How to Start a Social Media Marketing Agency

Written by Peter Day

How I made $20,000 My First Month by Running Facebook Ads

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You can start a social media marketing agency, even if you have absolutely NO idea where to begin!!!

With over 2.4 BILLION (and yes, Billion with a ‘B’) active Facebook users on the social media platform there is no better time to start a Social Media Marketing Agency or “SMMA” than now!

Whether you are in e-commerce, real estate, run a local service business, or you don’t have any business yet, I want to show you how you can start making money by running ads on social media today.

So who exactly is this going to be for?

  • If you’re serious about creating a long term social media marketing agency business the RIGHT WAY.
  • If you’re willing to learn a new skill set and increase your value to the current market.
  • If you’re willing to take MASSIVE action and invest in yourself and your business.
  • If you’re NOT SATISFIED with the results you’ve been getting.

If you fit into ANY of the above, then this article is for YOU!

You’re going to want to grab a coffee (or your favorite beverage of choice) and sit back and get ready to learn exactly how I made $20,000 in my first month running paid social media ads for my clients.

This is, in fact, one of my FAVORITE business models to take, for very good reasons.

So why is this so different from any other business model?

When running a Social Media Marketing Agency, there is no warehousing of inventory, no shipping or receiving, you create ads for clients and start earning money immediately.

Heck, you don’t even need to pay for an office! I get to work out of the luxury of my home; or anywhere with a wifi connection for that matter.

This isn’t like selling on Amazon, Shopify, or eBay, where you’re paying seller fees, handling logistics or managing inventory.


This simply requires some hustle, drive and a willingness to learn.

This is a brand new opportunity that the world has never seen before. I get goosebumps when talking about it to others because it is so near and dear to my heart and is so unbelievably exciting!

So without further ado, let’s hop right into this!

3 Easy steps that allow this all to happen

When it comes to Facebook there are 3 key features that allow this business model to work.

They are as follows:

Step# 1: Mastering the Facebook pixel

I love to use the word “mastering” when it comes to Facebook pixels. It sounds so professional, intrinsic and high level. Like it’s some complex thing that we need a physics degree in order to understand.

Yet, truth be told, it’s actually so user-friendly that anyone who can copy and paste a line of text can “master” the Facebook pixel.

It’s true!

What is a Facebook pixel

Okay, okay, I know I have just said that the Facebook pixel is so simple that practically anyone that can use a mouse can master it. Yet, while this still holds true, there is a deep complexity to the pixel.

Essentially, Facebook generates a unique snippet of code that we can place on our website that tracks the traffic on our website.

Luckily for us, all that high level, complex stuff occurs on Facebook’s backend, and we never have to see or worry about it. Facebook has made it so simple to use, that even someone like myself who isn’t very tech-savvy can have it up and running in a matter of minutes.

Let me give you an example of exactly what the pixel does…

Have you ever browsed the internet looking to buy some new kit? For instance, maybe you were getting ready to do a family camping trip and were checking out some new gear. Then all of the sudden your wife yells to you to get the kids ready for bed.

You decide to play it safe and do exactly as she says and close out the browser and attend to the kids.

An hour later after washing up the kids and putting them to bed, you hop on Facebook and see an ad for EXACTLY the same product you were looking at earlier!

How did they do that? How does Facebook know? What kind of black magic is this? Are they looking through my windows?

While these are all valid concerns, it’s actually a lot simpler than it appears. The website that you were previously browsing had that tiny snippet of code installed on its website that tells Facebook one of its users just viewed a product on their site.

From there, they’ve setup up what’s referred to as a “re-targeting” campaign on Facebook, in an effort to get you to go back and hopefully continue shopping.

Using integrations like this will allow you to use the same social media marketing tactics when it comes to advertising for your clients.

Step# 2: Custom Audiences

Okay, so now that we have a basic understanding of the Facebook pixel, how to install it on a website and link it back to Facebook, it’s time to talk about how to use it to its full advantage.

Every time a customer views YOUR website, or your CLIENTS website, the website gets a little bit smarter, ultimately making your advertising campaigns more profitable.

One of the many beauties of the Facebook pixel is that you can create what are referred to as “Custom Audiences”.

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A custom audience is just that.

Custom audiences that you create, based on a predefined course of actions that someone took on either your ad, or website.

Now what do I mean by this?

