Why Does the Cost of Search Engine Marketing Drastically Differ Between Agencies?

By Avelyn Austin | Dec 30, 2010
More Articles by Avelyn


Why does the cost of search engine marketing (SEM) – which includes search engine optimization and/or pay-per-click advertising – drastically differ between agencies? This is a question that I hear at least once per month from potential clients who are thoroughly searching for the right SEM agency.

For individuals inside the industry this question typically comes with the obvious answer that SEM agencies cost different prices because they offer different qualities of SEM services. That being said, for individuals outside of the industry, services may seem very similar and thus the drastically different price tags just doesn’t make sense.

So I’ve decided to take it upon myself to present a short list of phrases that should raise a caution flag for SEM shoppers as well as provide follow-up questions that SEM shoppers should ask to receive information that may make the price tag difference a bit more clear.

Caution Flag Phrases & The Right Follow-Up Questions to Ask:

Caution Flag Phrase #1:  “Our company has X number of employees”

The number of employees a company has tends to simply be a figure to show the size of the company. Especially, when shopping for SEM services, you’ll probably notice that agencies that offer SEM services also offer additional services such as webdesign, consulting, etc.

Therefore, when an agency presents how many employees are with the company you, the SEM shopper, should ask the following questions:

  • How many employees specialize in SEM?
  • What makes these employees qualified in SEM?
  • How many employees will be dedicated to my SEM campaigns?

Caution Flag Phrases #2: “We guarantee #1 rankings”

The truth is, no agency can guarantee #1 rankings for any keyword. If they do, it’s time to start asking these questions:

  • How can you guarantee #1 rankings in an ever changing market?
  • How long will it take to reach #1? (This is kind of a trick question, because no agency should be able to give a definitive answer)
  • Will you be writing this guarantee in my contract?

Caution Flag Phrase #3:  “Setup Starting at X dollars and monthly management at X dollars”

“Setup” and “Starting at” could actually be 2 separate caution flag phrases in my book.  When it comes to SEM it is relatively impossible to ever complete the “setup” phase.  With keywords, competitors, algorithms, products, etc. changing everyday, SEM is an ever evolving space and campaigns need routine “setup”.

When an agency says they “charge a setup fee starting at”, I encourage you to ask:

  • What does the setup fee include?
  • Are there additional fees each time the campaign setups are changed? If yes, how often are the campaign setups changed?
  • What will the setup fee for my SEM campaigns actually cost? And what will the monthly management fees actually cost?

The bottom line is, not all SEM services are the same when you look at the fine print between the lines. Be cautious as to how costs are stated, how a company’s specialties are described, and what results are guaranteed. I love a good deal just as much as the next gal… probably more… but when it comes down to SEM you often get what you pay for.

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  • http://www.brickmarketing.com Nick Stamoulis

    I also think it is true, you get what you pay for, so be cautious. I also don’t think exorbitant fees are necessary. We should all remain competitive in pricing. Ask questions, be wary of hidden fees, and remember, there are no guarantees, but be an educated consumer and you’ll be better off.

  • http://www.facebook.com/avelyn.austin Avelyn Austin

    I agree with you Nick, charging exorbitant fees isn’t good for the industry or the consumer. Each agency needs to assess their services, quality and overhead costs to define their prices accordingly.

    Asking about the hidden fees is a great suggestion. Customers should know whether their agency plans to nickel and dime them before they sign on the dotted line.

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  • http://thewebsensesolution.com Jon

    Good article Avelyn. My feeling on the subject is that finding value for dollar is difficult in the industry.

    What I have started to do is break down different aspects of SEO into their own standalone products, making it clear to the consumer what the cost of each step of my SEO campaign will be. Since I am only focusing on local businesses right now, it is easier to acheive location based results than competing against national keywords, and my pricing reflects that.

    SEO a very complex product/service, and there are way too many bad apples out there giving the industry in general a bad name. I think legitimate firms need to be more open and transparent about what they charge and what that accomplishes (without making false claims).

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