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Securing the Best Price for Your Advertising Agency

Securing the Best Price for Your Advertising Agency

The advertising industry is positioned for extreme growth, making it the perfect time to sell.

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The United States is currently the largest advertising market in the world. Vast changes in technology and social media has significantly influenced consumers as the advertising industry continues to grow nationwide. Advertising has changed over the years now that the internet is the new face of media consumption. The Internet is the fastest growing medium for advertising and it continues to increase an average of 15% annual growth for 2013 to 2015 according to a recent international survey. The Internet has presented new and effective ways of doing business, and it seems to positively affect many industries related to digital media. 92% of marketers said the social media was important to their business according to Social Examiner. The internet and social media has transcended advertising and is rapidly thriving.

If you’re not completely ready to sell your business, it is still necessary for the planning steps to know what your business is worth and where you stand financially. The first step in the process of selling your business is getting a valuation. As a business owner, knowing your businesses market value is important when you sell. A professional and confidential valuation will show your business range of value. At Viking Mergers & Acquisitions, we’ve developed a proprietary approach to a business valuation. While only a professional intermediary can determine the true value of your business, we have provided this formula as a guide below.

  • 50% of annual revenues plus inventory.

Now that you have an idea of how advertising agencies are valued, you can begin making changes within your own agency to increase the value. In addition to increasing revenues and inventory, business owners can also pay attention to these three tips to raise the value of their advertising agency and ultimately secure a higher sales price.

Social Media

Social Media is becoming the most prominent trend in advertising. Platforms such as Facebook, Twitter, and LinkedIn have all had an impact on the way consumers absorb media, and they continue to grow swiftly. As of 2015, 90% of young adults use social media, compared with 12% in 2005 according to Pew Research Center. Also, 71% of online marketers use visual assets for their social media marketing because the visual content is 40X more likely to be shared on social media than other forms of advertising such as print and radio. These statistics go to show that we are more captivated by visuals as a society, and social media is the best way to advertise. Digital marketing goes hand in hand with the advertising.  Read more about the impact of social media and securing the best price for your digital marketing agency.

Technology

The advertising industry is constantly changing due to new technology and software programs. It is important to get ahead of the trends when preparing to sell your advertising firm. Private social activity has produced quite a bit of growth, including sending multi media directly and selecting to individuals and groups of people rather than sharing publicly. Also, people are beginning to buy from each other as opposed to buying from brands. One of the most vital trends is your marketing team and how they operate. There are many teams who have prospered because they have a positive workflow and a creative mindset. There have also been teams who fail because of lack of experience or dysfunctional collaboration. Make sure that your marketing team consists of creative and communicative individuals that understand the advancement of technology.

Paid Media

The advertising industry is changing and growing. Social Media’s impact has greatly influenced advertisement. Now it is changing even more with paid media. Social Media outlets such as Facebook, Twitter, and Instagram are forcing marketers to pay for visibility and impressions. For example, Twitter has 3 diverse ways of advertising. Anyone can promote a tweets, accounts, and trends. It cost between $0.50 – $4.00 per engagement. Promoting a trend can cost $200,000 per day. Facebook has a system where you can promote your content and choose the maximum amount that you wish to spend. Once you have clicked your budget, you will see the estimated amount of likes you are likely to receive. Some marketers will follow thousands of people for engagement instead of paying a cost to get visibility.

Getting ahead of these trends can help build up your advertising agency. Even if you’re not quite ready to sell, these trends can put you in a great position to sell your business at the best price possible. The first step of the process is getting a no-cost, no-obligation valuation. We offer advice on how you can increase your business value, provide access to comparable stats, and give you insight on our valuation process. Every business owner should know the value of their business. Make that step today and find out how you can increase your business value.

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