The most common question we get asked at Credo is “how much does it cost to hire a digital marketing agency?”

According to our digital marketing pricing survey, the overall answer is that the average hourly rate for digital marketers and digital marketing firms worldwide is $148.13 per hour. Using the same dataset, the average hourly rate for US digital marketers/firms is $167.28 and the average hourly rate for UK digital marketers/firms is $111.36.

That survey contains a LOT of data and slices of data to help answer this question across the industry, so we encourage you to check it out in-depth.

But the answer isn’t straightforward because pricing varies based on the marketing channels you are running, the depth of the engagement with your agency, that agency’s brand within the industry, and much more.

Because we still get the pricing question every day, this post will recap those pricing metrics and also help you understand:

  • why pricing varies so much;
  • how to gauge the value of the firm’s proposed pricing;
  • what to negotiate and what not to negotiate;
  • why you should pay market rate for marketing services.

Remember: Credo is not a marketing agency. Credo helps companies find, hire, and work with the best digital marketing firms. If you’re looking to hire a digital marketing firm, contact us here to get started.

Digital marketing agency pricing

Here are the breakdowns of pricing:

Hourly rate by country

Marketing providers overall$112.22
SEO agency worldwide$134.14
SEO agency US$147.93
PPC agency worldwide$136.87
PPC agency US$151.88
Facebook ads worldwide$137.38
Facebook ads US$136.69

Hourly rates by percentage

Worldwide SEO firm single project rates

The average SEO firm charges this much:

  • Marketing providers worldwide from our dataset charge on average $112.22 per hour.
  • SEO providers charge on average $134.99.
  • SEO agencies worldwide charge on average $134.14 per hour (out of 320 survey respondents).
  • SEO agencies in the United States charge on average $147.93 per hour.
  • SEO consultants worldwide charge on average $139.29 according to our data.
  • SEO consultants in the United States charge on average $144.68 per hour according to our data.

Worldwide hourly PPC rates

Here are the highlights of the PPC pricing results, with graphs below:

  • Marketing providers worldwide from our dataset charge on average $112.22 per hour.
  • The average PPC company worldwide charges $136.85 per hour.
  • The average PPC agency worldwide charges $136.87 per hour
  • The average PPC agency in the US charges $151.88 per hour
  • 84.74% of PPC agencies charge between $50-$150/hr

See the challenge with the question about how much it costs to hire a marketing agency? Pricing is all over the place, and for good reason.

Why pricing varies so much

So, why does pricing vary so much and why can’t we establish an industry norm for pricing so that those looking to hire know what to expect and those looking to provide their services know what to charge?

Well, there are quite a few reasons why pricing varies so wildly:

  1. Firm/consultant experience;
  2. Scope of work;
  3. Internal costs;
  4. Industry-specific factors;
  5. And more

Firm/consultant experience

The first factor is experience. I once read somewhere that when you pay for their experience, “you are paying for that person’s past learnings and not for them to learn on the job.”

This applies both to outside providers as well as full-time hires. If you hire someone in-house full-time as an entry-level, you pay them less than a VP/Director because the entry-level person’s skills are less valuable than that senior person’s. You’re paying them for their experience, which is next to none. You’re paying them to learn and provide more value over time. In this case, you’re spending less money but you’re spending time. 

The same happens with an outside firm or consultant. The more specialized the firm is, or the more experience they have in your industry, the more you should expect to pay because they will be more likely to be able to dramatically reduce the amount of time needed to see results.

When you pay for experience, that’s what you get and that’s why it costs more.

Scope of work

Next, is the scope of work. Especially in the digital marketing world, strategy is way underpriced and undervalued. People want to pay for “doing something”, for action. But this is a problem.

If you start walking in the wrong direction, you’re doing something. But you’ll never reach your destination.

Strategy is often billed at a higher hourly rate than “services”, so depending on what the firm specifically provides you may be charged more or less than industry “averages”.

Side note: before you sign a contract you should be crystal clear on if the firm will be providing guidance that you need to then execute internally, or if they will also be implementing the work. We see too many companies coming to Credo who have been burned in the past because their expectations for what their firm would provide did not match up with what the firm did.

Scope of work can (and often does) also mean the number of hours of time you are getting from your firm and the type of work they are doing, as well as the number of channels they are operating.

The more time, the more it will cost.

The more channels, the more time the work takes.

This is why you shouldn’t just look at hourly rates when gauging who to hire. A person with 10 years of experience may have an hourly rate that is 3x higher than someone with 1 year of experience, but if they can do the work 3x faster you pay the same amount for quicker and likely better/more complete work.

Internal agency costs

Another factor affecting pricing is the firm’s individual cost of doing business. In e-commerce we’d call this their COGs (Cost Of Goods), but in the services world, it’s operating costs such as salaries, tools, and more.

If we’re talking about an individual consultant, they usually charge higher prices than an agency because their time is finite. In order to make what they need to make to pay the bills, they have to prioritize who they work with. The most effective consultants are usually those charging the most because this gives them margin in their work to focus on a few clients instead of trying to appease many.

Agencies are slightly different because they are more complex businesses. They have payroll, tools for which they pay (and likely have multiple seats), benefits, office overhead, and more. Smaller agencies are usually comprised of (highly compensated) experts and thus tend to be more expensive than a larger agency, as larger agencies can tap into economies of scale with less experienced employees on accounts.

Industry-specific factors

Another factor that makes it hard to pin down pricing is the specific industry.

For example, travel is an incredibly competitive industry (and becoming even more so every day as Google moves into the search results even more). To even make a dent in competing in this space, you’re going to have to pay big dollars.

