As we have been invited into companies to review their Internet marketing campaigns we have been shocked to see how people are being ripped off on Google PPC campaigns. The range of waste runs from buying keywords that are ineffective to not tracking conversion rates in clicks.  We have seen companies double Adwords costs and bill the customer without disclosing true SEM costs.

Advertising agencies and PPC management firms handling Google and Yahoo SEM campaigns have to be compensated for managing a SEM campaign.  We have no issue with anyone getting paid for their expertise and we don’t give our services away for free either.

However, business owners need to understand how they are being billing for SEM management.  If the vendor is taking a percentage of your ad budget, like traditional commission models, we believe that you could be getting over-charged. Here is an example of how percentage commission SEM programs can not serve the business owner. 

Google Adwords Compensation Models

Let’s say you have a Google Adwords campaign that has been optimized but the budget is limited to $1,000 a day and the campaign does not run 24×7.  Now let’s say that its high season and the client wants to run increase the SEM budget from $1,000 a month to $2,000 a month.  This change takes all of 5 minutes to implement.  If the agency was getting 15-20% of ad spending, this simple tasks cost the business owner $200.

At PCG, we charge for our time and not as a percentage of spending. If a change on a Google AdWords campaign takes 15 minutes to change, that’s all our client gets billed.  This is a simple system and it keeps every ones interests aligned.

Is this a novel approach?  It seems so but we hope that by writing about this phenomena, eventually we will educate business owners to take ownership of their PPC budgets and inspect consultancy charges carefully.

If you would like to see the results of a truly managed PPC campaign, call us to setup a free consultation.