Start a social media marketing business by following these 10 steps:
You have found the perfect business idea, and now you are ready to take the next step. There is more to starting a business than just registering it with the state. We have put together this simple guide to starting your social media marketing business. These steps will ensure that your new business is well planned out, registered properly and legally compliant.
Check out our How to Start a Business page.
STEP 1: Plan your business
A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:
- What are the startup and ongoing costs?
- Who is your target market?
- How much can you charge customers?
- What will you name your business?
Luckily we have done a lot of this research for you.
What are the costs involved in opening a social media marketing business?
Most people can get started with a computer, Wi-Fi, and small advertising budget. If you’re planning on incorporating graphic design skills into your business, you may need additional equipment to maximize your impact. There is no need to rent out a professional space though unless you’re planning on offering full agency services.
What are the ongoing expenses for a social media marketing business?
Owners will have to account for administrative costs (including computer equipment), as well as advertising and travel. They may also want to invest in ongoing education. As consumer preferences change, so too do platform algorithms and configurations.
Who is the target market?
The target market is anyone who wants to advertise themselves or their cause. This could be commercial companies, non-profits, or even private parties. You may end up working for an up-and-coming socialite who becomes the next Kim Kardashian!
How does a social media marketing business make money?
Social media marketers charge for their services in a variety of different ways. They may charge per post, per campaign, per hour or per project. For those who are just getting started, they may even consider charging on a commission-only basis. Start-up and incidental costs in this profession are low, so marketers are typically charging their preferred rate based on the scope of the work.
How much can you charge customers?
A full-time social media specialist will earn an average of $50,000 a year. Owners will want to structure their rates so they can pay for all relevant business expenses (including healthcare, transportation costs, etc.), plus additional compensation for their time. It's not unusual to see people charging between $5 and $10 for a single post, or up to $75 an hour for a full campaign.
How much profit can a social media marketing business make?
Top-paid social media consultants easily make more than $100,000 a year. But the amount you make is highly dependent of the amount your clients make. The more success you bring to them, the more you can demand from both new and existing clients alike.
How can you make your business more profitable?
Social media marketers may want to consider branching out to become full advertising consultants. Or they may choose to start their own social media consulting business on the side where they let other hopeful social media marketers know how to get started.
What will you name your business?
Choosing the right name is important and challenging. If you don’t already have a name in mind, visit our How to Name a Business guide or get help brainstorming a name with our Social Media Marketing Business Name Generator
When registering a business name, we recommend researching your business name by checking:
- Your state's business records
- Federal and state trademark records
- Social media platforms
- Web domain availability.
It's very important to secure your domain name before someone else does.
STEP 2: Form a legal entity
Establishing a legal business entity such as an LLC or corporation protects you from being held personally liable if your social media marketing business is sued.
Form Your LLC
Read our Guide to Form Your Own LLC
Recommended: You will need to elect a registered agent for your LLC. LLC formation packages usually include a free year of registered agent services. You can choose to hire a registered agent or act as your own.
STEP 3: Register for taxes
You will need to register for a variety of state and federal taxes before you can open for business.
In order to register for taxes you will need to apply for an EIN. It's really easy and free!
You can acquire your EIN for free through the IRS website, via fax, or by mail. If you would like to learn more about EINs and how they can benefit your LLC, read our article, What is an EIN?.
Small Business Taxes
Depending on which business structure you choose, you might have different options for how your business will be taxed. For example, some LLCs could benefit from being taxed as an S corporation (S corp).
You can learn more about small business taxes in these guides:
There are specific state taxes that might apply to your business. Learn more about state sales tax and franchise taxes in our state sales tax guides.
STEP 4: Open a business bank account & credit card
Using dedicated business banking and credit accounts is essential for personal asset protection.
When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.
Additionally, learning how to build business credit can help you get credit cards and other financing in your business's name (instead of yours), better interest rates, higher lines of credit, and more.
Open a business bank account
- This separates your personal assets from your company's assets, which is necessary for personal asset protection.
- It also makes accounting and tax filing easier.
Recommended: Read our Best Banks for Small Business review to find the best national bank, credit union, business-loan friendly banks, one with many brick-and-mortar locations, and more.
