Strategy
How agencies charge for Google Ads management
Percentage of spend, flat fee, and hourly are the three common models. Here's how each one changes an agency's incentives.
Percentage-of-spend pricing scales naturally with account size but can subtly reward higher spend over efficiency. Flat monthly fees remove that tension entirely, aligning the agency's incentive with getting results rather than growing the budget. Hourly billing is rare in this space because effort doesn't always match value delivered.
Why percentage-of-spend has a built-in tension
If an agency earns more when a client spends more, there's a quiet incentive, even if unintentional, to recommend budget increases before they're clearly justified by results. This doesn't mean every percentage-based agency behaves this way, but it's a structural tension worth being aware of and asking direct questions about.
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