PPC Billing

[WilliamBay]

I'd like to add PPC as a service for my company. However I'm at a loss as to how to charge for it.

I've received cold calls from those "SEO guys" charging $200 for PPC services. But I doubt that they're very profitable or even ethical.

For you PPC guys, are you billing hourly on top of the campaign, and how are you outlining this for your customers?

Thanks!

[JamesNorquay]

Hi, Depends if you work with larger business they usually charge a service fee, similar to advertising agencys where you take a percentage of the overall spend.

For example if they spend 1 million a month you take a 7% service fee.

For smaller business they probably work on a similar method, case by case basis, all clients vary.

Some people may charge as high as 15% on a service fee.

Some people add on extra amounts per month.

hope this helps.

[Dekoda_Jones]

When i was at Fairfax (SBU named Advantate) we use to have a two tiered pricing strategy $200/month for basic set it up and barely touch it or $495 for more advanced package including analytics and feedback.  The problem with this moidel is that it doesn't allow you the flexibility to offer holistic solutions.

Having been int he industry for many years since those initial SEM days, I now strongly believe in creating contracts that share the risk with the client.  Come up with goals that are easily trackable and 100% reliable.  Share the risk by offering a low monthly fee, but a bonus they need to pay if you hit these goals and even a higher reward if you smash them.

There are always chumps that will accept a few hundred dollars to set and forget, but is that really the business you want to run?  There are enough snake oil salesmen out there, don't be another one.

[WilliamBay]

Bonuses are a really great idea and one I'm looking into with a particular client outside the industry of my normal clients (commissions actually).
Tracking becomes the issue. And since most of my clients are wedding photographers they don't always have a method of purchasing online. Do you have some recommendations for tracking services rather than products? It's easy to track the Click Through and if they filled out a form, but I will never know for sure if a client booked a wedding after contact.

Thoughts?

[Dekoda_Jones]

You should get in touch with a company called Jet Interactive.  They are a telco that have come up with a dynamic script that tracks phone calls from various channels such as SEM, SEO, Facebook etc.

They tie this into analytics to give you actual cost per lead/acquisition data.

[RikkiD22]

Personally I think the service fee as a percentage (in the UK the average is 10%) is the best way to go because it usually accounts for the extra work a larger account (in terms of budget) requires.

[SL_SEM]

One model I have seen used is to set a minimum for your services, and then use a goal based fee, or % fee based on spend on top of that floor.

Regardless of their spend though you need that minimum cost built in to get you enough time to cover your bases (reporting, meetings with clients, and initial setup costs spread out over duration of contract).

This can be troublesome as you may get someone spending $1000 per month and your minimum is $500 so they are paying you $500 at least to manage $1000. That is usually ok though as you don't want so many small accounts that your focus is too split.

This model helps you be flexible with larger accounts, and allows you to work with them based on the size of the campaigns, the management time you think it will take, and how detailed they want their reporting to be. It also helps qualify out smaller jobs that will probably just distract you.

We were going for fewer, but bigger clients though. The $200/month guys are going for volume. Both can be valid business models, it just depends on how you setup your management time, reporting, and costs for customizing your standard plans.

Hope that helps!