As an agency owner, it isn’t easy to value your time and expertise, as well as stay competitive when it comes to pricing. We all want to be chosen by clients for more than our prices, but it can’t be denied that cost will always play a part in a client’s decision.
We surveyed 883 agency owners to identify how they are currently pricing their services. The aim of this was to lift the lid on what agencies factor into their pricing structures, how it differs depending on their size, and what success they have as a result.
Our PPC Agencies Pricing Survey 2021 reveals exactly what agencies are charging right now for their services, as well as how COVID-19 has impacted their revenue.
Could these results impact how you situate your business in today’s competitive environment? Here’s some examples of what we discovered; download the full report to access all the results.
About The Study
Our data for this study was based on the responses from digital agencies and freelancers from across the globe. We set out to collect as many as possible to provide you with a solid understanding of pricing structures and fees across the PPC industry.
From the survey, we received 883 responses from a range of professionals who work in either Full Service agencies, PPC agencies, performance marketing agencies, or freelance PPC management and/or paid social media management. Our questions spanned everything from their hourly rates, monthly retainers, and base fees to how COVID-19 has affected their prices.
All answers were voluntary and anonymous, incentivizing people to be honest and open. We found many respondents were keen to provide valuable insights on agency pricing.
- 53% of agencies are emerging from the pandemic with increased revenues.
- Dedicated PPC agencies charge around 20% more per month than Full Service agencies.
- 59% of agencies use a pricing structure involving fixed fees (monthly retainers and hourly fees.)
- For agencies with fewer than ten staff members, moving to charge a % of ad spend might act as a differentiator and competitive advantage.
The most common pricing amongst agencies is a fixed retainer, regardless of ad spend.
We found larger agencies are more likely to use a pricing structure involving a % of ad spend, whereas smaller agencies are more likely to charge a fixed retainer. Meanwhile, most agencies charge between 6% and 10% of ad spend as their management fee and those charging hourly rates charge between $81 and $150 per hour.
The most common pricing range for agencies using a monthly retainer model is $1,001 – $4000 – just 13% of agencies charge more than $4,000 per month.
We’ve unpacked more of our findings below, so read on for the details.
How Are PPC Agencies Charging For Their Services?
The most common pricing structure among respondents was a fixed retainer, regardless of ad spend, with 35% of agencies utilizing this payment structure. Methods involving fixed fees, be those monthly retainers or hourly fees, made up 59% of agencies’ pricing structures.
We found charging for services based on a % of ad spend is the third most common strategy with 21% of agencies using this method.
Furthermore, 4% of agencies are backing their team’s ability to deliver by utilizing a performance-based pricing strategy.
What Is The Average Agency Monthly Retainer?
The most common price range for agencies using a monthly retainer model is $1,001 – $4000. Just 13% of agencies charge more than $4,000 per month, whilst 52% charge less than $1001.
Dedicated PPC agencies charge around 20% more per month than Full Service agencies.
Premier Google partners ($2150), and Standard Google Partners ($1600) both demand higher monthly retainers than non-partners ($1500). There is still value in gaining Google Partner Status.
What Value Do Agencies Put On An Hour Of Their Time?
Most agencies charging hourly rates charge their time between $81 and $150 per hour. The most significant factors impacting this are agency type and location:
- 88% of PPC agencies charge $80 an hour or more, whilst just 66% of Full Service agencies do so.
- 76% of agencies in the USA charge more than $100, only 21% of agencies in the UK charge more than $100 per hour.
What Monthly Ad Spend Budget Are Agencies Working With?
41% of agencies will work with monthly ad spends less than $1,000 which is possibly an explanation for how popular hourly rate and fixed monthly retainer pricing strategies are.
Furthermore, there is another divide across the pond with 87% of agencies in the USA working with monthly ad spends over $1,000, compared to 58% of UK agencies.
Download The Full Report
If you’ve found these pricing insights helpful, you can download the complete report to find out the full details of our survey.
They include answers to questions such as:
- Do Google Partner agencies charge differently for their services?
- How many clients are agencies working with?
- How does agency type impact pricing models?
- How does the size of an agency affect their pricing strategy?
These valuable insights are a great way of knowing exactly what’s going on with your competitors and if your current pricing is getting the most for your business.
Is it worth gaining Google Partner status? Or should you focus your efforts on other things, such as the type of client you go after?
Find out by downloading our PPC Agencies Pricing Survey 2021 now.