It’s an opportunity to win and retain high-paying clients who understand the value of great email campaigns.
- Clients understand the pricing upfront.
Cons
- Your agency can incur additional costs if the project requires more than was initially agreed upon.
- Changes to the project scope might require negotiating the contract.
How Much Should I Charge for Email Marketing?
There’s no one-size-fits-all answer to how much you should charge for your email marketing. The pricing varies depending on the factors we’ve highlighted above and the pricing model a client settles for.
6. Identify Core Services
You’ll likely see better results when your agency is niched down to a specific industry and if you position yourself as an expert in your niche.
However, you can create a full-service email marketing agency that bundles all digital services like SEO, PPC advertising, social media marketing, email marketing, and web design.
What are the Best Email Marketing Services to Offer?
You can offer automated email campaigns, lead nurturing, email designing, copywriting, email list building and management, and strategizing email campaigns.
So, depending on your expertise and interests, you must decide which services you’ll offer at your agency.
7. Build Your Team
A team is crucial to maximizing your agency’s earning potential. But before building your team, identify the key roles you need to fill — whether it’s a strategist, an email developer, or a data analyst.
Also, develop a talent acquisition strategy to attract diverse creatives, including copywriters, designers, and content writers. Have onboarding and training processes in place and strive for a productive working environment to retain quality talent.
8. Pick the Best Email Marketing Tools
Every agency needs to simplify its operations and fulfill its clients’ needs. So, incorporate tools like HubSpot, Mailchimp, and ActiveCampaign (just to name a few) to manage, run, and measure your email campaigns.
Explore different software by considering the range of features. Some tools have features like sending trigger emails based on specific actions and sending scheduled emails. Other platforms like Zoho allow you to invite your clients to see real-time data on ongoing projects.
Keep in mind each platform has a different price point. There are plenty of affordable tools that provide great functionality. However, software with advanced features will come at a higher price tag.
Be sure to choose tools that provide insights and analytics to help you understand the performance of your campaigns. Also, choose the email marketing software based on your number of customers, your client’s needs, and estimated growth.
9. Find and Acquire Clients
Generating new leads is among the common agency challenges.
First, expand your online reach by combining social media, content, and email marketing strategies. Alternatively, leverage cold calling tactics by reaching out to businesses who might need your agency’s help.
Stay active in your online communities like Facebook and LinkedIn groups, as you’ll likely interact with potential clients. Also, network and find new clients through events, trade shows, and conferences. You can also get recommendations from people you have a close relationship with.
Once you’ve identified your prospects, demonstrate your talents and experience. So, develop a portfolio to prove you’ve handled similar projects and achieved excellent results.
10. Manage Client Relationships and Deliver Results
Maintaining your current clientele is as crucial as getting new customers. First, create a streamlined onboarding process for new clients. Then, create effective and tailored marketing campaigns for clients.
Besides, listen actively to their needs, provide regular updates on ongoing projects, and promptly respond to their questions.
Remember to monitor and analyze campaign results to inform the next course of action.
By providing excellent services and superb customer services, you’ll foster trust and build long-term connections, which can lead to referrals or repeat clients.
Ongoing client relationships also mean you’ll have recurring revenue.
11. Scale Your Email Marketing Agency
One of the strategies to expand your agency is launching new service offerings. Besides, you can charge more and strive for positive client experiences.
As you scale your agency, maintain outstanding customer service, and nurture existing client relationships. Besides, empower your team to create unparalleled email campaigns. Encourage feedback and promptly respond to their concerns.
12. Measure Success and Key Performance Indicators (KPIs)
You need to know if your email marketing campaigns are successful. Besides, you have to measure and showcase the results of your marketing efforts to retain your customers and expand your customer base.
There are over 30 agency metrics you should know. Let’s explore a few of them.
- Open Rate: While it’s a positive signal when there’s a higher open rate, this metric can be misleading. Use it as a comparative value rather than a success value.
- Unsubscribe Rate: This metric shows how many email recipients have unsubscribed from your emails. If too many people are unsubscribing, your emails may not be appealing enough.
- Email Conversion Rate: This metric shows the recipients who clicked on a link and completed the desired action, such as purchasing a product. If the conversion rate is high, it shows the success of your emails in generating leads or prospects.
- Click-through Rate: This is the percentage of readers that clicked on the links in an email. Your email content isn’t persuasive enough if you have a high open rate and low click-through rate.
- Bounce Rate: For email campaigns that link to landing pages, check the bounce rate – the percentage of visitors who land on the pages but leave without taking action.
- If many readers bounce off your page, your email and page content do not align.
If many readers bounce off your page, your email and page content do not align.
How Do I Start a Cold Email Marketing Agency?
The step-by-step process of starting a cold email marketing agency is similar to the one discussed above.
A few points to remember are:
- Start a cold email marketing agency in a niche in which you’re an expert. That way, you know what it takes to generate leads in that industry.
- Next, devise KPIs and metrics your agency will be tracked on, for instance, the number of meetings booked.
- Contact your existing network and offer cold email services at a discount. Don’t forget to gather case studies showing your results.
Are Email Marketing Agencies Profitable?
When it comes to the profitability of agencies, the answer is that it depends on several factors. An email marketing agency can be profitable depending on the pricing model, the competition, and the effectiveness of the services offered.
Frequently Asked Questions (FAQs)
Check the FAQ section below, which answers commonly asked questions regarding email marketing for agencies.
Can Email Marketing Be a Side Hustle?
Offering email marketing services can be an excellent opportunity to earn some side money. Decide on the email marketing areas that interest you and equip yourself with the relevant skills by enrolling in online courses in email marketing.
However, you must stay current with market trends and new email marketing tactics. Plus, you must keep up with competition from well-established email marketing agencies.
How Do Email Marketers Get Paid?
Email marketers get paid through a salary or commission, affiliate marketing, promoting their products or services, paid subscriptions, advertisement, and sponsorships.
As a marketer, you can also get paid through freelancing, consulting, or lead generation for other companies.
Is Email Marketing Oversaturated?
No! Email marketing is not oversaturated.
Statistics show that 94% of marketers have found email marketing effective in reaching their goals. With this in mind, email marketing continues to be a strategic and powerful tool for all businesses.
Conclusion
As you’ve seen, a lot goes into starting an email marketing agency. Follow the steps we’ve covered above to start and grow your agency correctly.
Are you feeling intimidated by the process of starting an agency? Enroll in our coaching programs.
At Prospecting On Demand, we equip you with skills, practical insights, and tailored support each step of the way. We’ll help you define your USP, implement strategies to win and retain high-paying clients 5x more and charge clients 3x more.
Are you interested in starting and scaling your email marketing business? Schedule a free agency assessment and make your dream agency a reality!