Facebook allows us to narrow down our audiences based on things like:

  • Interests
  • Recency window (how long it’s been since someone has done a particular action)
  • Website Traffic
  • Visitor behavior

We can select particular interests, and even exclusions when building these custom audiences. If we just used the simple demographic data, it wouldn’t yield the results we desire.

Step# 3: Look-a-like Audiences

This step allows us to combine ALL the best features that Facebook has to offer and expand our reach even further. The third step is the most interesting step in my opinion.

It’s the step that brings this whole thing together, working its social media marketing magic for us.

Before I get into it and really break it down, I want you to take a moment and think about this.

Will you ever have an infinite number of customers/website visitors checking out your website? Of course not.

As awesome as that may sound, you and I both know that isn’t very realistic. And if we keep marketing our previous website visitors over and over again, we can saturate our audience (never a good thing).

What step number three allows us to do is utilize the power of Facebook’s algorithm and create audiences that look like, or are similar to the audiences we’ve created previously.

Let’s take a look at how this works, let us say that we take ALL the visitors that have purchased from our website, we can then tell Facebook “Hey, go find 2 MILLION other people that are VERY similar to those that have purchased from us in the past”.

Facebook will start crunching some numbers and data to give us a “look-a-like” audience that we can begin marketing to. This is where the fun begins!

Bonus Step: Audience Insights

Just because I love you guys and I enjoy dropping knowledge bombs, I want to let you in on another powerful feature that is so often overlooked. It’s a tool built into the backend of Facebook’s marketing platform (completely FREE to use) and it’s called “Audience Insights”.

This is another example of just how powerful data is and how we can leverage it to work in our favor. This tool allows us to view data based on other fan pages.

So, what exactly do I mean by that?

Well, let’s say you start a social media marketing ad campaign for a dentist client. You’re not 100% sure who your targeted demographic is. Or maybe you have a good idea and just want to cross-reference it.

With audience insights, you can do just that. This tool allows us to pull up data on fan pages of other businesses and see things like:

  • Age & Gender of people that liked that page
  • Relationship Status
  • Education Level
  • Job Titles
  • Other pages people have liked
  • Location
  • What devices they use (mobile, desktop, Android, iOS, etc.)

Now tell me that having this kind of data isn’t an absolute game changer!

Bridging the Gap – Old vs. New

The other day I took some time to run a quick errand across town, something I rarely do to be honest. Not because I don’t want to or anything, but because running a social media marketing agency, I get the luxury of working from home!

During this ride, something occurred to me that I hadn’t really thought about much before.

I was sitting at a red light waiting for the light to turn green. I glanced over to my left and there was a big bright pink billboard that just happened to catch my eye. I quickly thought “Wow, what a good way for them to grab my attention.”

Being a marketer, I always admire and look at other advertising campaigns in other mediums. To see if there’s anything in there that I could implement for any of my clients.

The billboard had stuck out, it caught my attention enough for me to want to read it.

But after reading it, I quickly realized that it wasn’t even an ad I would be interested in. Unless I were buying it for someone else perhaps, yet even then, I probably wouldn’t do that.

It was a billboard for a new beauty store that had opened in recent months just down the road from where I saw it.

This company paid at LEAST $10,000 a month for this billboard to target only a handful of potential customers. That, my friends, is a lot of money just being thrown out the window.

Targeting can make or break a campaign

Targeting the right people with the right message is the key to a successful ad campaign.

Let me share with you the traditional sales funnel.

It goes a little something like this:

  • Awareness
  • Interest
  • Decision
  • Action

At the Awareness level, we use primary tools like content marketing, social media marketing, paid ads, and maybe even public relations if you’re a big enough company.

All these strategies drive awareness of the brand/company.

For interest, we use tools like e-books, blogs, free tools, case studies, and re-targeting to get customers interested in the company.

Decision is where we can use sales pages, give away free consultations & trials, or do promotions to help convince customers to make that buying decision.

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Action, this is where we need a payment system, or a shopping cart to allow the customer to complete the transaction.

Customers at each stage of the funnel are looking for something different. This is why we have different tools for each stage.

If you target someone in the “Awareness” stage with a sales call to action, you will fail.

If you target someone in the “Action” stage with an informational message, you will still probably fail.

Targeting is not simply figuring out the general demographics of your audience.

If you get any of a wide variety of traits wrong, you won’t yield the results you want, no matter how amazing your ad looks.

If you send the perfect message to the wrong audience, they won’t click it. Kind of like me seeing the great beauty billboard at the stoplight.

