PPC Campaign Management Cost

[tcamp1]

My first post on any forum of any stripe, so please forgive any breach of etiquette.

I manage a small travel company spending £600-900 per month on PPC, (depending on time of year). We have a SEM company managing this for us at a cost of £575 per month. This seems excessive to me, as even though I am no expert in PPC I have managed some campaigns on a small scale myself in the past, and I can't see how my managing the campaign would cost us an extra £575 per month in higher CPC due to my relative lack of expertise. Obviously, it will also cost me some time too, but, sadly, with business as it is I can afford that.

Perhaps I am taking an overly simplistic view here. Any advice would be much appreciated.

Thanks,
Tim

 

[directmarketingadvice]

Hi Tim,

Think of it in terms of ROI.

If you're spending £800 per month on clicks and you're paying them £575, then they'll have to add 72% to your return on each £1 spent to be paying their way.

(1375/800 = 1.72)

If it were just left to run, let's say it would make £1.20 for every £1 in clicks.

(you'd be spending £1375 on clicks and getting back £1650)

That means they have to make it produce £2.06.

(you'd be spending £800 on clicks and getting back £1651.20)

That's assuming it's left to run unmanaged.

If you were to spend time managing it yourself, you'd have to deduct the value of that time from their fee and recalculate the numbers.

Hope this helps,

Steve

 

[Ecler]

A lot of search marketing agencies charge a percentage of your spend spend for campaign management (between 10 and 20%) so £575/month sounds quite excessive. However, many agenceis will not give these rates if you spend less than a certain amount per month, which could explain your current costs.
I think you should shop around and see what other providers could offer you, especially since you're in a very competitive market and your money would be better used in the campaigns themsevles rather than in a high management fee

Etienne

 

[LandingNet]

I agree with Ecler, £575/month is a huge amount of money to charge for managing a relatively small campaign. To give you some sort of idea, we would charge that sort of management fee for running a campaign with a spend 7 times the budget of your own.

To echo what Steve has mentioned, for every £1 click you get, it's effectively costing you £1.72 so I would seriously think about looking around for a new management company/professional.

When looking around, while it can be good to have someone local you can go in and have a shout at, ask for their experience level in the industry you're in as that'll give you a running start...

 

[JayZee]

That is extremely expensive - as others have said between 10 and 20% of spend is the average - they seem to taking between 50 - to 90% !

 

[faz]

I agree with above v. expensive average is around 10-20%

shop around as the saving will be worth your while.

 

[media]

thats 72% on the actual spend

can you PM me the company name, if you don't mind?

thanks

 

[tcamp1]

Not being a total ****wit, I have spoken to a few other firms in the past and been quoted similar money, so I am bit surprised that the universal reaction seems to be that we are paying well over the odds. I should probably point out that the £575 we pay the current firm covers PPC campaigns on both Yahoo and Google, totalling £600-900 per month spend between them.

FYI - Just had a quote in from one SEM firm asking for £680 per month (£340 Google and £340 yahoo), and a one off set up fee of £680!

 

[directmarketingadvice]

Not being a total ****wit, I have spoken to a few other firms in the past and been quoted similar money, so I am bit surprised that the universal reaction seems to be that we are paying well over the odds.

I don't think anyone can say you're paying over the odds. It all depends on what you're getting back for your money and none of us know what that is, except you.

Steve

 

[ADW]

Tim,

It sounds a lot when compared to the actual spend on ppc. If it were me spending that type of money I would speak a lot more in depth to Steve Gibson as he comes highly recomended from many people on here.

 

[Colin Parker]

Those saying that 10%-20% of monthly spend is 'about right' ie., the OP should be paying £80-£160 a month are shooting in the dark.

Even £160 equates to £40 per week which in my book equals a maximum of one hour's work on the account.

To split test ads and copy, analyse the results, write new ads + analyse ad positioning, bid strategy, keyword performance etc., + do new keyword research, write ads for new groups, advise on new landing pages etc., etc., ... you cannot do this level of PPC account management in one hour.

That is not to say that by the OP paying £575 they are getting the above level of management, unless they are fortunate enough to have found one of the very few PPC management companies that are knowledgeable, efficient and professional.

Most PPC companies simply set up an account, or take over an existing 'self run' account, applying some basic campaign structure and then leave the campaign to run on auto.

If you are spending less than £1,000 per month and paying just £20-£50 a week in management fee's I fail to see how you can expect anything else from the majority of PPC companies.

Colin Parker

 

[TonyParry]

Hi there,
I have been managing my own ppc campaigns for over 7 years. Initially, if a management service had been available I might have used it - now, having built up much experience I am sure that a) I can do as good a job and, b) even if I can't I doubt they can pay for themselves.

I would say, without a doubt, the best thing I ever did was to sign up with a really good tracking outfit (Saletrack.co.uk in my case) and really dig into the data you get - I have halved my ppc costs.

Go on - at £575 it seems excessive anyway and the experience is so good for you. It will keep you on top of your market.

Finally, every month check your bounce rates on your key landing pages and work on getting them down.

Good ppc-ing!

Tony

 

[webpromoterservice]

it definitely sounds a lot.are you in a contract? I am not suggesting you pull out,but if their not doing a good job,you might like to look elsewhere.

there are some good ppc agencies that charge a lot less and give good results.