…continuing the live blogging from Search Engine Strategies - San Jose 2007.

The third session of the third day is on the topic of SEM pricing, and is moderated by Misty Locke.

First up is Rand Fishkin.

Pricing must take into account the fact that there are many different services:

• Site auditing reports
• Standard consulting
• Keyword ranking
• Keyword research reports
• Content creation and copyrighting
• Link building
• Strategic planning and design
• Viral marketing (link bait creation)
• Social media marketing
• Reputation management and control
• Brand tracking and reporting
• Web development and web design
• Training and workshops.

Pricing model

• Hourly consulting - $100 to $400 per hour
• Monthly retainers
• By the project pricing
• Pay per performance
• Profit Sharing
• Hybrid models

Rand then went through some examples of pricing for past customers.

One of the biggest challenges is scalability. Therefore SEOmoz decided to go into products as well as services. It’s a one time investment with a long term return on investment.

Next up is Lance Loveday. His first point is to make sure that you price an engagement appropriately, otherwise you may find that you’ll be making a loss based on the amount of work that you’ll need to do.

Pricing goals

• Charge what the market will bear
• In line with client expectations
• Minimize risk
• Maximize upside
• Rationally justifiable
• What works best for the client

Fees are determined by:

• Scale of campaign
• new v existing
• International
• Geo-targeting
• PITA factor
• Size of client
• Est. Time

Management fees are determined by:

• Scale of Campaign
• International
• PITA factor
• Size of client
• Estimated Time

- His setup fees are usually 2-3x the monthly management fees.

Next up is Ken Jurina.

He lists 4 typical industry models

• Retainer 2k - 50k per month
• Pay per performance % of sales / leads / etc
• Fee for Service - $2500 - $1 million +, project based with finite scope
• Hourly Consultation - $30 to $1000 per hour

Do a SWOT analysis, find out what work you really want to do. Choose service offerings. Price what the market is willing to bear. For new firms, price to cover expenses / how much you need to live. Know your market and your competition. Don’t accept every client. Mid size clients seem to be the best companies to work with. Pricing is different based on the location of your customers.

Have proper detailed proposals, with the work outlined with the pricing.

The last speaker is Mike Murray. He lists some pros ad cons of performance based models, custom fee models, hourly models, and the fixed annual retainer, with the annual contract providing the best value.

If you’re consistent with the model, then it becomes much easier to manage multiple clients, easier for everyone to understand and easier for you to scale the business.

Filed under: Education and Training, SEO on Wednesday, August 22nd, 2007 by Simon Heseltine |
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