Advance Your Agency is a BrightLocal series designed to equip you with the skills, knowledge and advice necessary to take your agency operations to the next level.
This month we focus on pricing, something that can be a thorny and difficult issue for all kinds of agencies.
One of the most common questions we get at BrightLocal is ‘how much should I charge for local SEO?’
It comes from fresh-faced SEOs dipping their toes into the local space and experienced consultants alike, and the answer is never a simple one.
While I’d love to be able to say: “It’s $500 a month – that’s what everyone charges,” and grab a neat featured snippet for my time, the fact is that the answer is the same as it is for many SEO questions:
Still with me? Haven’t bolted grumpily out the door after not getting the clear-cut answer you wanted? Great, you’ve probably got what it takes to develop a considered and appealing pricing plan that will better pit you against your competitors and give you the edge when compiling pitches.
Before we go on to how to decide what to charge, though, let’s talk about when to charge…
The first question to answer is whether the work you’re pitching for is going to be on a retainer, a piece of project work, or paid for by the hour or day. I’ve defined these below, and provided thoughts on who they’re most suited to.
A regular (usually monthly) payment provided for equal use of your time and expertise each month. You arrange with your client what this work will consist of and agree top-up fees in months where additional work is required. You can offer a retainer based on time spent per month or deliverables complete per month.
Which agencies are most suited to retainers?
Which clients are most suited to retainers?
One-off projects that are performed for an agreed sum. Timescale and scope of work is agreed between client and marketer at the start of the project. Once the project is over, there is no guarantee of further work.
Which agencies are most suited to project work?
Which clients are most suited to project work?
As the name suggests, this is a simple daily/hourly rate billed based on the time you spend working for a client.
Which agencies are most suited to daily/hourly rates?
Which businesses are most suited to daily/hourly rates?
If you’re the type to make highly data-driven decisions, then the below charts may help. They’re pulled from our Local Search Industry Survey 2020, which is definitely worth a read when you’re done here.
Here you can see that, of all the local SEO-focused agencies, consultants and freelancers we polled, the two types of retainer (based on deliverables/based on hours) are clearly the most popular solution. And it’s easy to see why! Most businesses, particularly fledgling agencies, need regular, assured income and the retainer is the way to achieve this.
The retainer also reflects the nature of local SEO work better. If you’ve convinced your client (rightly) that improving local search performance and using local marketing tactics to reach new customers and generate revenue is an ongoing project with no clear endpoint, then a monthly retainer is a natural solution that reinforces this strategy.
Those of you who stuck with me at the start but who are still holding out hope for a clear, easy-to-digest price to charge could do worse than take a look at the following chart.
If you want to use the size of your agency and the number of staff you have as prime factors for what to charge on a monthly basis, then there you have it. But I’d argue that what you charge your clients, regardless of how you charge them, really comes down to several key considerations, which I’ll go through below.
The BrightLocal research piece mentioned and linked to above really is a treasure trove of insights into what and how local SEO agencies say they charge their clients, so you should take the time to absorb it and try to use it as a baseline for your pricing decisions.
You’ll also learn that the average monthly charge for reputation management is $359 (the median is $200) and that the average local marketer charges $389 for citation management work for a new client (the median, coincidentally, is again $200).
But that’s not all that’s included! If you’re looking inward and want to think about how much your time’s worth, there are interesting statistics on salaries, working hours and the job market. Plus, you could even use the survey as a baseline for your service offering, as it includes a section on the services most commonly offered by local SEO agencies and freelancers.
I hope that’s enough for you to take a deep dive into the useful figures and analysis of the Local Search Industry Survey 2020. Look out for another in early 2021!
If you’re planning on keeping your local SEO work, well, local, you’ll want to consider the economic geography of your chosen playing field, be that at a city or state level. There are a few factors here that can affect not only what you can reasonably charge but also what your clients can reasonably afford, regardless of how powerful your pitches might be.
As a local resident yourself, you’ll no doubt have an understanding of the local economy, what the wages are like around your area, and how profitable different types of businesses are. This needs to be factored into how you price your services, as being in a highly cosmopolitan area is likely to drive prices up, regardless of the quality of services received or offered.
When looking to understand exactly what local businesses are willing to pay, it can be tricky to learn to walk the tightrope of enquiry and snooping. But it can be done: consider holding or attending networking events and striking up conversations in local business forums online.
If you exercise tact and informality with your conversations and questions, you’ll get a feel for how seriously businesses are taking their online presences and how much they’re willing to put aside to improve them.
