Kirk Williams discusses the complexities of PPC pricing models at the State of Search Conference. He emphasizes that there is no perfect pricing model and highlights the importance of aligning pricing strategies with customer relationships and measuring value effectively. The presentation covers various pricing models, including hourly, performance-based, flat rate, and percentage of spend, detailing their benefits and concerns to assist businesses in finding the best approach.

1. The Great (1-Sided)
PPC Pricing Debate
Kirk Williams
@PPCKirk
State of Search Conference, Dallas 2015

2. Who am I? Who are you? What is life?
@PPCKirk

3. —————————
@PPCKirk

4. To the chase!
There is no
perfect PPC
pricing model.
@PPCKirk

5. To help us think more deeply about our
pricing & find the best model for our
individual situations.
“
”—————————
Our Goal Today:
@PPCKirk

6. but first…
*3*
Crucial
Caveats
@PPCKirk

7. philosophiam pretium
“What are the
underlying principles
that should drive our
pricing model
choice?”
your pricing
model should fit
with your
customer
relations?
how you
measure value
matters.
@PPCKirk

8. Principle #1 - How you measure value matters.
Time
Expertise
Task
Results
$
Aunt Edith Brad Geddes
=
@PPCKirk

9. &
My Take on Measuring Value:
Task + Expertise + Results.
@PPCKirk

10. principle #2: your pricing model
should fit with your customer relations.
@PPCKirk

11. Status Quo =
a la carte
STRESSED
brides
We Said:
“Screw
ala carte”
We raised
prices 50%.
Feedback from
Stressed Brides?
“We. Love. It.”
pricing should be seen as marketing
@PPCKirk

12. ask yourself:
“How will my future
price changes affect
my loyal client’s
orientation to me?”
pricing should be seen as customer retention
@PPCKirk

13. PPC Pricing Models…
There’s… too many of them!
@PPCKirk

14. Performance??
Combination??
% of Spend??
Flat Fee??
Hourly??
a PPC pricing model analysis.
Pros
&
Con
s
@PPCKirk

15. hourly
@PPCKirk

16. “hourly makes sense
to my corporately
trained brain…”
HOURLY Benefit #1: Pricing Simplicity
Client
(but…)
@PPCKirk

17. HOURLY Benefit #2: You *Have* to Get Into the Account.
@PPCKirk

18. HOURLY Benefit #3: Helps Prevent Scope Creep
Initial Agreement
2 weeks
3 months
6 months
1 year
@PPCKirk

19. “hourly makes sense
to my corporately
trained brain…”
HOURLY Concern #1: Pricing Disconnect
Client
“…BUT HOW MUCH
DO YOU MAKE AN
HOUR?!?!”
@PPCKirk

20. ≠
HOURLY Concern #2:
When you look
annoyed all the time,
people think that
you’re busy.
“ ”
Busy Work ≠ Good Work
@PPCKirk

21. HOURLY Concern #3: Discourages Speed & Skill Grow
@PPCKirk

22. HOURLY Concern #4: Screw You, Tools
@PPCKirk

23. Easy to sell, but selling your soul to the
clock isn’t worth it
“
”—————————
HOURLY SUMMARY
@PPCKirk

24. performance
@PPCKirk

25. I make $,
you make $
Performance Benefit #1: Rewarding
@PPCKirk

26. No future
haggling
required
Performance Benefit #2: Scaleable
@PPCKirk

27. —————————
performance pricing is like Dudley Dursley
(it’s everyone’s favorite, but is, in reality, quite booris
Performance Benefit #3: Sounds Great!
@PPCKirk

28. —————————
Performance Concern #1: Complicated Negotiating
@PPCKirk

29. —————————
Performance Concern #2:
What if Client Breaks Something?
@PPCKirk

30. —————————
Performance Concern #2:
What if Client Breaks Something?
@PPCKirk

31. —————————
Performance Concern #3:
Seasonal Trends
@PPCKirk

32. Can you really
trust them??
Cancelled
Orders
Phone
Orders
Tracking
Errors
Include
Brand??
Performance Concern #4: Data Accuracy
X
@PPCKirk

33. 38%
30%
12%
11%
9% Adwords
Organic
Facebook
Bing Ads
Referrals
Performance Concern #5:
Last Click Attribution. BOOOOO
1 Order
@PPCKirk

34. The Performance Model
Attribution Pie-Chart
PPC Everything Else
NOTOUCHY!!!!!
@PPCKirk

35. Looks like puppies and unicorns from
afar, Turns out to be werewolves &
donkeys.
“
”—————————
PERFORMANCE SUMMARY
@PPCKirk

36. flat rate
@PPCKirk

37. FLAT RATE Benefit #1: Simple to Sell
@PPCKirk

38. FLAT RATE Benefit #2: Pricing WYSIWYG
@PPCKirk

39. FLAT RATE Concern
#1: Not Growth-
Focused
@PPCKirk

40. FLAT RATE Concern #2: Can Invite Scope Creep
Initial Agreement
2 weeks
3 months
6 months
1 year
@PPCKirk

41. Simple selling with no eye for the future.“
”—————————
FLAT RATE SUMMARY
@PPCKirk

42. % of spend
@PPCKirk

43. @PPCKirk

44. Fee
$1000 $3000 $10,000 $50,000
% of SPEND Benefit #1: Simple to Sell
Fee
Fee
Fee
@PPCKirk

45. No future
haggling
required
Fee
$1000 $3000 $10,000 $50,000
% of SPEND Benefit #2: Scaleable
Fee
Fee
Fee
@PPCKirk

46. ¯_(ツ)_/¯
Fee
$1000 $3000 $10,000 $50,000
% of SPEND Benefit #3: Simple to Track
Fee
Fee
Fee
@PPCKirk

47. % of SPEND Concern
#1: Misaligned
Goals
ClientAgency
@PPCKirk

48. “Are we seriously going to have to go through this again?”
@PPCKirk

49. Client Agency
Can we please kill the misaligned goals attack??
Reality
@PPCKirk

50. % of SPEND Concern
#2: Client Issues
@PPCKirk

51. `
Larger SMB
Client
% of SPEND Concern #3: Small Account Issues
Medium SMB
Client
Small SMB Client
@PPCKirk

52. Scales well, but small business is the
pits.
“
”—————————
% OF SPEND SUMMARY
@PPCKirk

53. My Model
(combination)
+
@PPCKirk

54. Ad Spend Budget Management Fee
Tier 1 $0 – $2,500 $400
Tier 2 $2,501 – $5,000 $800
Tier 3 $5,001 - $10,000 $1,200
Tier 4 $10,001 - Up 12% of Ad Spend
% of Spend with a Flat Rate Twist
@PPCKirk

55. Prevents
Small
Account
Drain
Not Difficult
to Sell
Scaleable
Spend
Reduction
Means Work
Reduction
Client
Goals
Aligned
with My
Goals
% of Spend with a Flat Rate Twist
@PPCKirk

56. TIP: Always, always,
always charge a Setup
Fee
Each
build is
your
Mona Lisa
@PPCKirk

57. keep searching
for
the best model
for you.
@PPCKirk

58. State of Search Conference, Dallas 2015
Questions? Ideas? Insults?
——————————————————————————————————————
@PPCKirk
Slides & Links: bit.ly/ppc-pricing