When you hire an ad agency, you’re not paying for some pretty pictures or a clever tagline. You’re buying brains. Strategic thinking. Problem solving. Writing that doesn’t suck. Design that actually communicates. And most importantly, ideas that move the needle, not just fill a slide deck.
So no, they can’t “whip something up real quick” for free. But hey, there is a smart way to vet an agency without burning your whole budget on a single roll of the dice.
Try this: Open Google. Type in something like “best ad agency San Francisco.” Or go to ChatGPT and ask something more specific, like “what’s a great ad agency for B2B startups in San Francisco?” Division of Labor is gonna come up, with some other great agencies, as well.
So poke around their websites. See what actual work they’ve done, not just who they say they are.
Once you’ve got a shortlist, hop on a quick call and ask for a creds deck. Then (and this is key) hire two or three of them for the same small project. Pay them—because you’re a decent human who knows good work deserves compensation. Then sit back and see who actually brings the goods.
Whoever kills it? Give them the big assignment. You just auditioned your agency like a pro, and you’ll avoid getting stuck in a year-long retainer with someone who peaked during the pitch.
What Should I Budget?
Ah, the golden question. Here’s how agency costs break down, minus the fluff:
1. Media Spend (aka the Actual Ads You’re Paying to Run)
This is where the biggest dollars usually go. Want your campaign on Hulu, Instagram, or some giant LED in Times Square? That’s paid media.
Agencies plan where your ads should go, negotiate rates, track what’s working, and adjust on the fly. They’re like media ninjas—except they invoice you. Most take a cut of the spend (typically 5–18%) as a fee. Worth it if they know their stuff.
2. Production Costs (aka Making the Damn Thing)
This is where the rubber hits the road—or the camera hits record. You’re paying for video shoots, photo editing, coding, animating, asset sizing, TikTok-ing, banner making… basically all the parts that turn a smart idea into a living, breathing campaign.
Agencies quarterback the whole process, managing freelancers, vendors, edits, legal specs—you know, all the soul-crushing logistics you don’t want to deal with. They’ll charge a markup or a flat fee to make the chaos look effortless.
3. Agency Fees (aka Time + Talent + Tums)
This covers everything else: strategy sessions, creative brainstorming, copywriting, design, campaign making, analytics deep dives, social posting, content calendars, panic calls, last-minute pivots, and the occasional therapy-adjacent Zoom meeting.
You pay for hours or a project rate. Or if you like commitment, go the retainer route. Either way, you’re buying peace of mind and hopefully, some business growth.
Still With Us? You Might Be One of the Smart Ones.
If this breakdown didn’t make you choke on your oat milk latte, maybe we’re your people. At Division of Labor, we’re a San Francisco–based ad agency that’s been named Ad Age’s Small Agency of the Year. Twice. Because yes, awards still matter but only the award results.
We work with startups, bigger brands that still think like startups, B2B brands, B2C brands and oh yea, plenty of tech brands. Click here for a free consult. We promise not to waste your time—or your money.