Another important, but somewhat less impactful, location factor is population and business density. If your client is the only dentist in the area, they’re not going to be hurting for local visibility or clients (however they might have got blasé and dropped the ball on customer experience, meaning that reputation management services might be suitable).
At the other end of the scale, larger cities can have dentists competing for local search visibility that differs every block. Suddenly the Local Pack becomes a turf war and rankings become more and more prized.
This is especially true when all competing businesses are firmly aware of the importance of reputation and have invested in it to the point that they’ve all plateaued at 4.8 stars on Google Reviews.
So you need to consider how valuable, and in-demand, different local SEO services are, depending on the population density and client’s sphere of influence. As we’ve just touched on, the industry you’re serving plays a big part in this, too, which brings us nicely on to…
Perhaps less relevant for those just starting out with their agency, but very impactful when it comes to pricing, is how specialized an SEO agency or consultant is. This specialism, or focus, can be in:
It’s generally considered that an agency or consultant that specializes in a particular field of marketing, and that has been around for a while, must have had enough success with prior clients to warrant this focus — it just makes logical financial sense. If you weren’t one of the best social media experts among your peers, why would you try to position yourself as such?
This naturally means that specialists tend to be more senior SEOs with a proven track record in their given field, a virtual rolodex of satisfied clients, and a healthy stock of testimonials and case studies. if this sounds like you, then you’re likely able to charge more for your time.
In a similar vein, specializing in delivering services to a specific industry or niche can help to elevate your status to expert, again based on the natural assumption that focus=experience.
However, specializing in a given field doesn’t require quite the same level of expertise and experience if you’ve chosen an industry with a very healthy competitive landscape in your chosen area. You’ll need to show that you’ve performed exceptional work for relevant businesses and that you clearly understand the unique local search aspects of your chosen industry.
Good examples of industries with specialist requirements in local search are law, medical and dental, service-area businesses, restaurants, and hotels. These requirements actually lend themselves, over time, to the additional development of a marketing discipline focus.
To put it another way, if you only work with restaurants, you’ll be dealing with review generation and social media a lot, so you’ll naturally hone your skills in that area!
Specializing in discipline or industry is a great way to improve the selling power of your services, providing you’ve taken a look at what’s feasible and relevant to your location (as discussed above).
Those just starting out on their agency journey, however, might want to start by developing a broader set of skills for a wider range of industries in the first instance, particularly as marketing is a holistic thing. Developing a true understanding of the gamut of local marketing tactics, from content to PPC to social media to GMB spam fighting, allows you to see how the puzzle fits together, so you can later focus on one particular piece.
Don’t be disheartened if you feel a lack of specialism means you won’t be able to charge a lot for your time, though. Remember the old saying, a ‘jack of all trades’ is a ‘master of none’? Well, how many businesses do you know that can afford one ‘master’ of PPC, another ‘master’ of on-site SEO, yet another ‘master’ of reputation management, and so on? Sometimes it pays to be the jack, provided that what you charge reflects your broader, but perhaps less deep, skillset.
If you’re looking to develop a specialism, take a look at the following research pieces from BrightLocal, which highlight which industries need help in which areas.
Earlier we looked at research into what the average SEO charges on a monthly and hourly basis (as well as the, perhaps more realistic, median), but does that mean you should set up your pricing plan to reflect this, perhaps undercutting a little here and adding margin there? Of course not.
As we’ve already discussed, your positioning, experience and location should have significant influence on your price point, but there’s still more to it: no-one works in a vacuum; it’s time to look at your competitors.
There are many reasons to monitor your direct competitors in the marketing space, and understanding and comparing pricing models is just one of them. Comparing services, website messaging, attitude, customer satisfaction, reputation and performance are all valuable ways to allow you to position yourself differently and more appealingly to your given client.
That said, there’s nothing quite like knowing exactly what your competitors are charging for comparable services. This gives you a real edge in the game and is naturally going to influence your pricing.
The only problem is that, far more often than not, marketing agencies don’t display their rate cards on their websites or discuss this kind of thing openly on social media (for the precise same reason you want to get at those rate cards).
While I could suggest you contact your competitors anonymously to ask for the pricing plans, I personally feel that’s rather underhand. There are other ways of getting an idea of what your potential clients are paying, and they start right there, with the very people you’re competing for.
