What an Advertising Agency Does and How to Choose One

An advertising agency is a company that plans, builds, and places ads for other businesses, then measures whether those ads produce leads and sales. The category is large and still growing. US internet advertising revenue reached $258.6 billion in 2024, up 14.9 percent over the prior year, according to the IAB/PwC Internet Advertising Revenue Report. That scale is exactly why choosing the right partner matters, and it is why the choice looks different when your product is a printed job, a fabricated assembly, or a finished building.

What is an advertising agency?

An advertising agency is a firm you hire to grow demand for your product or service through paid and earned channels. US internet advertising revenue reached $258.6 billion in 2024 (IAB/PwC), which shows how much of modern advertising now runs through measurable digital media rather than one-off placements.

A full-service agency covers the whole arc: research, positioning, creative concepts, production, media planning, campaign management, and reporting. A specialist agency goes deep on one discipline, such as search, paid social, or video. Both models exist because businesses need different things at different stages. A sign company opening a second production facility may want one partner to run everything. A manufacturer with a marketing coordinator already in place may only need outside help with video and paid search.

The common thread is accountability. A good agency does not just make ads. It sets a goal, chooses the channels most likely to hit it, produces the work, and then reports on what happened so you can decide what to fund next.

What does an advertising agency do?

An advertising agency turns a business goal into campaigns that run across the channels where your buyers actually spend time. The 2024 channel mix from IAB/PwC shows where the money goes: search advertising reached $102.9 billion, social $88.8 billion, and digital video $62.1 billion, all growing by double digits. A capable agency helps you decide which of those channels deserve your budget and how much.

Where the money goes

US internet advertising revenue by channel, 2024

Three lines carry most of the $258.6 billion total, and all three grew by double digits. Deciding which of them deserves your budget is the media plan.

Search advertising

$102.9B

Social advertising

$88.8B

Digital video

$62.1B

Day to day, the work usually spans these areas:

• Strategy and research. Audience definition, positioning, competitive review, and a media plan tied to a measurable target.
• Creative and brand. Concepts, copy, design, and production for the ads themselves.
• Media planning and buying. Choosing platforms, negotiating placements, and managing spend so budget goes to what performs.
• Search and digital marketing. Organic and paid search, landing pages, and conversion tracking. A partner that connects these disciplines can align your SEO and digital marketing services with the paid campaigns running alongside them.
• Website and design. The pages that receive ad traffic. Strong website design is often the difference between a click and a quote request.
• Video and content. Video keeps expanding, and agencies increasingly bring video production in house so campaigns ship faster.

The point is not to buy every service. It is to buy the mix that moves your specific number, whether that is quote requests, spec’d-in jobs, or dealer sell-through.

Advertising agency vs. marketing agency vs. digital agency

These labels overlap, so judge the capabilities behind them rather than the name on the door. The reason the terms blurred is simple: advertising now lives where audiences do, and audiences are online. Pew Research Center found that 84 percent of US adults use YouTube and 71 percent use Facebook in its 2025 survey, so a campaign that ignores digital channels ignores most of the market.

Here is a practical way to read the labels. An advertising agency traditionally focused on paid media and creative. A marketing agency tends to cover a wider funnel, including brand, content, email, and lead nurture. A digital agency emphasizes online channels such as search, social, and web. In practice, most modern shops do several of these things, and the strongest ones connect them so a single strategy runs across paid ads, organic search, and the website. When you compare firms, map their services to your goals and ignore the category name.

What to look for if you print, fabricate, or build

Companies that make physical things are usually excellent at the hard part. You can hold a tolerance, hit an install date, match a Pantone across two substrates, and keep a crew safe on an active site. The gap is rarely the work. It is that the people who specify the work have changed how they find it, and most advertising agencies have never sold anything that needed a drawing.

That is what separates a useful partner from an expensive one. Four things to test for:

• They can name your buyer, not just your industry. A sign program is often specified by an architect or a facilities manager and then bought by a general contractor. A fabricated component may be sold through distributors and reps, which means the campaign has to serve the channel and the end user at the same time. An agency that talks only about “consumers” has not done this before.
• They understand a bid, and a long cycle. Construction and industrial purchases get scoped, shortlisted, and bid. The job of the ad is to get you on the shortlist and to survive the months between first contact and purchase order, which means measurement cannot stop at a click.
• They can shoot in your environment. Shop-floor and jobsite footage is the most persuasive asset a builder owns, and it is the hardest to get. A crew that has not worked around PPE rules, a running press, a lift, or a production schedule will burn a day and come back with nothing usable.
• They know where your industry still gathers. Trade shows such as PRINTING United, ISA Sign Expo, and FABTECH still generate real pipeline in these markets. Campaigns built around a show calendar behave differently from campaigns built around a retail calendar.

