Topic: Pay Per Lead Vs. Monthly Retainer

I know this excellent course is primarily focused on selling leads, but I was wondering if anyone here manages PPC and SEO campaigns for local businesses on a monthly retainer basis.  I have mainly been doing this due to the fact that I like the recurring income that a group of monthly clients provides.  Of course, some of them only stick around for a few months but if you have enough of them and you're sending them a steady stream of business, then why not do this?  It just seems easier and more stable to me to do it this way than to have to constantly start from scratch.

In particular, with local SEO, it's sometimes really easy to get a decent ranking for local businesses by just changing the on-page SEO factors.  Almost no link building is required.  In other markets, I have spent months building links before seeing any results at all.  It's tedious work most of the time but can really transform a client's business in some markets.

Re: Pay Per Lead Vs. Monthly Retainer

I think that's a personality type thing. Almost the difference between entrepreneur vs employee... and I mean that as no insult. You have a very solid business model. But personally, it would bore me to death. I love my compensation having a direct correlation with the results I produce. The rewards can be huge, or non-existent... it keeps the game exciting, forces me to stay on my toes, I live for it. "Entrepreneur for the sport of it" as Chad says.

Both methods have their pros and cons. No right or wrong way, just different ways to skin the cat wink

Re: Pay Per Lead Vs. Monthly Retainer

I think one thing that also determines how you do business with a client is what the client is already doing.  I have a client that I do the LLG thing and send him leads based on a site I built and rank good SEO wise.  But I also manage his already existing adwords account (which he had no idea what he was doing) monthly.  So with him, I combined the 2. 

I have a new company that I'm talking to that I might be able to hit up w/ an monthly retainer for SEO work, plus ppc management, and still get paid per lead on other leads I generate via other traffic sources besides google (facebook for example).  So that's also a combination of the 2.

Re: Pay Per Lead Vs. Monthly Retainer

I tried it once early on and it worked out ok, but I decided to focus on the performance side of things.  There's nothing wrong with managing a clients campaigns if you decide to go that route.  Especially if you can get recurring monthly income for not much effort after the initial setup.

Re: Pay Per Lead Vs. Monthly Retainer

Thanks for the thoughtful responses guys.  I guess I'm always vacillating between the monthly retainer and lead generation models and it's always helpful to get the perspective of other people in the industry.  One thing I will say is that it's sometimes hard to have a lot of clients when you're juggling them all on a monthly retainer.  Some of them want to have you available all the time.  In this respect, it is like having a job. 

I work with clients through a web design firm, a search marketing agency, as well as on my own.  The clients range from small local businesses all the way up to large corporations.  I enjoy working with the full range of industries and budgets that I do.  With the larger clients, I have access to two full teams at Google, a team at Yahoo, and a team at MSN.  That can be really helpful for instance, in getting my ads approved quickly and having direct access to a live person if I have a question.  And because I live in the SF Bay Area, I get lots of nice perks like free lunches at the Google cafeteria as well. 

But I have to say that even working with a handful of small clients has been really rewarding.  I really enjoy being in this industry in a time where there's so much opportunity for even a one-person shop to help other small businesses grow.  I've had a few times when I've gotten a client more business than they can handle. That is such a great feeling.  I'm intrigued with the idea of switching to a more performance-based model and doing more lead gen.   

Thanks Chad for this awesome course and for this great forum where we can all share ideas.

Re: Pay Per Lead Vs. Monthly Retainer

It sounds like a good business you have going.  Whatever way you can work it and still keep the income flowing in all that matters.  It can definitely rewarding helping a business turn around an online ad campaign.  Also if you bill as a percentage of spend, you can be rewarded for increased performance.

Re: Pay Per Lead Vs. Monthly Retainer

I spent 3 years working with clients on a retainer basis after which I decided that I had enough and went into affiliate marketing. I can tell you that working on retainer sucks - performance marketing is much better. If you work on retainer clients always think they know better and keep asking you to change things, add useless keywords, etc. It's a big headache because of 2 main reasons:
1. It's a harder sell and it's harder to get clients.
2. It's a lot of work just maintaining the relationship with them.

I am now only working with clients on performance basis and it made such a huge difference for me.

Re: Pay Per Lead Vs. Monthly Retainer

Mike wrote:

I am now only working with clients on performance basis and it made such a huge difference for me.

Glad to hear its working out better for you!

Re: Pay Per Lead Vs. Monthly Retainer

Thanks for the insightful comments.  I definitely empathize with you about clients being difficult to deal with at times.  It's the main reason I'm strongly considering moving to the performance-based model.  Especially with the SEO link building--it's so time-consuming and tedious and really can take away from being able to serve more clients.

Re: Pay Per Lead Vs. Monthly Retainer

I currently have all my clients on a retainer and at times it becomes somewhat overwhelming.  I never thought of setting up the clients on a performance basis. Do you charge per lead or per paying customer? How do you handle phone leads? Currently for each client I put a tracking phone number on their site so I can track how many calls they receive each month. But I know some of these calls are from their current customers so it wouldnt really be a lead.

Re: Pay Per Lead Vs. Monthly Retainer

djmweb wrote:

Currently for each client I put a tracking phone number on their site so I can track how many calls they receive each month. But I know some of these calls are from their current customers so it wouldnt really be a lead.

Use their public phone number on their website and create a call tracker unique number on lead gen landing pages. If people are calling the lead gen number often then change it.

Charge them on a per lead basis and not on per sales. Too difficult in my opinion to track.