If, from the very start of your relationship with a potential client, you can develop a good rapport with them by always being open, honest and friendly, you’ll feel much more comfortable asking the difficult questions later on. Remember there’s nothing wrong with asking which other agencies are in the mix when it comes to a pitch, and if you feel it’s appropriate, you may well be able to come right out and ask what they’re charging for what.
Even if gaining competitive insights this way isn’t productive, remember that every lost pitch is an opportunity to learn about your competitors. If you know who you were up against, and you learn in your post-pitch communications that price was a determining factor, you can make a note that that agency is charging less than you for an equivalent service.
Do this a few times and you’ll have a clear picture of where your pricing sits in terms of your competitive landscape.
While it might not be suitable for every local SEO, setting up a simple pricing plan that stays fairly consistent between pitches is a great way to simplify pricing and allow potential clients to build trust in your agency.
If what you’re proposing is clear and easy to understand, there’s nowhere for you to hide hidden costs. This will appeal particularly to those potential clients who have perhaps been burned by an SEO agency in the past.
A local SEO pricing plan is best suited to agencies kicking off an ongoing retainer with a client. Sure, there might be some one-off tasks on there, such as a local SEO audit or a citation-building campaign, but the majority of factors that keep local businesses high in rankings require ongoing work and investment. These include Google My Business management, spam fighting (depending on the industry), link building, and so on.
If you’ve read our previous Advance Your Agency guide, ‘What Should I Do in My First 6 Months With a Local SEO Client?‘, you’ll already have a good idea of what tasks to include in your pricing plan. The question is, how much should you charge?
Once you’ve gone through the factors that affect pricing that we discussed earlier, such as local economics, specialisms, and competition, you’ll have a fair idea of what’s realistic to charge before potential clients scoff at your prices and turn their backs. However, it’s not just client expectations you have to be realistic about, it’s what you can achieve in your own time.
Consider this: your pricing plan includes a single charge for writing and placing five guest blog posts linking back to your client’s site per month. Sounds reasonable, right? Provided you have the time and skill, you could achieve this and the client would, over time, benefit from it.
Now let’s say this tactic works well, and your client spreads the good word around about your agency. Suddenly three other businesses are knocking at your door, wanting the Content Hero they’ve heard so much about.
If you’re sticking to the same pricing plan, as you probably should, the same charge for five blog posts per month all of a sudden isn’t quite so achievable. As a small agency, are you about to churn out 20 blog posts of good quality per month, while also working on the various other factors we know impact and improve local search visibility?
Sure, you could trawl the web for freelance writers or hire new staff in a mad panic before your new potential clients lose interest, but there’s bound to be a dip in quality.
The issue is this: your pricing plan was never scaleable in the first place. Through greed or ambition, the local SEO tasks you said you could perform in a given month simply aren’t achievable in the same number of hours for two or more clients.
So the takeaway from this is to start your pricing plan small, and leave room in your month for additional client work. Be realistic about what you can achieve and about your pricing plan and you’ll prevent yourself from ever having to stress about managing expectations.
Borrowing from the SaaS world, a popular model for local SEO pricing is that of tiered pricing plans (e.g. Bronze, Silver, Gold). Provided you have some clients under your belt and have experience in what each set of tasks can truly deliver, you can confidently package your services up in this way.
The benefit of this is it’s easier for the potential client to understand the comparative value of what they’re paying for. Also, if you name the plans after the types of clients they best serve (e.g. Small Business, Multi Business, etc.), so that the plan name and description immediately speaks to them, you’ll have an easier time convincing them that you have a plan that suits them.
A good way to approach this is by having the plans quite simply scale in terms of size, rather than scope, of operations. With this model, every plan includes the same tasks, but what changes is the amount of time devoted to them.
For example, you could have one plan that offers one guest blog per month and two hours spent monitoring reviews, another that offers two posts per month and four hours spent on reviews, and so on.
This is probably the simplest model for clients to understand, and inherently acknowledges that every local SEO task you perform is critical for every business.
Conversely, removing some tasks from your smaller plans can leave clients with a fear of missing out, meaning they may be more likely to consider a more expensive package just to ensure their local SEO strategy covers all bases.
At the early stages of your agency, it’s fine to play around with different pricing models for different clients, testing different plan names and contents, but always have in mind the goal of reaching one core pricing model that you know is a good fit for all businesses. If you do this, be sure not to advertise your rate cards on your website, for obvious reasons.
If, early on, you have a client you have a particularly good relationship with, you could use them as an ambassador client, and test a strategy and pricing plan on them to see what you can achieve on that plan.