Proper targeting will not only make your ads more successful, but it will also lower your overall cost of running them on a social media platform like Facebook. This improves your ROI and boosts your bottom line.

That’s a win-win if you ask me!

The Technological Revolution

Don’t skip the basics

Now that we live in the 21st century, automation is king and distraction is the new currency; it’s time we use the power of Facebook’s algorithm to get the ROI for our ad spend.

When you’re setting up an ad, the first thing Facebook will ask you to do is select the location, age, and gender of your target market.

If you were to select only these three targeting options, that would be a HUGE mistake. Your audience will be way too LARGE and you’re putting yourself into the billboard category.

You certainly don’t want to ignore these options, though. Don’t be so focused on the advanced options that you skip past the basics.

Make sure you narrow down all three basic fields for every ad you create. This should be your first step for audience targeting.

Even if everyone from the ages of 18 to 65 could use your product, you shouldn’t try to speak to everyone with the same ad.

Every time you make your ad too broad, you’re setting yourself up for failure.

Target Interests

Trying to target your ideal customer based solely on demographics like age and gender isn’t going to cut it.

That’s why you need to be very specific with your targeting.

If your target audience is too large, the amount of people that will click on it will be low, and your ads will fail.

The best way to narrow down your audience is by defining the interests of your ideal customer. I mentioned earlier the power of audience insights and why you should leverage this to work in your favor.

Make sure you narrow your focus as much as possible.

The best way to do this is by selecting a specific interest that no one other than an avid fan would have.

If you want to sell to survivalists or “preppers”, don’t choose Bear Grylls. He’s so popular that even non-survivalist may be fans.

Someone like Paul Range would be a far better choice. Only serious outdoorsmen and women would know of him and like him.

There are thousands of different interests you can choose to target with Facebook Ads. Be sure to use them to your advantage.

Find people already looking to buy your product

Whether you find it creepy or not, Facebook can tell if you’ve been searching online for something.

If you sell any product or service online, this is an excellent way to target customers.

It’s estimated that approximately 70% of consumers research a product online before purchasing.

The purchase consideration window is not very large though. For most products, you have a week or less from the time a customer starts shopping until they buy.

Even for products worth more than $500, over half the people will make their decision in less than a week.

By the time two weeks have passed, over three-quarters of people will have made their purchase.

Facebook can identify not only your ideal customers, but which ones are in the looking-to-buy stage, and instantly target your ad to them.

This means even if they haven’t heard of you yet and have only been researching on competitor sites, you have a chance to steal them away before they make up their mind.

Since most consumers make up their mind based on price, a targeted Facebook Ad offering a discount could be enough to persuade them to purchase from you over the competition.

Leverage Facebook’s Resources

Did you know that Facebook actually offers FREE courses?

They offer everything from:

  • Get started with Facebook
  • Get started with advertising
  • Learn advanced buying options
  • Build awareness
  • Drive consideration
  • Generate leads
  • Promote my app
  • Increase online sales
  • Increase in-store sales
  • Choose ad formats
  • Get creative inspiration
  • Manage ads
  • Measure ad performance
  • Learn about Messenger
  • Learn about Instagram
  • Distribute and monetize content

And that’s just scratching the surface. There are MANY other FREE courses Facebook offers.

If you check out their advertising course options, you will notice that there are several basic courses to help you build a solid foundation.

They recommend that you take these courses before you get into the more advanced targeting classes.

I certainly recommend checking out all the resources Facebook has to offer for businesses out there.

Are social media marketing ads too expensive?

I’ve heard this question asked time and time again, ever since social media paid advertising began.

If you want my honest opinion, I’d still say that they are vastly under-priced.

While it is true, I have witnessed costs rise over the years, but then again what hasn’t become more expensive over time?

I still think Facebook is the most powerful platform to advertise on and it is easily the most competitive when it comes to ROI on ad spend.

When I first began to run Facebook social media marketing campaigns years ago, it was not uncommon to get leads for a business for as little as 20 – 30 cents. Now, if I really try, I am able to generate leads from anywhere between 40 and 70 cents per lead depending on the industry.

Flipping the old model upside down.

The old model used to be that we would exchange our time for money directly. One hour of your life was exchanged for ‘X’ amount of dollars. Or, even worse, you could be on a salary.

