- June 20, 2018
- Posted by: Biplab Poddar
- Category: Google AdWords, PPC
What are the fees for managing Google AdWords PPC?
Google AdWords and PPC (pay per click) have grown up to be the most essential tools for any business that are willing to increase traffic towards their websites and thereby generate new leads and increase their sale. However, the small business houses do not actually understand the technology and therefore find the PPC jargon and AdWords set up very complicated. These small firms do not have any interest for investing in PPC training and therefore they should consider hiring a specialised PPC agency for setting up as well as managing the account in a professional manner.
Most of the agencies work for finding a solution that will benefit both the client company and the agency.
Why should you opt for PPC services through agencies?
Google aims to make money too so if you are not smart enough to understand certain techniques and principles, for instance, remarketing, quality score, targeting, bid management, conversion optimisation, etc. Or else you will find yourselves paying twice the price than the number of clicks you are getting. Also, for each conversion, lead or sales, you could be incurring more expenses than the actual work.
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Types of PPC management service:-
Two main types of PPC management services are available for the small business houses:
- Managed account with additional ad spend as well as monthly management fees and at times separate set-up cost
- Fixed price package all inclusive of clicks and management costs and at times including set up costs too.
1) Managed account with additional ad spend plus monthly management fees:
This is the most common type of PPC service in which the agency charges a certain amount of management fees separately other than the costs of clicks. The clicks are charged separately after they are itemized. In some cases, you may get charged for the ads spend on direct basis and you will be charged directly through debit or credit card. But there may be loopholes in this that many of the agencies may not provide you any access to your account and they themselves pay your ad spend and charge the amount onto you. Some of the unscrupulous agencies might inflate the amount you are going to pay for the clicks and you cannot even find out what’s happening for you are not directly paying the bill.
2) Fixed price PPC package with management fees and clicks (all inclusive):
These all inclusive packages are intended for aiming at the small scale businesses who want to spend as less an amount of 1000 pounds or lesser than that for all the services. This all inclusive service is offered by the larger Google partners who work for thousands of clients who spent only a few hundred pounds for a month and get the PPC services done. This type also has an issue that with the all inclusive fee charged by the agency you cannot really determine the amount of budget that is spent for clicks and the amount spent for management fees. So you should look for a more transparent report or at least the number of clicks you are getting on a monthly basis.
PPC Management fees
How much percentage is to be spent :
This is a very important form of billing and most commonly the percentage remains 10%-20% of the ad spend but there can be fluctuations in this percentage. For instance, if the advertiser spends $500 in a month and if the agency charges only 010% of it, then it comes round to about $50 per month for the PPC management fees. But this is way too lower for the fees and the agency then will be unable to make any profit. Therefore, the advertisers should pay higher percentage for the management fees whereas for the larger spends, the percentage might decrease.
PPC management fees effect on an agency:-
If an advertiser spends a set amount of money every month, it can become a predictable amount of income for the agency. In case, one has a fully automated system, the agencies can make more profits in comparison to the other forms of billing. On the manual system, you need to track the duration spent by each analyst on a company managed by them.
Effect of PPC management fees on the advertisers:-
If the advertiser is spending more, the bills for the PPC management agencies also increase. But the most important thing is trust between the advertiser and the agency. At the initial stages, the advertiser should give upper limits on the amount he is willing to pay on a monthly basis and then he can have predictable bills by the agencies. Most importantly, being an advertiser, you should be able to trust on the PPC agency with whom you are working. The incentives of the agencies lie in several factors, one of them being to get the advertisers’ spent increased by each month thereby making more profits. If the agency increase your spend and your profits also continue to rise, nothing can be better than this. This usually happens with the agencies that test various keywords and ad copies to get the advertisers the results and therefore they would be willing to spend more and more. But in case, if the spend of the advertiser is increasing but he is not seeing enough conversions, then he must check out the issue as the agency might be bidding on the untargeted keywords and thereby increase your spend by dubious means.
Which is the best type of PPC management agency for your company?
One needs to properly identify an effective PPC agency which will provide a proper and suitable service to a business. PPC agencies vary depending upon their size and expertise scale and usually gain specialisation with a certain number of ad spends.
1. Small scale agencies and freelancers
These agencies target business houses and operate ad spend of lesser than 1000 pounds on a monthly basis. These agencies tend to offer fixed fees of 350 pounds or even less than that on a monthly basis. They spent only a few hours on an account per month. Also, the size as well as complexity might be limited and they may also lack the expertise to use several features within Google AdWords and all the other alternative platforms. These companies only focus on the generation of clicks and put less focus on the conversion tracking or linking the accounts of the investors to Google Analytics. These small agencies may not get accredited by the Google partner due to its smaller ad spend.
2. Medium sized agencies
These types of agencies have a tendency to target business houses with ad spend of 500-10,000 pounds on a monthly basis. They provide a fixed amount for the fees. The management fees here are more affordable when compared to the large scale agencies. They offer a wide range of services and use complex setup of accounts. They link with other platforms like LinkedIn, Facebook and Bing Ads and use with various tools and software. These agencies spend more time compared to the small scale ones in the optimisation of the clients’ accounts. They also try to maximise the rate of conversion of the accounts and thereby improve the ROI. These agencies may be probable Premier Google partners. But they use third party tools and do not always have their own bid management or reporting tools.
3. Large PPC agencies>
These are specialised ones and tend to gain a large number of customers and they have a minimum of ad spend on monthly basis as high as 10000 pounds. Large scale PPC agencies include at least 10 managers for handling the different accounts and some of them may handle multiple number of accounts or singly. They have their own bid management or at times hire third parties and other tools for handling the complex accounts.
PPC pricing structure:-
PPC agencies offer their services based on various pricing modes:
- Set up fee
- Monthly fee (fixed amount)
- 10%-15% of the total ad spend
- Per hour rate that depends on the work
- Monthly fee depending upon the size and expertise of agency
- Small scale charges around £350 whereas large scale PPC agencies cost £1000 on a monthly basis
Important factors to be considered before selecting a PPC agency for you
- Experience level
- Accreditation from Google or Bing
- Number of accredited staff
- Other services offered by them
- Level of experience of your account manager
- Minimum contract period
- Charging structure
- Transparency level
- Technologies used for the work
- Extra charges need to be figured out, if any, for bid management tools
- Type of reports you will be provided
- Ownership of your account at the end of the contract