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Last updated on October 7th, 2023


Executive Summary

Your executive summary is the first part of your business plan, but you usually write it last because it is a summary of all the important parts.

The point of your Executive Summary is to get the reader’s attention quickly. Tell them what kind of advertising agency you run and what your status is. For example, are you a new business, do you have a small advertising agency that you want to grow, or do you run a chain of advertising agencies?

Next, give an overview of each part of your plan that follows. For example, you could briefly describe the advertising business. Talk about the kind of advertising agency you run. Detail your direct competitors. Tell us about your ideal customers. Give a brief overview of your marketing plan. Find the important people on your team. And explain what your financial plan is.

Company Analysis

In your business analysis, you will explain what kind of advertising agency you run.

For example, you could run one of the following types of advertising agencies:

  1. Full-Service Advertising Agency: This type of ad agency offers a wide range of services to its clients, such as digital, traditional, social media, radio, and print advertising campaigns.
  1. Digital advertising agencies focus on digital marketing and advertising like social media marketing, email marketing, content marketing, web design, and search engine optimization (SEO).
  1. Traditional Advertising Agency: This type of ad agency focuses on traditional marketing and advertising campaigns, such as radio and TV commercials, billboards, magazine and newspaper ads, and so on.

In the Company Analysis section of your business plan, you need to explain what kind of advertising agency you will run and give background information about the business.

Answers should be given to questions like:

  • When did you start your business, and why?
  • What important steps have you taken so far? Milestones could include the number of customers served, the number of positive reviews, the amount of money made from advertising campaigns, and so on.
  • Your legal structure. Are you set up as an S-Corporation? An LLC? A single-person business? Tell us about your legal structure.

Industry Analysis

In your industry analysis, you need to give an overview of the advertising agency business.

Even though this may seem pointless, it has more than one use.

First, learning about the advertising agency business gives you information. It gives you a better idea of the market you are in.

Second, market research can help you make your strategy better, especially if it shows you market trends.

The third reason to do market research is to show your readers that you know a lot about your field. You do just that by doing the research and putting it in your plan.

In the industry analysis section of your advertising agency business plan, you should answer the following questions:

  • How big (in dollars) is the advertising agency business?
  • Is the market going down or up?
  • Who are your main rivals in the market?
  • Who are the main market suppliers?
  • What changes are happening in the field?
  • How fast is the industry expected to grow in the next 5–10 years?
  • How big is the market that matters? That is, how big is your advertising agency’s potential market? You can figure out such a number by figuring out how big the market is in the whole country and then applying that number to the population in your area.

Customer Analysis

In the section of your business plan about your advertising agency called “Customer Analysis,” you should describe the customers you serve or expect to serve.

Start-up companies, large corporations, small businesses, and non-profit organizations are all examples of customer segments.

As you might expect, the type of ad agency you run will depend a lot on the customer segment(s) you choose. Obviously, a well-established business that wants to grow would respond to different marketing campaigns than a small business that is just getting started.

Try to figure out who your ideal customers are based on how they look and how they think. In terms of demographics, talk about the ages, genders, locations, and income levels of the people you want to serve. Most advertising agencies mostly work with people in their own city or town, so it’s easy to find demographic information on government websites.

Psychographic profiles explain what your target customers want and need. The better you can understand and define these needs, the easier it will be to get customers and keep them coming back.

Competitive Analysis

In your competitive analysis, you should list your business’s direct and indirect competitors and then focus on the direct ones.

Other advertising agencies are their main competitors.

Indirect competitors are other places where customers can buy things that aren’t direct competitors. This includes advertising firms, graphic designers, and people who work on their own.

In terms of direct competition, you should talk about the other advertising agencies that you compete with. Most likely, your closest competitors will be people who buy and sell houses.

Give an overview of each of these competitors’ businesses and list their strengths and weaknesses. Unless you’ve worked at one of your competitors’ companies, you won’t know everything about them. But you should be able to find out key facts about them, such as:

  • What kind of clients do they work with?
  • What kinds of advertising do they do best?
  • How much do they charge (high, low, etc.)?
  • What can they do well?
  • What do they do wrong?