Two warning signs are worth naming. If the pitch leans on discount offers and consumer funnels, the plan was written for a different kind of business. If the agency wants to lead with how outdated your current approach is, walk. The craft is the asset. Advertising should amplify it, and the deck should read that way.

If you want to see what this looks like in practice, our industrial marketing work for manufacturers and these marketing strategies for printing companies cover the same ground in more detail.

In-house team vs. hiring an advertising agency

The choice between building an in-house team and hiring an agency usually comes down to cost, speed, and the range of skills you need at once. The talent is not cheap. The US Bureau of Labor Statistics reported a median annual wage of $166,790 for marketing managers and $133,660 for advertising and promotions managers as of May 2025, and that is before you add designers, media buyers, analysts, and video producers.

Demand for that talent is steady too. BLS projects employment of advertising, promotions, and marketing managers to grow 6 percent from 2025 to 2035, with about 36,300 openings each year on average. Hiring a full bench takes time, and any single hire only covers one skill. For a 40-person shop, one marketing coordinator is a realistic hire; a media buyer, an editor, and a paid search specialist are not.

An agency spreads a team of specialists across your account, which is why many companies use one even when they have internal marketers. A common pattern in these industries is to keep product knowledge, estimating, and customer relationships in house, and to buy the channels, production, and reporting muscle from outside. The right answer depends on your budget, how fast you need to move, and how many disciplines the plan actually requires.

How much does an advertising agency cost?

Advertising agency pricing has no single sticker price. It tracks the scope of the work, the channels involved, and how much media you plan to buy. Because budgets now skew toward measurable digital channels (search, social, and video together made up the largest share of the $258.6 billion US total in 2024, per IAB/PwC), most agencies price around ongoing management rather than one-time projects.

You will usually see one of a few models:

• Monthly retainer. A fixed fee for an agreed scope of work each month. Common for ongoing campaign management.
• Project fee. A set price for a defined deliverable, such as a launch campaign or a batch of video assets.
• Performance or commission. A percentage of media spend or a fee tied to results. Often paired with a base retainer.
• Hourly. Less common for full campaigns, more typical for consulting or small tasks.

Media spend is separate from agency fees, so a budget has two parts: what you pay the platforms, and what you pay the agency to run it well. Ask which one a quoted number refers to before you compare two proposals. We price to scope rather than publishing packages, because the right investment depends on your goals, channels, and timeline. The most useful next step is a short conversation to size the work, which you can start on the contact page. If you want the numbers first, our guide to marketing agency cost breaks down what shops in these industries actually pay.

How to choose the right advertising agency

Choose an advertising agency the way you would choose a fabricator or a subcontractor: on proof, fit, and clear reporting. Reputation carries real weight here. Nielsen’s 2021 Trust in Advertising study found that 88 percent of respondents trust recommendations from people they know more than any other channel, which is a good reminder to ask for references and talk to current clients before you sign.

Work through a short checklist:

• Goals first. Can the agency tie its plan to a number you care about, such as quote requests or booked jobs, not just impressions?
• Channel fit. Do they have real depth in the channels your buyers use, whether that is search, paid social, or video?
• Measurement. How will they track results, how often will you get reports, and will those reports be plain enough to act on?
• References and work. Ask for examples and outcomes in situations like yours, then verify them. Work for a manufacturer or a sign company counts for more here than work for a restaurant.
• Transparency. Are fees, media spend, and ownership of accounts and assets spelled out in writing?
• Fit and communication. You will work with these people often, so responsiveness and clarity matter as much as the pitch.

A partner that connects strategy, SEO and digital marketing services, web, and video under one plan can move faster than a stack of disconnected vendors. When you are ready to compare options, start with a discovery call and bring your goals, budget range, and timeline to the table.

Frequently Asked Questions

What is the difference between an advertising agency and a marketing agency?

An advertising agency traditionally centers on paid media and creative, while a marketing agency usually covers a wider funnel that includes brand, content, email, and lead nurture. The lines blur in practice, so compare the actual services each firm offers against your goals rather than relying on the label.

How long does it take to see results from an advertising agency?

It depends on the channel. Paid search and paid social can generate measurable traffic within days, while organic search, brand building, and content compound over months. In markets where the purchase is bid or specified, judge early progress on shortlist activity and quote requests rather than immediate revenue.

Do manufacturers and sign companies need an advertising agency?

Not always, but many benefit. Hiring the full bench in house is expensive, with BLS putting the median marketing manager wage at $166,790 in May 2025, and a shop that runs presses or a fabrication floor rarely wants a second payroll of media buyers and video producers. An agency spreads specialists across the account instead.

What should a manufacturer or contractor ask an advertising agency before hiring?

Ask how they will tie the plan to a business goal, whether they have filmed on a shop floor or a jobsite before, how they will reach a specifier or a distributor rather than a consumer, how and how often they report, and who owns the accounts and creative. Clear answers on fees, media spend, and measurement are strong signals of a partner worth hiring.