The old model told us to put money into a retirement account and after about 50 years we could retire with a small sum, and use that money once we reach a certain age and, hopefully, we live long enough to see it.

The new model is where we create an equitable and scalable business where we do NOT directly exchange our time for money.

In fact, we can even earn money while we sleep!

You can continue to reinvest into yourself and your business and watch the income increase in direct proportion to the amount of hard work you put into it!

It is NOT normal to work 40 – 80 hours per week!

Yes, there is what I like to refer to as a “hustle season”

Breakdown of What I Charge my Clients?

How many of you have a dentist, a doctor, or know someone that owns a small business?

Chances are high that you do. Those will make GREAT prospects. All you need is 4 people to say YES; if you are going to charge each client $1,000 a month.

In 2017, according to the bureau of labor statistics, the following were the average salaries for Americans based on their age:

  • 16 to 19 years of age: $422 weekly / $21,944 annually
  • 20 to 24 years of age: $525 weekly / $27,300 annually
  • 25 to 34 years of age: $776 weekly / $40,352 annually
  • 35 to 44 years of age: $976 weekly / $50,752 annually
  • 45 to 54 years of age: $975 weekly / $50,700 annually
  • 55 to 64 years of age: $966 weekly / $50,232 annually
  • 65 years and older: $904 weekly / $47,008 annually

That breaks down to just $48,000 year on average for an American. Or $4,000 per month.

A VERY conservative amount for you to charge a client would be $1,000 per month.

But what if you sign on more than 4? Or what if you get good enough that you charge $2,000 per month? Or $5,000 per month, or even $10,000+ per month?

While those numbers may seem like a lot, it’s actually not uncommon.

You could very easily be on your way to earning over $100,000 a year!

Test optimization, incentivize referrals. Give current clients a discount for sending referrals. Offer them a discount of up to $500 off their monthly bill for every client they introduce that signs up for your services.

Who Are My Clients?

In order for you to go out and pick up a client, you need a hotlist of clients that you should be looking for.

Which business is going to be most likely to pay us, and have enough money to easily pay us $1,000 every single month or more to actually run their Facebook ads for them.

We are looking for high demand, cash-rich businesses that a lot of people are interested in.

Some of the businesses I like to target are:

  • Dentists
  • Landscaping
  • Cosmetics
  • Tanning Salons
  • Fitness Centers / Gyms
  • Real Estate Agents
  • Insurance Companies
  • Car Dealerships

These are just a handful of businesses that have no idea how to handle their marketing, yet are making a TON of profit each and every month because they have such high demand.

Something that you have to remember is that these businesses are busy running their day to day business activities. They don’t have an in house marketing team to run their ad campaigns and they don’t understand how to run social media ads themselves but they do understand the power of it.

They are going to outsource this to a marketing specialist that can yield them new paying customers.

This is where we come in to let them know that we’re masters of social media marketing firm that can generate leads and customers for ZERO additional work on their end, which is going to be a HUGE incentive for them.

So I know what you’re thinking, how do I get these businesses to sign up with me when I don’t have much experience?

And that is certainly a valid question.

If you don’t have any experience or you don’t have any idea how to get clients to pay you, you can offer to run their social media ads for FREE for a short period.

This is a great way to gain experience, build a rapport with your clients and prove that you can make their lives easier.

Have these clients pay for the ad spend out of their marketing budget. You don’t charge anything for your time. All you do is offer them up to a week’s worth of free service.

This will be enough time to show them that you can generate new leads, getting potential customers interested in what it is they have to sell.

Taking this route is a great way to turn a seemingly skeptical client into a profitable and paying client.

Where do I find these Clients?

Now that you know what clients you should be going after, it’s time to find them.

There’s a handful of different ways to handle this but honestly, the quickest and most effective way, in my opinion, is to reach out to family, friends, and businesses that you already know.

After you have already talked to your dentist, car insurance firm, family and business, the second-best method is to simply search on Google for these clients.

Let’s say you live in D.C. and you want to search for cross fit gyms in the D.C. metropolitan area.

I would simply go through all the gyms, get all their contact information from their websites, go to the Facebook fan page and send them a message, or call them.

When reaching out to them I would I see whether or not they were running paid social media marketing ads currently, or not.

If they were, I would look for areas of improvement and reach out to them letting them know I was a social media marketing agency and that I would love to help them improve their social media advertising.

