Embarking on adwords fees

Written by Fred Humfreys Tuesday, 19 April 2011 07:03

When looking in to starting a ppc management there is one consistent factor that you will be paying google will be debiting your credit card each month for the amount of clicks to your website. Firstly most businesses have their payment taken as a direct debit each month. Pre payment is a good option for those advertisers looking to get started that are conservative about how much they want to invest. The downside with this is your return on investment will always be capped and you could be using up your spend early in the month and missing out on clicks and sales that end up going to your competitors.

When looking in to starting a ppc management there is one consistent factor that you will be paying google will be debiting your credit card each month for the amount of clicks to your website. Firstly most businesses have their payment taken as a direct debit each month. Pre payment is a good option for those advertisers looking to get started that are conservative about how much they want to invest. The downside with this is your return on investment will always be capped and you could be using up your spend early in the month and missing out on clicks and sales that end up going to your competitors.

When you first get started with ppc you may manage it yourself but like anything you'll quickly realise that when you spend more that it can become a time intensive job that may be better managed by an agency. Its important to know that agencies structure their management fee's in different ways and indeed this doesn't always reflect the ability or skill of the agency.

Some pay per click agencies will charge a flat fee and this may seem like good value to the client. The problem may come when you look to analyse how much a flat fee will cover in a monthly period including timely tasks such as checking search query reports which outline which keywords should be added to the negative keyword list to ensure that the clients adverts do not show for irrelevant keywords. Other tasks such as changing bid prices, adding new keywords can all take time.

This is a common way of charging clients for your ppc management services by charging a percentage usually 10-20% of the total monthly spend. This does two things it drives the agency to work harder to improve the ROI of the account and lower the clients cost per acquisition, along with also find new ways to monitor conversion such as introducing new technologies such as split testing ad copy and landing pages known as conversion rate optimisation. This often isn't feasible on a low management fee.

As part of a new paradigm within the agency world larger advertisers will be asking for more bang for their buck and as an agency you need to evolve your pricing structures. A hybrid model is where the agency is able to charge a standard rate that covers numbers of hours on the account and then as a result receives bonus incentives as in line with increased performance of the account. It is common that this will mostly take place within larger accounts where the stakes are higher and so are the rewards.