You want the best deal you can get. After all, if you can get something cheaper somewhere else, wouldn’t you? I understand. There’s very few times when I buy a product, either online or in a store, that I don’t look for the best price. I mean, if I’m buying the latest gadget (I’m interested in the new Amazon fireTV, if you are interested in getting me a gift), I’m looking for the best price. I’ve got four kids, so we clip coupons and look for the best price. But being frugal and being cheap aren’t the same thing.
The Cost of Being Cheap
There are certain things I don’t skimp on. When I was a single guy living on a newspaper reporter’s salary, I learned some hard lessons about being cheap. Every week, my roommate (who is still one of the cheapest guys I know) and I would go grocery shopping. We were both poor, so we price shopped. We bought generic EVERYTHING. That taught me that sometimes it’s best to pay for the real thing. I still can’t look at generic “pop-tarts” without getting a metallic taste in my mouth. We’d buy this food, and some of it was so bad that we wouldn’t eat it. It went to waste, and we really couldn’t afford to let that food go to waste. The cost ended up being the price of the generic pop-tarts, plus the trip to the store to buy the real thing.
Of course, Pop Tarts and marketing aren’t the same thing. When you trust someone to help you with your marketing, you have way more to lose than a $3 box of carbohydrates. And in search engine marketing, being cheap can be catastrophic.
Let me cut to the chase. When you skimp on your SEO and SEM, you risk losing the effectiveness of your site completely. Things have changed dramatically over the last year and a half. Cheap SEO is not only ineffective, in many cases it can damage your brand and your site. When you buy cheap SEO, you are not being frugal – you’re not buying the same product for a lower price. You’re buying a worse product at a lower price.
In some cases, there have been companies that have had to abandon their entire site and the domain name it is associated with because they chose the cheap-SEO route. In other words, they lost everything because they wouldn’t pay for a competent search engine optimization company.
One of the fastest-growing segments in the SEO industry is penalty recovery. You hear that? I hate to be a fearmonger – but this is happening every day. A lot of SEOs are now working to help people who have been penalized by Google for what they themselves were doing not more than two years ago. And, these penalties were sometimes caused by the advice of some of the most famous names in the SEO world. No one is immune to what Google is penalizing, now. The rules have changed.
If you don’t have a competent SEO, you may not even realize you are being penalized. You might just think that “SEO doesn’t work.” I’m here to tell you that SEO does work – when done right – but SEO isn’t even the same discipline it used to be. If your SEO hasn’t adapted, it’s probably hurting you. That means moving your site backwards in search, not just staying the same or not gathering traction – actually doing worse.
If your SEO is charging you significantly less than other firms, I’m going to say there is a high probability they are hurting you and not helping you. If your firm outsources anything to people in a developing country, particularly content creation, you are very likely in trouble.
SEO: The Cost of Goods Sold
Let’s do a little math – I promise it won’t be too painful. Below is a table listing the average salaries of SEOs of different experience levels, according to the 2013 salary survey conducted by the Search Engine Marketing Professional Organization (SEMPO). Full disclosure, I am a member of the SEMPO Global Board of Directors, but this is the best data out there, so I’d use it even if I wasn’t. Now mind you, this is aggregated data from around the world. In actuality, our salary levels are lower than this – but for simplicity purposes I don’t want to disclose our salary ranges, so we’ll use the SEMPO data.
Average SEO Salary
(1-3 years experience)
Average SEO Salary
(5-7 years experience)
Average SEO Salary
(7-10 years experience)
Average SEO Salary
(10-15 years experience)
At our firm, we love to bill clients to a retainer based on deliverables. But, at the end of the day, the only thing SEO agencies have to sell is time. So, when we do bill based on deliverables, the retainer is always based upon our experience in how much time it will take to deliver what the client is promised.
For our most basic program – and I’ll tell you after 15 years in this space, this is the most basic I can consciously sell someone and sleep at night – we estimate that the minimum deliverables will require an estimated 30 man hours per month. And no, I’m not going to share that deliverables list unless you are a potential client. That hourly figure is usually after the first month, in which many more hours are typically spent on audits and campaign strategy and set up.
In my experience, if you put in less time, you might as well just throw the money away – because you won’t get anything out of it. Now there are always exceptions to the rule, and some simple sites in non-competitive areas can get away with fewer hours. But, the average site truly requires 30 hours or more of SEO love per month to increase rankings and see an ROI of 3 times net what you’re spending. I believe all advertising should deliver 3 times net over time – or else there is no purpose in doing the advertising.
So, we’ve seen the salaries and we’ve talked about the time it takes to put together a quality program. I know that there are ways that people can cut down the hours it takes to produce a profitable program, but 30 hours is pretty standard for each client.
Let’s say that the average SEO has around 30 hours per week to dedicate to actually working directly on SEO. The rest of their time is spent researching what’s going on with Google, administrative tasks, and personal promotion. That means, for most months, they’ve got 120 hours of actual time to work on sites.
If an SEO firm is charging $500 a month for their services and putting in the time that it takes to be effective (30 hours per client), each SEO at the firm has the capacity to serve 4 clients at a time and they’ll make around $24,000/year. If they work an 8 hour day, that averages out to $12.50 per hour.
That’s decent money for an intern – and I’ve even argued it is OK for an entry-level SEO. But, if you want someone with valuable experience, you’re not going to get them for $12.50 an hour. At least not in the U.S. Sure, there are some people who can work faster than others – but they’re definitely making more than $12.50 an hour if they are good. Even if they cut the deliverables time in half, they aren’t making what they are worth at $500 per month per client. They’re not even getting enough at $1,000-$3,000/month. If they are any good, someone will pay them more than that. Just look at the table of salaries above.
So, the bottom line is, if you are shopping SEO on price, you’re costing yourself money. Think about what it would cost you to hire someone (or several someones) full-time, on your staff, to do the work. Then, think about spending that money with an agency like ours – where you will get multiple strategists and specialists using their expert skills on your content, code, links, and social profiles – for the same money or maybe less. Clearly, the low-cost SEO program either doesn’t provide adequate deliverables to show an effective return, or someone is working for an incredibly low wage. Low wage earners typically aren’t who you want running one of your most important marketing channels.
If you want to spend $500 a month with no return, I know of some really great steak restaurants that we can go to, and at least get a full belly and a fun night out of your money. Call me and we’ll go eat.
If you have an SEO horror story to tell, related to this issue, tell us in the comments and maybe we can help – let’s not “name names,” please. We’re not here to publicly shame agencies, but we would like to educate companies about the right way to approach online marketing of all sorts. Of course, if you understand and like our approach, you can contact us via the contact form on our home page and we’ll talk to you about our handcrafted approach to digital marketing.