TL;DR

• Last year, we built Delphi - an insights network for agency leaders. Now hundreds of them get quarterly updates that keep them informed about key industry shifts. We're expanding this network and opening a dedicated sponsor slot for 2027. We've already had multiple firms reach out, so we'll be selecting the sponsor in the next few weeks. Reply if you'd like to explore sponsoring the Delphi network.
• ​We analyzed over 1k job postings from a few hundred digital agencies and built average salary bands for multiple roles and experience levels.​
• Since compensation is easily the largest expense at agencies, a small miss can quickly weigh on margins. A big miss can wipe them out.
• Most salary and pay aggregators don't let you filter by company type, so the "salary band" they show includes devs from agencies, SaaS startups, large tech firms, small manufacturers, etc.
• Sometimes paying more can be part of your strategy, but this absolutely MUST be intentional. Check to ensure your agency's business model decisions align first.​

Expensive Mistakes

For professional service firms like digital agencies, talent is easily the largest expense.

It’s also the most subjective, and getting it wrong can be costly.

Even a modest error in what you expect your team to cost can materially change what remains for the business.

Consider an agency generating $5 million in revenue, with $2.5 million in annual compensation expense and a 15% net margin. That leaves $750,000 in net income.

If compensation costs come in 5% above plan, that adds $125,000 in expense. With revenue and other expenses unchanged and assuming a 20% effective income tax rate, net income falls by $100,000.

Net margin drops from 15% to 13%.

All from a 5% increase in compensation.

Further Complications

There isn’t a lot of great data out there because aggregators typically don’t segment the roles by company type. You could have a developer at a funded SaaS startup earning significantly more than one would at an agency, but they’ll both be counted as “developers” in the data.

Marketers at your regional accounting firms will be counted in the same salary bucket as marketers at mid-market manufacturers and large tech companies.

Maybe it’s Fine

Maybe the company pays 5% more but gets talent that’s a bit better than average. They can do more, or better, work for clients, and maybe the agency can charge a bit more to offset the above-market rates.

Maybe paying more is part of the agency’s strategy. If it is, I hope their other operational choices are in sync.

My point is that it’s better to approach these things with intent rather than hoping that “maybe it’s fine.”

Data & Inspiration

Intentionally setting your agency’s pay bands requires data.

Many of you have relied on our salary surveys to help understand market rates, but the last one was from 2024. Things have changed since then, and we’re working on updating our survey process for the next one. While that won’t be ready for a bit, we did put together a sort of stopgap in the meantime.

I’ve been subscribed to Emily Kramer’s newsletter MKT1 for a while now. It’s a fantastic newsletter, and I love her approach.

The latest edition was about how she analyzed a bunch of job posts across the B2B marketing space. Well, we know who the 57k digital agencies in the U.S. are; maybe we could do something similar...

It took about a week, but we were able to analyze just over a thousand job postings from a few hundred digital agencies and detail our findings on our Digital Agency Pay Bands page.

I hope this helps give you a better idea of the going rates for various positions specifically at digital agencies.