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Why is marketing so expensive?

This kinda feels like a copycat article. After all, if you Google “why is marketing so expensive”, you’ll get hundreds of millions of results. However, most of those results will soften the message, blaming it on Facebook algorithms or other such nonsense. This isn’t one of those articles.

Put simply, marketing is expensive no matter how you look at it. You’re either paying for expertise, which takes a long time to cultivate; or you’re paying for mistakes due to lack of experience, which cost very little at first but those mistakes add up over time with little to no results to show for them.

If you choose to opt for the former in the form of a marketing agency, this article will explain many of the reasons why it costs so much and I promise, it looks nothing like Mad Men or Silicon Valley.

Expense #1: All Things Strategy

Creating a custom marketing strategy can take a lot of time and effort. Just the research itself is a boatload of work that a lot of clients don’t see. We look at things like commuter traffic patterns, household income by zip codes, alignment of media audience to our target market segments – even the employee radius of top major employers before we even write the first question of a survey. Then, we look into comparative analysis with the competition, doing much of the same amount of research on them as well.

Once we’ve completed our research, received the survey submissions, wrapped up our social listening period, and so on, it’s time to figure out how to solve the challenge that we’ve been tasked with. That document is the result of a lot of analysis and creativity, and no agency worth their salt is working from a previous strategy or a template. And that’s before many of the services even begin.

Expense #2: Staff – and I mean good staff.

If you were to hire an internal resource for marketing, I suspect you’ll pay at least $45,000/year for someone that remotely knows their stuff. Take into account taxes, benefits, and so on and the number is actually considerably higher. When a marketing agency charges $8,000 per month, you’re getting a vetted staff of professionals – not just one or two. You get the collective experience and effort of everyone on the team. An agency structure puts all of those experts at your disposal because they can spread payroll over a few clients, which is why the agency model still makes sense in the digital age.

You also don’t have to onboard and train them; they’re all ready to go!

Expense #3: Yes, ad budgets.

Organic growth is becoming less and less free. Social media posts average less than 3% visibility from existing followers. Google’s first page is crowded with structured data snippets, leaving less room for traditional organic listings. The shift to paying for advertising is less of an option nowadays and, yes, PPC can be pricey. That ad budget is something brands need to take into account on top of agency fees.

I’ve shown in past webinars that we do know how to improve your organic results. The strategies are constantly changing, so you do need the expertise to compete – yet another reason to pay for marketing.


Finally, look at marketing as an investment. A marketing agency – just like an accounting or law firm – should more than pay for itself. The return on investment is hardly ever immediate, but it compounds over time.

When you think of investments, they’re usually in real estate or the stock market. The stock market typically averages a 7-10% yield over many years, while real estate runs between 8-12%. As a marketing agency, we’re often held to standards of 100% return in one year. Every big brand will tell you that if you have the right marketing team, don’t skimp on cost because the greater the investment, the greater the return.

Hopefully, this answers the question “why is marketing so expensive?”. When you consider your marketing agency to be an investment in your organization’s growth, it’s often one of the smartest you can make. It’s not an expense.

Patrick King

Patrick is the Founder of Imagine and advisor to places on brand strategy and creative. His insights have been published in Inc. Magazine, SmartCEO, Washington Business Journal, The Washington Post, and Chief Marketer, among other publications, and shared at conferences throughout the US. He also has an amazing sock collection.

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