How to Choose a Digital Marketing Agency

If you found me by typing in “how to choose a digital marketing agency” into Google, let me first say to you: good instinct.

Marketing agencies cost a lot of money and you don’t want to pick the wrong one. It’s not always easy to know who’s good at the job and who’s good at looking good at the job. And I’m saying this as a marketing professional who sometimes needs to hire other marketing professionals.

You don’t want to burn your ad budget. You don’t want to spend months trying things that have no viable path to success.

So in this post, I’ll walk you through five areas you should consider. These are the criteria I use when choosing other digital marketing agencies to work with on big projects as teammates. Among them are:

Once you’re done reading this, it’s my hope that you’ll feel comfortable choosing the right marketing agency for your next project.

You don’t need perfection in all five areas. But if you see too many red flags and not enough green flags, that’s a sign to keep looking.

Before you make any agency hiring decision, or hiring decision more broadly, you have to start with the super basic question. “Can they do the job?”

When you’re looking for a marketing agency, there are a few ways you can find out the answer.

Check out their portfolio and case studies. Look for work that's similar to your needs—not necessarily your industry, but your type of marketing. If you need lead generation, look at their lead gen work. If you need eCommerce growth, look at eCommerce case studies.

Pay attention to how they describe their role versus what the client contributed. Good case studies show process, not just results. Be skeptical of "we increased revenue 400%" claims without that all-too-necessary extra context about timeline, ad spend, or what was broken before they showed up.

Area expertise beats general competency. So you need ask questions like, “do they specialize in the channels I need?”

SEO agencies shouldn't pitch you on social media if it can’t be tied back to SEO. Paid media specialists shouldn't claim deep content marketing expertise, unless they can tie it back to paid media.

There are a lot of generalist agencies out there, and many are good. But if you run into an agency that says they do everything well, there’s a good chance they nothing exceptionally. Even a “full-stack agency” should have some sense of focus. Because when it really comes down to it, specialists often beat generalists.

Look at their track record and references. Case studies and portfolio work are great, but there’s always the risk that the agency is misrepresenting the work. So ask to speak with current clients—not just cherry-picked success stories from three years ago. Ask open-ended questions and see what comes out of the conversation.

Look for agencies that have been around three or more years. The barrier to entry for new digital marketing agencies is very low, which means they’re very easy to start. This can attract less-experienced business owners, so you need a way to account for that. Agencies that have survived for three or more years have generally figured something out.

Pay attention to baseline professionalism. Do they respond to your inquiry within a business day or two? Is their own website clear and functional? Do they write coherent emails?

These basics predict how they'll handle your account. If they can't run their own marketing competently, they won't run yours well either.

Learn about their technical capabilities. You want to make sure any agency you’re looking to work with has the ability to execute on their core offerings. That is, make sure they don’t outsource everything. It helps to ask technical questions, and see if can they answer it without hand-waving.

Green Flags:

Red Flags:

Competence without understanding is a scary combo. Any agency partner you’re considering needs to indicate an understanding, or willingness to form an understanding, of your industry and your specific business situation.

Pay attention to the quality of their questions. Do they ask about your margins and customer lifetime value? Do they want to understand your sales process and how long it takes to close deals? Are they curious about why customers actually buy from you?

Good agencies ask these questions because tactics don't matter if your offer isn't solid. No amount of traffic fixes a product nobody wants.

Do they ask what you've already tried? What worked and what didn't? If they're pitching solutions before understanding your context, that indicates that they’re not engaging with your business on the level that they need to.

They need a grasp of your objectives. Can they articulate what success looks like for your business? Do they understand the difference between brand awareness, lead generation, and direct sales?

Are they asking about your timeline and constraints? Do they probe what problem you're really trying to solve? This is important because a lot of the times, the problem isn't "we need more traffic"—it's "we need better qualified leads" or "our sales team can't handle more volume yet."

Budget clarity is a big positive here. Good agencies tell you if your budget is too small for your goals. They'll explain what's realistic to accomplish with your spend and help you prioritize.

They're honest about what you can't do, not just what you can. If you have a $5,000 monthly budget and want to dominate five different channels, they should tell you that won't work.

See if they demonstrate strategic thinking. If necessary, a good agency should challenge your assumptions during the discovery call. You want to walk out of the call with the feeling that they spot potential issues in your funnel or offer before you hire them.

The best agencies connect tactics to business outcomes. They think about the whole picture, not just their piece of it.

They seek out industry context. Your agency doesn’t necessarily need deep expertise in your specific industry, but they should understand basic market dynamics. They should research your industry or competition before your first call. They should ask intelligent questions even if they don't know your space intimately.

Green Flags:

Red Flags:

Competence and understanding are the bedrock foundation of any good agency work, but you also need to understand how your potential agency partner works. Because honestly, this is where a lot of otherwise good partnerships sour.

Ask about their approach to strategy. Can they articulate a clear approach for your specific situation? Do they have a testing plan, or is their strategy fixed and unchanging?

Good agencies understand the explore-exploit tradeoff. That’s because sometimes you need to test new channels. Sometimes you need to double down on what's working. They should know when to do each.

