One factor that plays a vital role in you deciding which PPC agency to choose is the price.
It is a difficult journey to find your PPC partner!
You need to find a PPC agency that has a great reputation, is the right fit for your business AND also has reasonable pricing.
A bit of a holy grail right!?
But what should we consider a reasonable cost for a PPC agency? What kind of benchmark should we be using?
In this post we look into some of the going rates for PPC agency services. We also discuss some common pricing models used and we reveal what you should expect to pay for a PPC agency.
PPC agency pricing models
The 3 most common pricing models used by PPC agencies :
Fixed Fee Monthly Retainer
One of the most common pricing models PPC agencies use is a simple fixed fee monthly retainer. This means that every month you will pay a single fee for the PPC management of your PPC accounts.
Percentage Of Spend
The percentage of spend pricing model is often used when the business has a larger media spend going through their accounts. This model enables the PPC agency to more easily ‘scale up’ the management time needed for accounts that spend more on online advertising.
Percentage of spend models usually start at anywhere from 10 – 20% of the monthly media spend.
For example, let’s say we’re managing “MyBusiness” and their Google Ads account. Let’s say they are spending £15,000 per month. If they were on a percentage of spend model at 15%, the monthly fee would be charged at £2,250.
Performance based
Some PPC agencies will give the option to their clients of paying for their services based on a performance basis. For example, this may be an agreed fee per lead or enquiry. Or it may be a percentage of each completed sale.
Minimum PPC management fees
Many PPC agencies will often offer a minimum management fee or ‘starter’ package for businesses.
Depending on the agency, these entry level PPC monthly management packages can start from anywhere between £150 – £500.
In the £150 – £200 price range, you will most likely be working with a smaller PPC service provider. This may be a freelancer or a PPC consultant with limited experience or a smaller portfolio of previous clients. Usually, this is someone just starting out in the freelance, self-employed world. The benefit of this price range is that you can find very skilled and talented individuals who you can form long-term partnerships with. The downside is that they can be hard to find and more often than not, you’ll have to go through your fair share of time wasters before you find your perfect match.
From around the £350 mark, you’ll most likely be dealing with PPC consultants and agencies and their entry-level packages.
PPC monthly management fees and retainers
Monthly management fees and retainers will always depend on the size of your campaigns, your budget and the platforms/channels you’re advertising on.
These fees are often calculated based upon the agency hourly or daily rate.
PPC Hourly Rates
The lowest hourly rate that you may come across will be around £50 per hour. However, this rate will be very few and far between.
You’ll be more likely to see hourly rates for PPC agencies of anywhere between £65 – £90 per hour.
However, some highly skilled and specialist agencies will have an hourly rate of £100+
PPC Daily Rates
PPC agency day rates will start from around £400.
The most common day rate will be in the range of £600 – £800.
However, this can be higher for agencies in London and other cities.
Larger, international or more exclusive agencies will rarely work from day rates but instead will work off of the percentage of spend pricing model. They may sometimes also combine this with a service charge or other fees.
How do PPC agencies decide on what to charge?
Like all businesses, PPC agencies will decide on their fees by first analysing their own costs. Overheads such as their office, rent, equipment & software will all play a part. Then it’s looking at their staff, staff costs, staff specialisms & experience. Then they’ll add a sum in order to make a profit.
Are PPC freelancers cheaper than agencies?
Usually a PPC freelancer is a cheaper solution compared to a PPC agency. However, a PPC freelancer isn’t suited to every business and sometimes, the PPC marketing needs can only be met by working with a team of skilled PPC professionals.
References & Further Reading
This post was created by using our own knowledge of the PPC & digital marketing industry as well as researching some useful resources across the web.
The following post from anicca gives another good breakdown of PPC agency costs:
https://anicca.co.uk/blog/ppc-agency-costs-to-manage-adwords-pay-per-click/
Also, The Wow Company’s annual agency survey is also a useful resource:
FAQ
Summary
PPC agencies can charge anything between £150 – £500 for their most basic PPC packages.
You can expect to pay from £50 per hour. However, most PPC agencies will charge between £65 – £100 per hour.
PPC agency day rates start from at least £400 per day. The most common day rate will be in the range of £600 – £800. Some agencies will charge in excess of £800 per day.
