How much should the PPC Administrative Fee Be?
In addition to building websites for attorneys, there are a few law firms that I work for as their “Director of Marketing”. More or less, it’s my job to field calls from sales people and try to make a determination as to whether or not it’s worth following up. Because one of the firms I do this for advertises on TV, sometimes I get a lot of these calls. I really enjoy them. It gives me a chance to listen to what my clients are hearing when they choose to actually take a call…or I’d imagine more likely, accidentally find themselves on a call with a sales person.
Phone Sales 101
Forgive me for being a guy who used to listen to sales tapes and actually bought a mirror to look in because I knew people could “hear my smile”. Forgive me for being a person that thinks that if you choose to bother people on the phone for a living that you should be professional and as polite as possible about it. I did it for a while, it sucks, I know no one really loves doing it, but this woman was awful.
Maybe it’s partially my fault; I don’t say “Hello?” when I answer my phone. I think it’s ridiculous and while it does lead to the exchange most people expect, it’s stupid. I didn’t just walk into a dark room, I’m not yelling into a canyon to see if someone else is there. I know you’re there. You just called a number that the only reason to call it is to talk to me. So we are not doing the “Hello?” …. “Hi is this James?” ….. “Yes, speaking”. That seems insane to me. To pick up your phone and then confirm that you are indeed the ONLY person who ever answers that phone….
That wasn’t awkward…I’ll show you awkward.
Anyhow, I answer my phone “This is James” and sometimes that can put sales people off rhythm or something. So she immediately says. “Hi! How are you?” which you are NOT supposed to say because the prospect can just say “shitty” and then the tone of your call is sort of a mess. I just say “fine” and then it’s dead air….about 5 seconds…and then she says “Jeez, we had sort of an awkward moment there”. So, I make it more awkward by not saying anything. Now, she does what she should have done right after I said “This is James” and starts with her deal. “I’m ____ from _____ and we help drive results through the web. Do you do any SEM or Pay Per Click marketing?”.
Now as soon as I realize that someone is trying to sell SEM or Pay Per Click marketings (or Google Adwords, the little ads at the top of the page) I only have one question; how much does it cost? It’s honestly the only rational question. When you purchase Adwords from anyone other than Google, that’s a re-seller. Anytime you buy from a re-seller, especially when a direct line to the primary company that sells it is available, you’d want to know what type of mark up you’re paying…makes sense, right? In the defense of PPC companies, they indeed DO deserve to charge you over and above, because you’re buying their expertise. A good PPC person / company can and should make the money you spend more efficient. The problem is in the incentive of the company you’re paying. I am going to have to deal with that in another post, but let’s just suffice it to say that it’s really important to understand how much they’re charging you.
She didn’t know….Anything.
(ME) So, how much do you charge?
(HER) Well, that depends, our consultants work with each account to determine the optimal budget….
(interrupts) No, how much do YOU charge, I understand that I’d be paying for the
Ad budget as well, but how much do YOU charge?
Well, um….it depends, it’s a percentage.
Great, and that percentage is…
Well, it’s different depending on how much you spend, because of course we’re not going to charge someone
who is paying say, $400 a month the same as we would charge someone who is paying $4,000 a month because…..
(interrupts again) So how much is it on $400 and how much is it on $4,000, what are the percentages?
Um…hold on (muffles phone) “yeah, he wants to know how much the percentages are…”
(comes back) I’m going to actually put you in touch with my sales manager, Jason because if you actually want to talk
about the percentages he’d be better to…
(interrupts again) Look, I don’t have time to talk to Jason. My email is firstname.lastname@example.org
and you can email me those percentages I will look at them. Thanks, click.
Sorry, I’m not Sorry.
Maybe that was rude. Maybe I am a terrible person. Maybe I should just politely decline and let her get on with her day. But at the same time, if she said, our administrative fee is only 5% for the first month so that you can get a feel for what we do for you. We also will let you have direct access to the Adwords and Analytics that we are using so that you can see exactly what we are bidding on and where your money is going. We can show you how we set up and measure metrics so you can easily differentiate between your paid and organic visitors, and most important of all we can show you that you are converting the traffic that we buy into new business. But she didn’t say any of that. She just told me that her company is good at PPC, and when I asked the most basic question, she didn’t know the answer. I honest to god don’t understand how any of these companies sell anything to anyone….ever.
What Should a Good PPC Administrative Fee Be?
It sort of depends on what you’re getting for it. Generally, If you’re paying a percentage, it should be very low, like less than 10%. I typically just charge a rate based on how many hours it will take to manage. However, if there is a monthly fee plus a nominal fee that is not totally unreasonable. The big problem is with companies (seemingly like this lady who called me) that don’t tell you. Comcast (at one point) charged 35% as their standard admin fee. That means you get $650 worth of advertising for $1,000. You also need to consider if there is any real strategy happening. If you are just outspending everyone for the most expensive terms, that might be effective but takes very little expertise.
Do you have questions about your PPC administration fees? Have you ever wondered where your budget is going? I can help you understand how Adwords works, and show you the stats directly from your account. I typically charge an on-going fee for managing Adwords, but I can also set it up on an hourly basis and you can run it. Questions? Call me at 651.271.8845 or click here to email me.