PPC Management Pricing: Are You Paying Too Much?

A lot of people assume that if you’re paying a lot of money for a product or service, it’s going to be superior than low-cost options. However, that isn’t necessarily true. In this guide, we’re going to go over PPC management pricing and how to figure out if you’re paying too much.

A PPC Management Service is supposed to let you focus on what you do best – growing your business. But are you paying too much for peace of mind with little results?

This is a common, yet costly, issue for expanding businesses. In this article, you’ll learn why you’re losing money on PPC, how much you should be paying, and how to save money on your PPC strategy moving forward.

What Is PPC?

PPC stands for pay per click. PPC is the foundation for most of your favorite ad Networks, from AdWords to Facebook. Instead of paying for an entire PPC strategy at once, you pay only when someone engages with your ad. This is a huge draw for business owners, but if mismanaged, it’s like flushing money right down the drain.

Here are several reasons why PPC campaigns lose money:

• Targeting the wrong audience
• Competing for pricey keywords
• They’re not optimized for mobile
• Not tracking performance or results
• Not implementing a PPC strategy
• Depending on Broad match
• Uninspired ad copy

In the hustle and bustle of running a business, it’s easy for details like these to fall through the cracks. These mistakes add up and they certainly don’t help your conversion rate.

That’s where your PPC Management Service comes in.

What Does a PPC Management Service Do?

PPC managers are responsible for managing pay-per-click accounts across all PPC ad Networks. But what does this mean for you, the business owner? What should you be getting for your money?

In addition to avoiding the aforementioned problems in the previous section, your PPC manager should be responsible for the following:

• Strategic planning and implementation
• Achieving a good return on investment (ROI)
• Deliver PPC campaign reports
• Quality copywriting
• Market research
• Campaign performance tracking
• PPC budget management
• Keyword Research
• Setting conversion goals

Let’s cut to the chase. How much will this cost you?

Paying for PPC

How much you’ll pay for PPC management will depend on a number of factors, from your target audience to marketing needs.

For example, an audit may reveal that social ad networks yield more conversions for your business than Google AdWords. Understanding which channels work best for you will help you calculate how much you’ll need to pay. That’s why it’s critically important to set goals before forking over the cash.

Ask yourself how much you want to make from PPC. Do you want to make $5 from every dollar you spend on PPC ads? Are you using PPC to grow brand awareness? How much are you willing to spend to improve your visibility?

Asking yourself why you want to use PPC is a smart way to avoid costly mistakes down the road.

PPC Fee Structures

Another way to anticipate your costs and avoid over paying is understanding PPC fees. There are a few main PPC fee structures to know: percentage of spend, percentage of profits, number of keywords, monthly management fees, hourly management fees, and setup fees.

A common percentage of spend fee hovers around 10% percent to 20%, with a minimum fee between $300 to $500. Therefore, if your monthly ad spend is $1,000 expect to pay a POS fee of $300 or more per month.

Ideally, the more you spend each month with a results-driven PPC management company, the more sales you should generate. If your sales are increasing with your spend, this is a good sign and even an opportunity to expand your PPC strategy.

If you’re spending money and not seeing conversions, that’s a big red flag. This could mean that your PPC manager is not targeting the right keywords or using high-converting ad copy.

A PPC management Service may also charge you by the hour. If this is the case, it’s important for you, as a business owner, to be acutely aware of how those billing hours are used. A fee structure like this may help you identify opportunities for cutting back on your PPC budget.

Timing is Everything

If you’re new to PPC advertising, it’s important to understand that it takes a couple months or more to start seeing results. PPC success is an involved process that doesn’t happen overnight. For new accounts, PPC managers need time to generate keywords, perform market research, a/b test ads, set up analytics accounts, and hire copywriters before launching your campaign.

Once your PPC campaigns hit their stride so to speak, expect your monthly PPC management bill to even out. That’s why it’s important to consider contract length in your payment calculations.

Ask yourself, once your PPC campaigns are automated and performing well, how long do you want to use your PPC management service? Would you rather use select services moving forward? Confronting these questions ahead of time is one way to save money on future pay-per-click costs.

Consider a 3-month contract first and go from there. You should also ask yourself if you want a contract that auto-renews every few months.

What’s Your Return on Ad Spend?

If you’re paying too much for PPC management without a decent return on ad spend (ROAS) to match, then stop what you’re doing and reassess your PPC plan.

One rule of thumb is to divide your total conversion value by your total cost of advertising. For example, let’s say you have a lead generation company. If you spend $10,000 on an AdWords campaign that generated 350 leads, and you sell 200 of those leads to an agency, your total conversion value would be $70,000. Divide your conversion value by your ad spend, and you would have a ROAD of 7% or 700% – not bad!

Investing your PPC efforts where they matter most is a surefire way to boost your ROAS and save money in the long term. But is your PPC management Service making the most out of your budget?

Moving Forward

Now that you have a feel for PPC pricing, it’s time to choose the right management solution for your needs. Use this post as a checklist as you plan your budget and narrow down your choices.

Don’t forget–knowledge is power! Check back often for more insider tips or contact us now to speak directly to one of our own PPC experts.