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Paid social agencies: what they do, how they charge, and the checks to make before you sign

The six jobs, the three fee models and the account ownership test.

Published by AI Knows Us · Updated 13 October 2026

A paid social agency buys and manages advertising on social platforms for you: Meta (Facebook and Instagram), TikTok, LinkedIn, YouTube, Snapchat, Pinterest and X. It builds the audiences, makes or briefs the creative, sets budgets, watches the numbers daily and reports. The right one for you depends on three things: which platform your buyers actually use, whether you need the agency to make the ads or only to run them, and how it charges. This page explains what the work contains, the three fee models, and the checks that separate an agency worth hiring from one that only resells your own ad spend.

What the work contains

Paid social is more than pressing "boost post". A competent agency does six jobs.

  1. Account and tracking setup. Ad accounts, business managers, the pixel or conversions API, and the events that count: a purchase, a form, a call. Without correct tracking every later number is guesswork.
  2. Audience building. Interest and demographic targeting, custom audiences from your customer list or site visitors, and lookalikes built from your best buyers.
  3. Creative. Images, short video, carousels and the copy around them. On most platforms the creative does more of the targeting work than the audience settings.
  4. Campaign structure and budget. Separating people who have never heard of you from people who visited and left, and giving each a different message and a different budget.
  5. Testing. Changing one thing at a time, such as the hook in the first three seconds, the offer or the landing page, and keeping what wins.
  6. Reporting. Cost per result, not just clicks and impressions, tied to your sales.

Paid social against organic social

Organic social is what you post to followers. Paid social puts a message in front of people who do not follow you, chosen by targeting. If you also need a plan for the posts, the calendar and the community, that is a different brief, covered in our guide to social marketing goals. Many agencies do both. Hire a paid specialist when the goal is measurable demand, such as leads or orders, in the next quarter.

Which platform for which buyer

PlatformStrongest when
Meta (Facebook, Instagram)Consumer products, local services, and broad B2C reach
TikTokYounger audiences and products that look good in short video
LinkedInB2B, where you target by job title, company and industry
YouTubeProducts that need explaining or comparing
PinterestPlanning purchases: home, weddings, food, fashion

An agency that recommends all seven platforms for a small budget has not studied your buyer. Two platforms done well beat five done thinly.

The three ways agencies charge

Percentage of ad spend

The agency takes a share of what you spend on the platforms. It is simple, and it rewards the agency for you spending more, whether or not spending more is right. Ask what the percentage is at each spend band.

Flat monthly retainer

A fixed fee for a defined scope: number of campaigns, number of creative sets, reporting cadence. It is predictable and suits steady work. Check that creative production is inside the fee or priced separately.

Performance fee

A fee tied to leads or sales. It sounds aligned, and it is only fair when the two of you agree in writing how a result is counted and who owns the customer data. Ambiguity here causes most disputes.

Whichever model you choose, ask for the fee in writing and ask separately for the ad spend, which should be paid to the platform from an account you own.

Checks before you sign

  • You own the ad account. The agency gets access. If it insists on running your ads from its own account, you lose your history and audiences when you leave.
  • Ask to see an account. Not a slide, a live or screen shared view of a current client's results with the name hidden, including the cost per result over time.
  • Ask what they will test in month one. A specific answer, such as three hooks and two offers, shows a process. "Optimise" shows none.
  • Check platform partner status. Meta, TikTok and LinkedIn each run partner programmes for agencies. Membership is a check on training and spend history, not a measure of fit, so use it alongside references.
  • Treat guaranteed results as a red flag. An agency promising a fixed cost per lead before it has seen your offer is selling you something else. Nobody controls an auction.
  • Read the reporting sample. It should show cost per result and the link to your revenue, not a page of reach figures.

Our checklist for hiring a marketing agency holds thirty more questions that apply here, and the guide to hiring a digital ad agency goes deeper on account ownership and a sixty day plan.

What you supply

The agency cannot invent an offer. Bring a clear price or promise, a landing page that matches the ad, product photos or footage, and a number: the most you can pay to win one customer. Share that number on day one so campaigns are judged against it.

A first ninety days to ask for

A proposal should lay out the opening quarter in plain stages, so you can hold the agency to it.

  • Weeks 1 and 2. Tracking installed and tested, audiences built, first creative approved. You should be able to see a test purchase or test enquiry arrive in your own reports.
  • Weeks 3 to 6. Launch of two or three ad concepts against one audience each. Spend is kept modest while the platform learns, and the agency reports cost per result by concept.
  • Weeks 7 to 12. Budget moves toward the concepts that win, new variations of the winner go in, and a retargeting layer starts for people who visited and did not buy.

By the end of the quarter you should know your cost per customer on each platform and which creative idea carries it. An agency that cannot name them has been spending, not learning.

Questions about paid social agencies

How much budget do I need before hiring an agency?

Enough that the agency fee is a small share of the media spend. If the fee would be larger than the ad budget, run a simple campaign yourself first and hire when spend grows.

How long before paid social shows results?

Platforms need a learning period after launch while delivery settles. Judge the first month on whether tracking works and tests are running, then judge cost per result from the second month.

Should the agency make my creative?

If you have no designer or video skills, yes. Ask for the number of creative sets per month in the contract.

Who owns the audiences and data?

You do, when the ad account and pixel are in your name. Write it into the contract.

Is paid social better than search ads?

Search ads reach people already looking. Social ads create interest in people who were not. Many businesses use both.

The place your ad cannot reach

Paid social decides who sees your ad. It does not decide what an assistant tells a buyer who asks a plain question such as "which agency should run Instagram ads for a clothing brand". ChatGPT, Gemini and Perplexity answer that from the sources they read, and agencies are named or left out there with no bid involved. AI Knows Us puts the question to those assistants and records which agencies and brands come back, which is worth running on your own category before you pay anyone to advertise in it.

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