For the last two questions, try to answer them from the customers’ point of view. And don’t be afraid to ask the customers of your competitors what they like and dislike about them.

The last part of your competitive analysis section is to list the ways you are better than your competitors. As an example:

  • Will you offer a wider range of ways to advertise?
  • Will you help the team more?
  • Will you price things better?

Think about how you will do better than your competitors and write them down in this part of your plan.

Marketing Plan

Usually, a marketing plan has four parts: the product, the price, the place, and the promotion. For a business plan for an advertising agency, your marketing plan should include:

Product: In the product section, you should repeat the type of advertising agency company that you wrote about in your Company Analysis. Then, give specifics about the products you’ll be selling. For example, do you offer services like public relations and/or social media management in addition to advertising?

Price: Write down the prices you’ll be charging and how they compare to those of your competitors. In your marketing plan, the product and price sections are basically where you list the services you offer and how much they cost.

Place: Place is where your advertising agency is located. Write down where you are and how that will affect your success. For example, is your advertising agency in a busy shopping area, a business district, a freestanding building, etc.? Talk about why your location could be the best for your customers.

Promotions: This is the last part of your advertising agency’s marketing plan. Here, you’ll write down how you’ll get people to your location (s). Here are some ways you could promote your business:

  • Putting ads in newspapers and magazines in your area
  • Contacting local websites
  • Flyers
  • Social media marketing
  • Local radio advertising

Operations Plan

In the other parts of your business plan, you talked about your goals. In your operations plan, you talk about how you will reach those goals. Your plan for operations should have two separate parts.

Everyday short-term processes include all of the tasks you need to do to run your advertising agency business, like marketing your services, getting new clients, and launching new services.

Long-term goals are the goals you want to reach in the future. These could be the dates by which you hope to have finished X number of marketing campaigns or made $X in sales. It could also be when you plan to open a new location for your business.

Management Team

For your advertising agency to show that it can be successful, you need a strong management team. Showcase the backgrounds of your key players, focusing on the skills and experiences that prove they can help a company grow.

Ideally, you and/or other members of your team have managed advertising agencies before. If so, talk about your experience and skills. But also highlight any experience you think will help your business succeed.

If your team is missing something, you might want to put together an advisory board. A two-to-eight-person advisory board would help your business in the same way that a mentor would. They would help answer questions and give advice on how to plan. If you need to, look for advisory board members who have managed advertising campaigns or run their own successful advertising agencies.

Financial Plan

Your 5-year financial plan should include a monthly or quarterly breakdown for the first year, then an annual breakdown after that. Your income statement, balance sheet, and cash flow statement are all part of your financial statements.

A more common name for an income statement is a Profit and Loss statement, or P&L. It shows your income and then takes away your expenses to show if you made a profit.

You need to make assumptions in order to make your income statement. For example, will you get two or five new customers each month? And will sales grow by 2% or 10% every year? As you might expect, the financial forecasts for your business will be greatly affected by the assumptions you choose. Do as much research as you can to try to make sure your assumptions are true.

Balance sheets show both your assets and your debts. Balance sheets can have a lot of information, but try to boil them down to the most important parts. For example, if you spend $50,000 building up your advertising agency, you won’t make money right away. Instead, it is an asset that you can use to make money for years to come. Likewise, if a bank gives you a check for $50,000, you don’t have to pay it back right away. Instead, you will have to pay that back over time.

Cash Flow Statement: Your cash flow statement will help you figure out how much money you need to start or grow your business and make sure you never run out of cash. Most business owners and entrepreneurs don’t realize that you can make money but still go bankrupt if you run out of money.

When making your Income Statement and Balance Sheets, be sure to include some of the most important costs of starting or growing a business like an advertising agency:

  • Location build-out, which includes construction, design fees, etc.
  • Cost of supplies and equipment
  • Payroll or wages given to employees Business insurance
  • Taxes and licenses:
  • Legal expenses