ROI of Working with a Digital Agency
Published on August 24, 2021

Your team determines it needs a digital product, like a customer-facing app or a custom CMS/CRM tool. Or maybe you already have several digital products and want to consolidate the management of them, such as getting your Salesforce data to sync with your app.
Whatâs the first step youâd take to get that product built?
If you are like most organizations, youâll turn to your HR department who either hires the talent directly or works with a recruiter to help them âput butts in seats.â
Often, companies donât know of another option. If youâve never worked with a digital agency before, itâs not likely to be the first or second thing to come to mind. (Side note: thatâs why we have our marketing work cut out for us)
There are many reasons why it makes sense to work with a digital agency over hiring an in-house team, and weâve talked about those benefits in previous blog posts, but this post is about one clear, tangible benefit.
If weâre being honest, itâs the benefit everyone cares the most about:
Cost savings.
Youâll find plenty of articles that break down the general costs of working with agencies versus hiring your own full-time team. But we donât want to put similarly vague numbers out there. We want to be transparent and visually show you the value of working with our team, using numbers pulled from actual client projects of various sizes.
When will I see a return on my investment by working with a digital agency instead of hiring a team?
First, some data. Depending on your location, hiring just one software developer in the US can cost between $137K and $173K per year for salary and benefits. For the sake of calculating ROI, we used $150,000 since itâs a nice, round, middle-ground number.
Since most projects need both an iOS and Android developer, we doubled that $150,000, so to hire both, youâre looking at around $300,000 a year.
To compare that spend of $300,000 per year, or $25,000 monthly, to the cost of working with a digital agency, we looked at the development costs of two of our recent projects.
Client A: A funded startup building an app-based business
This project needed advanced iOS and Android apps in order to launch the business. It also needed an admin web dashboard (which requires a front-end web developer) and server development (which requires a server developer). Taking these four positions into account, we compared the cost of hiring this team internally versus the actual costs of working with our agency.
Hereâs the visual.
As the green bars show, the cost savings of working with a digital agency were immediate. For the number nerds out there, hereâs the exact data we used to make this visual.
Notice the Cost Savings once outside the Development Phase? This is where the financial impact of working with a digital agency really pays off. Once a product is in maintenance mode, you can reduce your contracted hours and put that budget towards marketing or sales.
Another value of working with an agency like the Jed Mahonis Group is that our team isnât composed solely of developers. You get our entire team which includes other roles vital to the success of a software project such as QA staff and project managers.
Client B: A large organization with an existing technical team
Now letâs say youâre an enterprise-level company that needs full-time attention on an innovative mobile development project. When can you expect to see ROI?
This particular client brought their team to the table, which included server and web developers, a project manager, and QA testers. However, their team had one big hole: they had no one with mobile expertise.
They couldâve hired iOS and Android developers directly, which wouldâve saved them money initially.
Since the project needed the weight of multiple full-time developers, they chose to partner with a tech agency and save money on the long haul.
Letâs take a look:
This is often the type of client that overlooks digital agencies and approaches the problem with a mindset like this: âIf we need something done, weâll hire someone to do it.â
This is also the type of client that benefits heavily in the long run from working with an augmented staff, or what we like to call a scalable development team, because mobile development isnât always a full-time gig.
After the development phase, which generally lasts about 6 months, contracted time with an agency starts to go down as the app moves into support mode. But with a full-time staff, you donât have that flexibility.
After 15 months, our client saw their ROI by working with an agency. Two years in, weâre still working with this client on their apps while they reap the financial benefit of not having to support a full-time inhouse team.
How does this work for JMG?
It should be obvious now why you would win: in the long-term, most apps donât need full-time attention. You save money by just bringing us in when you need a heavy effort applied to the problem, and once the big lift is complete, we only apply a handful of hours each month to keep the lights on.
We win because we are able to work on more than one project at a time. Weâve collected a talented group of developers, designers, project managers, and QA peeps, so youâre essentially sharing this pool of resources with other companies.
This doesnât mean weâre any less focused on your project, but it allows us to be a more affordable option than hiring talent directly.
Youâve heard the ârising tide lifts all boatsâ aphorism. We form long-term partnerships with our clients because when they do well, we do well. This means we also make money even after development ends with a small, ongoing maintenance fee. We take care of all the âunder the hoodâ issues that keep apps performing at their highest level.
Takeaways
While this postâs focus is on cost savings, a very tangible benefit, the biggest value proposition of working with an agency is one that isnât easily quantified: Having someone in your corner who will say âno.â
An employee may not have the courage to tell you why you shouldnât implement a particular feature or choose one tech platform over another. Since companies often come to agencies with a failed project, weâve seen it all and fixed it all.
This leads to our other key advantage: our experience in mobile. If you hire someone full time to just work on your project, they will definitely obtain more domain knowledge in your area of business than we could. However, our team works on all kinds of iOS and Android apps. We have explored every corner of what an app can do, and we can guide you in finding more ways your app can help you and your customers achieve your goals.
So whatâs your projectâs projected ROI? Visit our Pricing page and make some rough calculations based on the ballpark youâre playing in. Or chat with a developer for a more concrete number.