Compare this with a much smaller niche, like organic gardening. There are fewer competitors because there’s less money to be made than in travel, and thus the budget required to dominate that industry will be much less.

You can then reason that travel SEO companies will likely charge a lot more per hour, and have bigger engagements, than someone doing content-based SEO or content marketing for an organic gardening publication.

How to gauge the value of the firm’s proposed pricing

When you do the research yourself on firms and receive a lot of proposals, they’re going to be all over the map.

Some are going to be higher than you expected. Others are going to be lower than you expected.

Some will pitch you exactly what you discussed with them and want. Others will use it as a chance to try to upsell you before they’ve even won your business or shown you results.

When considering pricing, we encourage you to not just look at the top line. You should look at what the price will get you.

When considering pricing, we encourage you to not just look at the top line. You should look at what the price will get you.

This may seem obvious, but we know from experience that money is an emotional thing and we respond more negatively to bigger numbers.

But at the end of the day, what you are buying is not “services” but results for your business. A cheaper proposal may cost you less, but at what cost?

Therefore you should take into account, as long as the proposed budget is within your realm of possibility:

  1. What they are proposing to do;
  2. The timeline in which they are proposing to do it;
  3. Results they have shown from previous clients.

All of these are MUCH more important than the cost.

You get what you pay for in life, and this is doubly (or more) true in marketing as well.

What to negotiate and what not to negotiate

Now that you’re looking at proposals and figuring out who to work with, you may have some things you’d like to negotiate back on. But, you may not know what is appropriate to negotiate on and what is not.

In this section, we will talk about what you should and should not negotiate within a proposal.

What to negotiate

When making a decision about who to work with, you still have some power in your hands. Proposals are not a “take it or leave it” sort of situation, and there are definitely areas that you can negotiate (or at least ask questions about for clarification and potential negotiation).

These include:

  • Billing terms and cadence;
  • Delivery dates;
  • Amount of time required per deliverable/audit;
  • Length of engagement.

Let’s talk about each individually.

Billing terms and cadence

Every firm bills in different ways, and sometimes their billing cadence is negotiable. If they say that payment is due before any work begins, you have every right to question this and ask if you can pay on net-30 terms.

They may not negotiate on this, but it is a question that you can ask. Sometimes they may require the first payment upfront but then future invoices are net-30.

Delivery dates

Sometimes dates set for delivery of reports do not align with your own schedule or timing for delivering what you need to others on your team or other vendors responsible for work and their own timelines.

Thus, it is completely acceptable to ask for timelines to be sped up or pushed back to keep to your schedule internally. The agency may not be able to accommodate the request, but you are well within your rights to ask.

Amount of time required per deliverable/audit

Depending on the report to be delivered, the amount of work required to complete it may seem either too high or too low for them to do a good job.

It is reasonable to ask what is involved in a deliverable/report and why it is priced the way it is. The better way to do this, though, is to ask for some examples of similar deliverables they have done and an understanding of what will be delivered to you. Then you can decide if the value is there for you.

Length of engagement

Different firms structure their deals differently and while none is necessarily better or worse for you, you should understand what is being proposed and if that works within your way of working and/or risk tolerance.

It is definitely within your rights to ask if the length of engagement can be shortened (for example, from 12mo to 3mo with an automatic extension). As with the others above, the firm may not negotiate on it in which case you have to decide.

Pro tip: if they require a 12-month contract then you should make sure you have a 30 day out in the contract. If you sign a 6-month contract, build in a 3 month out so that you’re not stuck for 6 months if they’re not great to work with. You need a way to get out of a contract early for no penalty).

What you should not negotiate

There is really one area that you should not try to negotiate, and that is price.

Firms/providers price themselves the way they do for a reason, which is usually because that is what they need to make to cover their business costs and pay themselves so that they are not overworked and can continue driving great results for you.

This said, there is a way to negotiate if the price quoted is too much for you to stomach.

I always tell people “negotiate on scope, not price”. The work proposed to you should be for a certain scope of work (number of hours, set of deliverables, etc).

If for example the cost for 20 hours of work is $4,000 and you only have $3,000 to spend per month, you can negotiate to get 15 hours of work for $3,000.

What this does is allow you to keep within your budget, allow the firm/pro to maintain their needed rate, and everyone is happy. You just need to understand that results may not be seen as quickly because the amount of time the firm has to drive the results has been reduced by 25%.

Why you should pay market rate for marketing services

Finally, let’s cover a point that I think is extremely necessary to understand.

No one wants to pay more than they need to, but in today’s day and age of the internet, we are all bombarded by offers that are so cheap that they seem too good to be true.

First, we’ve all received emails from overseas offering SEO for $99/mo. If it seems to good to be true, especially with something like SEO, then it usually is. You may waste just a small amount of money, but you’ll also waste time and effort and STILL have to go hire someone else.

Second, you need to recognize that if you are able to negotiate down someone on their pricing then you are working against yourself ultimately. You’re working against yourself because you’ve now gone from paying them their normal rate that others pay them and are paying them less. If you were them, who would you prioritize responding to and doing work for? As a business person, you need to prioritize the one paying you more, for the health of your business.

Third, if you pay someone less than they are worth or need then they will have to bring on even more clients in order to sustain their business. This is a net-negative for you because now attention is split amongst more clients than otherwise would have been necessary.

At the end of the day, you don’t want to be a firm’s smallest client. You’ll get less service and probably lower results because of it. It’s better in my opinion and experience to pay a bit more and get the value than to try to squeeze every cent of value out of what you’re paying. Your project will go smoother, your firm/pro will do better work, and you’ll get the results you’re ultimately looking for.