So you’re looking into outsourcing your SEO efforts and trying to get a feel for what is an acceptable cost for these services? Well the below post aims to give you some examples of widely used SEO pricing plans, plus where possible some information around specific costs.
Let me begin by giving a summary of the various SEO pricing plans that are used in the industry:
By the Hour Consulting
This is probably the simplest and most well used method of pricing in the industry, particularly with consultants and freelancers. The model is pretty self explanatory, the SEO will name their hourly rate and then bill you based on the number of hours completed in a given period time.
This can be popular amongst small to medium sized organisations because it gives them some budget control and allows them to potentially increase or decrease their SEO investments month by month by managing the time that their SEO contact puts into their business.
Some folk using this model may ask you to agree to a maximum or minimum per month, which is usually a worthwhile exercise even if it’s just verbally agreed. This gives you some kind of comfort knowing that your SEO will do a minimum of work, but also not a huge volume, which could result in a hefty, unexpected invoice.
Project Based Pricing
This is another popular pricing model amongst SEO’s particular if the work requires additional add-ons outside of just SEO, for example web design or some development. The prices are varied depending on the size of the project.
I have also used this method of pricing when I know the client just wants a single piece of work completing, for example optimisation for the local business listings. I have a general list of things to follow for this type of work, and know how long it’s going to take me, so I can charge a one-off fee to the client.
This can be a useful pricing model for clients who want to get some commitments around delivery dates. Failure to meet the accepted delivery dates can then be handled via some form of late delivery penalties.
Profit Sharing / Percentage of Increased Revenue
A more complicated and involved method of pricing that not many SEO’s use is a profit sharing agreement. The basic idea is that a snapshot of your businesses current revenue is taken prior to any work commencing. After the work has begun, the SEO will be entitled to a percentage of your organisations incremental revenue. That is if it does increase!
Usually there will also be some kind of upfront fee to get the work started, and this will depend on how much work is initially needed. For example if you need a whole new website, then you can expect the initial fee to be substantially higher.
The main disadvantage to this model is that an SEO’s primary job will be to improve the organisations organic rankings and drive increased revenue from new visits. They may not have any say on the website, or the offline processes. If you can’t have any control or say on these areas you may well find that despite your hard work and increased traffic levels the company is no more profitable because of underlying issues preventing them from taking advantage of the improvements.
Both an organisation and SEO should discuss this in detail prior to taking this route. I would personally look at this pricing model as a good option to move to after working with a client for some time and establishing a strong relationship. This way the SEO can get a feel for any process problems that might reduce the businesses attempt to generate incremental business, whilst the business owner can feel comfortable that the SEO is highly skilled and motivated to drive their business forward.
I think the advantages of this agreement do live mainly with the client because they can win on two fronts. They only have to pay the SEO if they increase the businesses revenue (minus the initial fee) and they know that as a result of the SEO wanting to get paid they will be extremely motivated to get things right, and quickly!
Monthly Retainer
With this pricing model an organisation will pay an SEO a set amount per month for an agreed level of service. This is heavily linked to the hourly consulting rate, in which most organisations will offer a set volume of support in a given period of time.
The disadvantages of this package as I see it are that certain SEO’s/Agencies will take advantage of less knowledgeable businesses and just pick up a cheque every month without doing the level of work they committed to. I have absolutely no doubts that this goes on to a big degree in the industry.
There is also the possibility that a consultant or agency will convince you that should you cancel or reduce the retainer your rankings will drop. Again in reality you may be paying for say 20 hours per month, but they may only be putting in 5.
You can sure this up, by asking them to give you a breakdown of the work they complete each month, but in fairness this could still be fabricated. At the end of the day you just need to find someone you feel comfortable with and try to keep check on how things are progressing. It helps if you have a basic understanding of what they are doing.
Pay for Rankings
Fairly self explanatory, some SEO’s will price their services based on committing to achieving certain ranking positions. The idea being that if they reach say page 2 you’ll pay a set amount and that amount will increase as the site moves up. All of this would need to be agreed beforehand with some targets around particular keywords that you wish to rank upon.
I would only recommend this model if you are targeting specific keywords that you know will drive conversions. For example, maybe you have found from your PPC data that 5 or 6 specific keywords are really driving awesome ROI, so you want to rank on them organically.
