Why Is There A Setup Fee?
Something I often get asked is why there’s a setup fee when you start working with an agency or move from one agency to another. This is especially the case if someone already has an AdWords account set up that’s been running and working for a while.
It’s obvious when it’s a new advertiser that needs to be set up – it makes sense to pay an initial fee to get everything set up and get your campaigns started.
But most agencies will also charge a setup fee when you start working with them, even though you already have campaigns set up. Why is this?
Even when an account is being well run by an agency or freelancer there will always be areas that can be improved. In addition to this, most people who manage accounts have their own preferred way of setting up and structuring campaigns. This means it can be a bit harder to manage a campaign that you didn’t set up in your usual way.
Most new managers’ goal is to improve performance in an account from the start, so what they will want to do is get everything in the account into a structure and format that they are comfortable with, and which they know works well. This also makes it easier for them to manage things moving forward.
As well as this a new manager will need to spend time going through every element of the account checking/editing things like ad extensions, ads, targeting, devices, audiences etc. So, the ‘setup’ fee is as much about checking existing settings to make sure things are done in the best possible way.
Setup fees are usually paid in advance and it varies whether this also includes the first month’s management. It’s well worth checking when you’re looking to work with someone what the timeframe is between the setup fee and the first management fee. Will the setup be done quickly, or will it take a month? You might get a surprise if you receive an invoice for the management fee a week after you paid the setup fee (which, by the way, is usually a lot higher than the ongoing monthly fee).