Ask about their testing and experimentation. Do they talk about pilots and small-scale tests before going big? Can they explain how they'd check their assumptions to see if they are right?

Marketing is fundamentally about experimentation. Agencies that skip testing and jump straight to "our proven system" either work with really similar clients or are trying to solve every problem with the same solution.

Learn about how they handle measurement and reporting. You need to know how your marketing partner will measure success and which metrics they track. Do they account for attribution issues? Can they explain which metrics actually matter versus which ones are misleading? Good agencies know this and try to measure lift, not just what Meta's reporting dashboard says.

It’s especially important to ask about what happens in months 1-3. You want someone who can walk you through a realistic timeline. You need to know what the setup period before campaigns launch looks like. Ask when you can expect early signals versus actual results, as most channels need time to learn.

It’s also important to ask how they handle what's not working. Do they have a process for stopping underperforming campaigns? How do they decide when to optimize versus when to cut losses?

Ask how often you can expect updates. You want to know how often they report and how. You should have a clear point of contact, and someone who can handle urgent issues.

Good agencies are careful about scope and focus. There are a lot of ways to handle marketing, so your partner should recommend focusing on what’s most likely to work. I can’t emphasize enough how important this is.

Bad agencies want to run every channel because more channels mean more billable hours. Good agencies understand that marketing is really about scope control—saying no to things that don't matter so you can focus on things that do.

Green Flags:

Red Flags:

You might work with this agency for a year or more. The relationship needs to function on a personal level as well as a professional one.

Pay attention to communication style. Do they communicate clearly? Are they responsive during the sales process? (If they're slow now, they'll be slower after you sign.)

Consider also their ability to explain the complicated. Can they explain complex things simply? Do they listen, or just talk at you?

Assess their transparency. You want an agency that is honest about risks and limitations. That means the people you deal with need to admit when they don’t know something.

It is very hard to know, without testing, if an offer is going to resonate with a particular audience. It’s difficult to know if a particular tactic will work. Agencies should be forthright about this.

Consider cultural fit. Do they match your company's style? Some businesses want formal partnerships. Others want casual, fast-moving collaborators.

Any agency you hire needs to feel like a partner and not just another vendor. Your team should truly want to work with them.

You need to like the people you'll work with. This is huge. Who's your day-to-day contact? Will you work with the person who pitched you, or will you get handed off to someone junior?

Beware “yes men.” You need partners who will push back when appropriate, and who won’t just agree with every idea. Unthinking agreement is order-taking, not high-value strategic work.

They need to be realistic about timelines. Good agencies avoid overpromising and are careful to set honest expectations. They’ll explain where things could go wrong.

I'd rather work with an agency that underpromises and overdelivers than one that makes big claims they can't back up.

Green Flags:

Red Flags:

Once you get to this stage, it’s all about dotting I’s and crossing T’s—but that doesn’t mean this is a mere formality. Good business terms are required for good long-term business relationships.

Look at the contract structure. Month-to-month or quarterly contracts are reasonable for most small and mid-sized businesses. If they're asking for 12 months upfront, there should be clear milestones and exit clauses.

Avoid contracts with auto-renewal traps. You should be able to leave with reasonable notice—usually 30 to 60 days.

Make sure the pricing model works for you. Flat retainers should have clear scope. Percentage of ad spend (typically 10-20%) can work, but watch for minimum spends that don't make sense for your budget.

Performance-based pricing sounds good but is complicated. Scrutinize those terms carefully.

Look at what is included and what’s not. Is ad spend separate from management fees? (The answer is usually yes, but you don’t want any ambiguity about this.)

You also need to know which deliverables are included each month. Consider what costs extra and whether there are setup fees.

Get all of this information in writing. "We'll figure it out as we go" is not a good basis for an agency-client relationship.

Assess pricing for reasonableness. As a rough guide:

Price should match scope and expertise. If something seems too cheap, you're probably getting what you pay for.

Ask about account ownership. You should own your ad accounts, pixels, and tracking. You should have full access to all platforms. Ask what happens to these assets if you leave.

This isn't negotiable. If they want to own your accounts, that’s a non-starter.

Know your exit terms. Figure out how much notice you have to give before cancellation. Are their penalties? And if you cancel, what’s the transition process? Reasonable agencies make it easy to leave within a short time frame if things aren't working.

Green Flags:

Red Flags:

Choosing an agency isn't about finding the "best" one. It's about finding the right fit for your business, budget, and goals.

You need competence, understanding, a solid process, good relationship fit, and reasonable terms. If an agency passes most criteria in four or five areas, then they’re probably worth a shot. It’s when you find red flags in two or more areas that you should probably keep looking.

When in doubt, trust your gut. There are a lot of vendors out there, and if the discovery process doesn’t give you confidence, it’s OK to keep looking.

The best agencies act like partners, not vendors. They'll challenge you, test assumptions, and be honest even when it's uncomfortable.

And that kind of honesty? That’s worth a whole lot more than a pretty pitch deck.