Open net-30 accounts
When it comes to establishing your business credit, net-30 vendors are considered the way to go. The term "net-30," which is popular among vendors, refers to a business credit arrangement where the company pays the vendor within 30 days of receiving goods or services.
Net-30 credit terms are often used for businesses that need to obtain inventory quickly but do not have the cash on hand.
Besides establishing business relationships with vendors, net-30 credit accounts get reported to the major business credit bureaus (Dun & Bradstreet, Experian Business, and Equifax Business Credit). This is how businesses build business credit so they can qualify for credit cards and other lines of credit.
Recommended: Read our guide on the best net-30 vendors so you can start building business credit now, so you never have to worry about cash flow in the future. Keep in mind that poor cash flow is the #1 reason businesses fail!
Get a business credit card
- This helps you separate personal and business expenses by putting your business' expenses all in one place.
- It also builds your company's credit history, which can be useful to raise money and investment later on.
STEP 5: Set up business accounting
Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.
STEP 6: Obtain necessary permits and licenses
Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.
State & Local Business Licensing Requirements
Certain state permits and licenses may be needed to operate a social media marketing business. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.
Most businesses are required to collect sales tax on the goods or services they provide. To learn more about how sales tax will affect your business, read our article, Sales Tax for Small Businesses.
For information about local licenses and permits:
- Check with your town, city or county clerk’s office
- Get assistance from one of the local associations listed in US Small Business Associations directory of local business resources.
Social media marketing businesses should consider requiring clients to sign a services agreement before starting a new project. This agreement should clarify client expectations and minimize risk of legal disputes by setting out payment terms and conditions, service level expectations, and so on.
STEP 7: Get business insurance
Just as with licenses and permits, your business needs insurance in order to operate safely and lawfully. Business Insurance protects your company’s financial wellbeing in the event of a covered loss.
There are several types of insurance policies created for different types of businesses with different risks. If you’re unsure of the types of risks that your business may face, begin with General Liability Insurance. This is the most common coverage that small businesses need, so it’s a great place to start for your business.
Learn more about General Liability Insurance.
Another notable insurance policy that many businesses need is Workers’ Compensation Insurance. If your business will have employees, it’s a good chance that your state will require you to carry Workers' Compensation Coverage.
STEP 8: Define your brand
Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.
If you aren't feeling confident about designing your small business logo, then check out our Design Guides for Beginners, we'll give you helpful tips and advice for creating the best unique logo for your business.
How to promote & market a social media marketing business
Most companies need social media to thrive, but that doesn’t mean that all companies care about social media. A CEO may recognize that his services need to be advertised on Facebook, but they may have no interest in learning about the platform's features or benefits. Social media marketers will need to be able to work with all types of populations in order to be successful.
Besides social media, marketers can turn to paid Google ads to get the word out about their services faster. Quality content is always going to be the best type of marketing, but it can also take months or years to develop (and most startups don’t have the luxury of time.) And like all every other kind of business, owners should be prepared to network whenever they can. This includes scheduled events but also cold-visiting companies in your area to drop off business cards or set up meetings.
How to keep customers coming back
Meeting deadlines, creating creative campaigns, and maintaining a professional attitude are all excellent ways to keep customers coming back. However, the best way to inspire return clients is to increase their ROI based on your social media strategy.
Another good way to keep your customers is to build trust; to do that, you can get your Instagram account verified. What this means is that you are proving to your customers that you are the original owner of your Instagram business account, which will help build trust and notability. Check out our How to Get Verified on Instagram guide to learn more.
In conclusion, to retain your customers, stay relevant and be trustworthy! Know where your market is going before it gets there. Use relevant hashtags. Find out what your customers have to say and prove to them you are a reputable business.
Still unsure about what kind of business you want to start? Check out the latest Small Business Trends to help inspire you.
STEP 9: Create your business website
After defining your brand and creating your logo the next step is to create a website for your business.
While creating a website is an essential step, some may fear that it’s out of their reach because they don’t have any website-building experience. While this may have been a reasonable fear back in 2015, web technology has seen huge advancements in the past few years that makes the lives of small business owners much simpler.
