What does a digital agency cost?

Finding the right digital solution for your business can be a complex task, and the pricing of a digital agency can often seem unclear. Many business owners and marketing managers face the question: “How much does it really cost to hire a digital agency, and what do you get for your money?”

In a world where digitalisation has become an unavoidable part of both private and business life, it is crucial to understand the pricing behind digital agencies. From web development, digital marketing, and SEO to social media and app development – the digital solutions an agency can provide are vast.

In this article, we delve into the pricing of digital agencies in Denmark, and what factors come into play when you choose to collaborate with an agency.

What is a digital agency?

Before we take a closer look at the prices of digital agencies, it is important to understand what a digital agency does. A digital agency offers professional services in digital communication, design, development, and marketing. They often work with digital platforms and technologies such as websites, online shops, apps, and marketing platforms to help businesses enhance their digital presence.

A digital agency can typically offer a range of services:

Web development and design: Designing websites, webshops, and applications, as well as developing technical solutions.
SEO (Search Engine Optimisation): Optimising websites to rank higher in search engines like Google.
PPC campaigns (Pay-Per-Click): Digital advertising, e.g., Google Ads or Facebook advertising.
Social media: Building strategies and advertising on platforms such as Facebook, Instagram, LinkedIn, and Twitter.
Email marketing: Setting up newsletters and automating email campaigns.
Branding and visual identity: Developing a visual brand that reflects the company’s values and goals.
Agencies may have different specialisations and experiences, which influence pricing. For example, an agency that specialises in app development will have a completely different pricing structure than one that only offers SEO or PPC campaigns.

Pricing: How is the price determined?

The price for digital solutions can vary significantly depending on a range of factors. Generally, we can categorize pricing into three main categories:

• Hourly pricing
• Project-based pricing
• Monthly subscriptions and ongoing services

Hourly pricing
Project-based pricing
Monthly subscriptions and ongoing services
1. Hourly pricing
One of the most common ways to price digital services is hourly. Most agencies offer an hourly rate, which can vary depending on the agency’s size, experience, and the complexity of the tasks they handle.

According to Bureau.dk, a collection of digital agencies in Denmark, hourly rates average between 500 DKK and 2,000 DKK per hour. Here is an overview of typical hourly rates based on the agency’s size and experience:

Freelancers or small agencies: 500 DKK to 800 DKK per hour.
Medium-sized agencies: 800 DKK to 1,500 DKK per hour.
Large agencies: 1,500 DKK to 2,000 DKK per hour.
For small and medium-sized businesses, freelancers and smaller agencies can be a good solution, as they can offer a more economical hourly rate. However, larger agencies may have the expertise and resources to ensure that larger, more complex projects are handled effectively.

The advantage of hourly pricing is that it provides both the agency and the client with flexibility. If the project changes along the way, both the scope and time spent can be adjusted. The downside is that it can be difficult to predict the final price, especially if the project drags on, or if it is hard to define exactly what needs to be delivered.

2. Project-based pricing
Project-based pricing is another common method used by digital agencies. Here, the agency sets a price for the entire project based on the time and resources it will require to complete it. This model gives the client a more predictable price, and the agency must ensure that the project can be completed at the agreed price.

Project-based prices can vary significantly depending on the complexity of the project. For example:

A simple website can cost between 20,000 DKK and 50,000 DKK.
A complex webshop can cost between 50,000 DKK and 150,000 DKK.
A custom app can cost between 100,000 DKK and 500,000 DKK, depending on functionality and design.
According to Tandem, a digital agency in Copenhagen, their project prices start at 100,000 DKK for a simple website, while a larger project, such as an e-commerce platform, can cost up to 500,000 DKK or more.

Project-based pricing is ideal for clients who have a clearly defined project and want to know exactly what they can expect to pay. A clear advantage of this model is that the client can set the budget in advance, and the agency then works within those parameters.

3. Monthly subscriptions and ongoing services
For clients who need ongoing support, monthly subscriptions are a popular payment model. Many agencies offer ongoing services such as SEO, social media marketing, or website maintenance on a subscription basis. This gives clients the advantage of being able to predict their costs and receive ongoing assistance without having to pay for each individual project.

Subscription prices can vary depending on the nature of the task. For example:

SEO services: 5,000 DKK to 15,000 DKK per month.
Social media: 10,000 DKK to 30,000 DKK per month.
Ongoing website maintenance: 5,000 DKK to 15,000 DKK per month.
For businesses looking for continuous updates and optimization of their digital platforms, monthly subscriptions can be a practical solution. It allows the agency to provide ongoing strategic advice and technical support.

What do you get for your money?

When considering investing in a digital agency, it is important to understand what you are getting for your money. Most agencies specialise in specific areas, so it is crucial to choose an agency that matches your needs.

Expertise: Digital agencies have a team of experts who can assist with everything from design and development to strategy and marketing. Their experience can make a significant difference in the quality of the solutions you receive.

Creativity and innovation: Agencies often work with a variety of clients and industries, which allows them to bring new, innovative solutions to the table. This can be a major advantage when you want something that stands out in the market.

Scalability: If your business is growing, the agency can help you scale your digital solutions quickly and efficiently, which can be challenging to do in-house.

Time-saving: Working with an agency saves you time, as they can handle the technical and creative tasks, allowing you to focus on your core business.

Long-term partnership: An agency can be a long-term partner that helps develop and optimise your digital solutions as your business grows.

Examples of digital agencies in Denmark and their prices

Tandem: A digital agency that specializes in tailored solutions. Their prices start at 100,000 DKK for a simple website and can rise to 500,000 DKK for more complex projects.

Bureau.dk: A platform that brings together Danish digital agencies. According to the agency, hourly rates for smaller agencies can be as low as 500 DKK per hour, while larger agencies can charge up to 2,000 DKK per hour.

Webamp: An agency that specializes in web development and digital solutions. Prices for their projects start at around 25,000 DKK for a simple website.

Conclusion

Choosing a digital agency can be a significant investment for your business, and the price depends on various factors such as the complexity of the project, the size of the agency, and the type of service you require. Hourly pricing is common, but project-based solutions and monthly subscriptions are also becoming more popular.

Regardless of which model you choose, it is important to have a clear understanding of the costs and to ensure that the agency can deliver the quality and service you need. Selecting the right agency can be a wise investment that helps your business achieve success in the digital arena.