It can be a good motivation model because the SEO will have to commit to achieving certain rankings in order to get paid, but the more unscrupulous SEO’s among us might take advantage of this model. If the client is unfamiliar with SEO and not able to grasp the relevant competition of a particular keyword then the SEO may claim high prices for keywords that are actually relatively easy to rank upon with an hours work.
Pay for Traffic
I must admit the idea behind this model is pretty good. A client will pay an SEO based on the volume of incremental visitors driven from organic search after work has commenced.
There are a few issues with this method, for starters the SEO could technically click on your organic adverts and falsify your numbers (so keep a keen eye on your analytics data, especially reports like unique visitors, new and returning, Network Location).
It also doesn’t measure the quality of the traffic that is being driven to your site. You may well sell complicated IT services equipment, but the SEO has optimised your site for replica football shirts. The likelihood that this would drive you any incremental business is small.
Factors Effecting the Cost of SEO
So now you have a good grasp on the different pricing models in use, let me run through some more information about which factors will affect the total cost of any SEO work:
Competitiveness of Rankings
If you have a particular set of keywords in mind, an SEO should investigate your current websites standing vs. competitor sites ranking on those terms. From that they will be able to outline to you the likelihood of your site successfully ranking on those target terms.
At this point it is no good you saying “I don’t want to pay for back links, just make changes on the site” if all your competitors have 1000 backlinks, and you have none. The reality is you will have to pay for back linking work if you want to rank of these keywords.
Just be realistic about the terms you are trying to target and your relative starting point. If an SEO informs you that the competitive nature of the terms and your current starting point means it will cost £x and you only have £y then the SEO should investigate some longer tail search terms that will provide a good return on investment.
Complexity of Website
If you have a horrible website built on a shaky CMS system then expect any price quoted to be higher. If an SEO can’t easily action the required changes or have your in house developer action them then its going to be incredibly difficult for them to extract good value out of your SEO investment. They may have to put a lot of hours in figuring out your complex systems or outsource some of the development work themselves.
If you know your website is difficult to modify then don’t be surprised if the quote for SEO work is a little higher than normal. It’s also best to be honest upfront about any site limitations because it will save your money and the time of the SEO and probably change the direction of the strategy laid out for you.
Personality of You (The Client)
This has never been an issue for me yet, but if an SEO is asked to do some work for a client who is extremely controlling, and unwilling to trust what they are being told, then expect the price of the work to be higher. Nobody wants to work for someone who has just hired them as an expert only to then have to justify everything they say a million times.
As a client, you have presumably hired someone to do SEO for you because you or your in-house resource don’t understand it well enough to maximise its potential. As such if you select an external SEO to conduct it for you don’t start the relationship by getting on their back and trying to be clever about SEO. Give them a chance to get things moving, if you still aren’t happy then look for someone else.
Reputation of the Consultant / Brand
This plays a massive part on the pricing of SEO. If an SEO has a good reputation within the industry their fees and usually significantly higher than those with a less groomed reputation. The same rings true for the small agencies vs. the bigger, more established brands.
As a potential client though, you need to ask yourself just one question. Can Joe Blogs who is charging £20 per hour do as good a job as Johnny Bravo who is charging £300 per hour? Quite possibly not, but if the overall difference at the end of the project is a couple of places in the rankings or 100 less visits a month, who provides the better ROI? Probably Joe Blogs!
In this industry in particular, price does not demonstrate expertise!
Size of Company
Building on my point above, agencies that have a large number of in house employees have bills to pay. They have to pass this expense on to their clients, which tends to make them more expensive to work with than a smaller agency or consultant.
A lot of people will go with an agency because they think it provides a more guaranteed relationship than with a consultant or freelancer. This could be true in many cases because a consultant or freelancer could more easily go AWOL than an agency with physical offices.
The other point to consider here is that a lot of agencies claim expertise in SEO, but in reality they have to maintain a strict cost model to remain profitable. Good SEO’s aren’t cheap, so most agencies rely on one or two key experts and then farm out day to day tasks to low level worker bees. This works both ways however; as I know some consultants will outsource certain activities to Indian based companies for example.
Further Reading
For further reading in this area and some example of cost by service at low, mid, and top level I recommend an article put together by Rand Fishkin here, cost of SEO article.