Here are the main reasons why you shouldn’t delay building your website:
- All legitimate businesses have websites - full stop. The size or industry of your business does not matter when it comes to getting your business online.
- Social media accounts like Facebook pages or LinkedIn business profiles are not a replacement for a business website that you own.
- Website builder tools like the GoDaddy Website Builder have made creating a basic website extremely simple. You don’t need to hire a web developer or designer to create a website that you can be proud of.
Using our website building guides, the process will be simple and painless and shouldn’t take you any longer than 2-3 hours to complete.
STEP 10: Set up your business phone system
Getting a phone set up for your business is one of the best ways to help keep your personal life and business life separate and private. That’s not the only benefit; it also helps you make your business more automated, gives your business legitimacy, and makes it easier for potential customers to find and contact you.
There are many services available to entrepreneurs who want to set up a business phone system. We’ve reviewed the top companies and rated them based on price, features, and ease of use. Check out our review of the Best Business Phone Systems 2021 to find the best phone service for your small business.
Recommended Business Phone Service: Nextiva
Nextiva is our top choice for small business phone numbers because of all the features it offers for small businesses and it's fair pricing.
Start A Social Media Marketing Business In Your State
Select your state below for an in-depth guide on completing each of these steps in your home state.
Is this Business Right For You?
People who love social media and marketing will thrive in this business. However, this love must extend beyond just checking Twitter and Facebook every 15 minutes. If you want to start your own social media marketing business, you should know how people interact with different platforms, where your target demographic is most likely to live, and what type of content will spark the most interest. You should also know how (and why) different platforms evolve over time.
Want to know if you are cut out to be an entrepreneur?
Take our Entrepreneurship Quiz to find out!
What happens during a typical day at a social media marketing business?
This type of niche marketing demands a lot of content. Owners will spend a lot of time brainstorming, drafting, and creating campaigns that will drive a brand’s message home to their audience. The other part of social media involves learning more about the background and reputation of your clients.
What are some skills and experiences that will help you build a successful social media marketing business?
Those who have a lot of experience studying social media will do well in this business. A marketing degree may help, but it doesn’t guarantee success. What companies are really looking for is someone with proven success when it comes to engaging their audience.
Most people love social media, but very few understand the nuances behind it. They may puzzle over why one campaign succeeded on Twitter but failed miserably on Instagram. Marketers must have an innate sense of how audiences are interacting with individual posts in order to determine their marketing strategy on a larger scale.
What is the growth potential for a social media marketing business?
The forecast is excellent for social media marketing, especially considering its popularity is only proliferating. While individual platforms may rise and fall, the base audience of social media users is only skyrocketing worldwide. This mass adoption means huge opportunities for those who can find ways to connect with an ever-jaded population. People want less advertising and more substance, and they're looking toward social media to get it.
Not sure if a social media marketing business is right for you? Try our free Business Idea Generator and find your perfect idea.
TRUiC's YouTube Channel
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Take the Next Step
Find a business mentor
One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.
Having a support network in place to turn to during tough times is a major factor of success for new business owners.
Learn from other business owners
Want to learn more about starting a business from entrepreneurs themselves? Visit Startup Savant’s startup founder series to gain entrepreneurial insights, lessons, and advice from founders themselves.
Resources to Help Women in Business
There are many resources out there specifically for women entrepreneurs. We’ve gathered necessary and useful information to help you succeed both professionally and personally:
If you’re a woman looking for some guidance in entrepreneurship, check out this great new series Women in Business created by the women of our partner Startup Savant.
What are some insider tips for jump starting a social media marketing business?
The best way to start your social media business is by creating a killer social media campaign for yourself! Decide who you want to target and then start using different platforms to get more eyes on your website. Optimize and promote your posts to further generate more publicity, and make sure you have a solid mobile presence so people can find you via tablet or smartphone.
Make up your own companies and campaigns to use as samples for your portfolio and ensure you showcase your ability to use different voices to reach out to a variety of demographics within the same niche. After all, a retiree buying a home is going to have a wildly different outlook than a millennial buying a home.
How and when to build a team
There is no need to build a team at first, especially if you only have one or two clients to start. Once you have more clients than you can handle, look for an assistant who can support your campaigns with new ideas and content without changing the tone or the brand message.