If they weren’t running any paid Facebook ads, I would again introduce myself, let them know exactly what it is that I do, then offer to run their paid ads for FREE (they just pay for the ad spend) for a few days. Proving to them that I can get them profitable customers that are going to be worth WAY more than the upfront ad cost.

It’s only after I do this that I talk about me taking on a more official role, full time, to run their entire Facebook ad campaign for them.

I got my first Client, now what?

Wow, congrats! You actually took the time and built up enough courage to turn someone into a paying client.

You’re so far ahead of the curve it ain’t even funny!

Now it’s time to get them the results that will get you PAID.

The ultimate question is, how do we ensure we’re actually getting these clients the profitable customers that they need for their businesses?

One of the ways I like to do this is by leveraging human nature.

I want you to think about something for me quickly.

When you go out in the world to buy a cup of coffee or go grocery shopping, do you generally go to the same stores that you’re familiar with? Or do you go to a completely new store each time?

For the majority of us, we’ll go to the same places that we are already accustomed to.

Because humans are creatures of habit.

People will tell you it’s ten times more difficult to acquire a NEW client than selling something else to an existing client. The reason is that people are habitual.

Breaking out of your habits from your favorite coffee spot, to where you buy your groceries from is hard.

So how do we break someone’s habits and get them to try something new?

We need to create some form of value that will incentivize a customer to give something new a try.

Taking the gym example from above, imagine we are running ads for a local gym.

We need to generate results relatively quickly.

In our Facebook ad campaign, we can offer a 14-day free gym membership trial for anyone that fills out a brief online survey.

This survey can be a simple form, asking customers basic questions about their opinions on gym memberships.

After they have completed the survey, they get a limited-time trial membership at the gym. Maybe we can extend the offer to a friend, DOUBLING the chances of getting your client a new paying customer.

Now, if you’re thinking ahead the survey that you have asked people to fill out can be used to create better social media marketing campaigns because you’re learning what people that are interested in gym memberships have to say.

Armed with this powerful knowledge you can create better-targeted ads, receive more engagement on these ads, and ultimately generate more leads for your clients.

This model works across numerous industries. If it’s a dentist you can offer free teeth cleaning service. If it’s a car insurance company, maybe it’s a free audit to ensure they are getting the best rates possible.

You can literally make this work for any business in the world.

The best part about it is that people respond positively to FREE offers, something about the word FREE that triggers an emotion in us to take action.

I mean who doesn’t love free samples at the mall or free trials for a new subscription service.

People will sign up and give you their emails and their phone numbers. All you have to do is give those email addresses and phone numbers to your clients and have their sales team close the deals.

If you’re feeling ambitious you can even upsell your services to include handling the closing of leads or potentially conduct their email marketing campaigns as well.

Once your free trial is complete, and you’ve generated leads as promised. It’s now time to discuss with your client how you will come on to be their full-time social media marketing agency.

The better you become and the more confidence you gain, the higher your monthly retainers will be for your clients to keep you onboard to run their marketing.

Be relentless

Now that you have the basics down, it’s time to talk numbers.

Not just the numbers that you’ll be getting paid, but also the number of businesses you’ll need to reach out to in order to get these paying clients on board.

You’ll need to reach out to 5-10 businesses every single day and get their decision maker/business owners on the phone.

You may need to set up a meeting time to talk to these people as just like you, they’re busy too.

Once you get them on the phone you want to make sure that you’re leading the meeting. You don’t want them to interview you as an advertiser.

You want to sell to them the value that you can be providing, rather than having them ask a million and one questions.

The most important things that you want to find out from the decision-maker are:

  1. Where are they getting their current customers from
  2. How much are they spending to acquire new customers
  3. You want to figure out their return on ad spend (ROAS)

The last question is by far the most important question. In fact, you’ll often hear the client ask, “What does that mean?

It’s not uncommon for businesses to not know exactly what the results are that they’ve gotten back on their advertising budget.

You have to remember, a lot of companies are used to the old model of advertising. The billboard method of advertising. Where they pretty much just throw up a bunch of advertisements and hope to turn a profit.

This is a HUGE advantage to you as a marketer. Gone are the days where you post and pray. With platforms like Facebook you can see exactly how much money was earned on any given campaign.


I hope this post has lead to some enlightenment regarding how to start a social media marketing agency. We have covered a lot of ground and you may want to bookmark this page to refer to in the future.

If you are interested in similar content, be sure to browse through our blog for more social media marketing guides, as you begin running your own social media marketing agency.

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