Later on, though, once word gets around about your agency and businesses start to compare what you offer, you don’t want to look inconsistent or tricksy. The whole point of a pricing model is that it’s consistent across pitches, and changing this too much can lead to a lack of trust in your business.
If you’ve been particularly successful in eking out the pricing models of your competitors, you have the opportunity to include a competitor comparison in your pricing model, to clearly display where your services are less expensive or where you offer more for a similar price. This will work well for businesses for whom you know price point and cost savings are critical decision factors.
If you want to be less upfront about it, and perhaps more tactful, an alternative to displaying the price difference on a rate card is to more casually mention it to potential clients in conversation during pitches. This method is more suited for businesses that you feel wouldn’t appreciate the cutthroat nature of competitor-slamming, and instead want to work with an agency it perceives as caring and supportive.
So it’s important to consider the personality and pain points of your potential client, and choose how, or if, you should communicate your competitive advantage based on this. It’s important to remember that most buyers don’t just want to see a comparatively lower price, they want to be assured they’ll get the same amount of expertise, a better service, added value, and be charged a little less.
On that note, I’d strongly recommend not undercutting the competition to a ridiculous degree just to win business. Hugely reduced prices can end up just giving the impression that your services aren’t of as high a quality as those of your competitors. Remember that buyers want things that are ‘affordable’, ‘inexpensive’, and offer ‘great value’; no-one wants ‘cheap’.
I hope that, while I haven’t supplied a magic bullet for pricing, the above guidance has given you inspiration for how to research and consider your pricing models, particularly at the start of your agency journey.
There are a few common questions I’ve not been able to neatly cover in the structure above, though, so I’ve done my best to answer them below.
Loss leaders, wherein you offer something for free in order to shore up interest and gain work in the long term, are a great way to show commitment and value to your potential clients.
One element of local SEO that’s particularly suited to offering for free at the start of a relationship is a local SEO audit. In fact, performing an automated audit of a business site, using a tool like BrightLocal’s, is a great way to find businesses with local search visibility issues in the first place, and showcase where you can help.
Going one step further, and taking your potential client through the audit for free, is a perfect opportunity to give them an insight into your expertise and make them feel like they’ve got a bit of free consultancy to boot.
A screenshot of BrightLocal’s Local Search Audit tool
Providing your initial local SEO work goes well, you may find opportunities to work with your clients that go beyond your original retainer or project work. The key to getting this right isn’t just to look at what services they’re not buying and try to convince them of a need, but to sit down with them and talk through what’s not quite working that other services can help with.
For example, if your client has plenty of people viewing their Google My Business profile or website, but not enough people becoming customers, you have an issue of conversion. You can then sell conversion rate optimization services off the back of this. Likewise, if their PPC ads aren’t converting, you can upsell them on landing page content improvements.
Ask for a free meeting to look at where the blockers to success are, and use these as opportunities to provide more value with other services, in a way that the client can clearly understand will definitely impact their bottom line for the better.
Firstly, we know that improving local search visibility takes time and effort, no matter the industry. If you simply do a month’s work and move on, your clients will never really see any tangible benefits from your work, preventing you from receiving quality testimonials and reviews, a good reputation, and the potential to grow.
Additionally, there are only so many small businesses in any market, and the quicker you burn through them, the faster you’ll run out! A much more scalable solution is to work with clients on an ongoing basis wherever possible.
This question sadly betrays a fundamental understanding of how citation building fits into the bigger picture of local search success. Asking this question suggests that you’re interested only in scale of citation building, and how many you can get away with selling, rather than quality or impact.
Instead of thinking so granularly, consider citation building a single task at a single price. Rather than saying “we will build citations on X number of sites, and the more the better”, you should be saying “for $X, we will ensure your business is listed and managed on every citation site that is relevant and important for your industry and audience”. This way, you’ll be selling value rather than mere quantity.
Put simply: absolutely not. No-one can possibly guarantee new customers or results in local search every time, even if they can prove they’ve achieved it for previous clients. Every business is its own unique challenge, and you need to manage expectations to accommodate this.
At best, you can provide broad outlines of what results you hope to achieve in a given time, but this is still risky. Instead, sell your potential clients on the ongoing benefit of regular SEO work, and sell based on core, measurable deliverables rather than promising rankings, traffic or sales.
This approach is more likely to lead to a positive relationship with your client and well-managed expectations mean you can underpromise and overdeliver, rather than vice versa.
Do you have any tips you’d like to share about how you build your pricing model? Agree or disagree with any of my points above? We’d love to hear from you in the comments below!