Performance-based SEO simply means, you get paid inline with the results that you achieve. So if you do great, you get paid. If you don’t then, well, you probably won’t. Performance based SEO is usually offered as an incentive to attract clients, however the incentive is often dishonest, misleading and deceitful.
Unlike traditional SEO that is typically billed at a flat monthly rate, performance based is a little different.
Here’s a quick example of how an SEO agency might promote performance based SEO….
“Hey, work with us, you don’t need to pay anything until we get you first page in Google”.
Whilst that might seem attractive to most business owners, what they fail to tell you is – first page for what?
Most times they’ll argue the point that they’ve done their job and demand payment, regardless of the fact that the keywords that are on first page are absolutely worthless. This shit is pretty common in the SEO space and when I speak with business owners signing up for it, all I can do is shake my head.
How a good friend of mine handled this request
Before we go any further, I want to share with you an email that was sent to me recently from a friend of mine that does what I do – he runs his own SEO business, and he acquired a new lead who was asking about “performance based SEO”.
Here it is.
Just wondering whether you were open to negotiate a little on price. I was wondering whether I could pay $1,800 per month instead of your quoted $2,250 per month for the 1st 3 months and if I was to engage (sign-up) 2 new clients directly as result of the work you had completed on my site I would make a bonus payment of $1,350 (450 x 3) at the end of the 3rd month.
Now, here’s the reply given…
In terms of pricing, we don’t typically offer discounts or sales performance incentives. The reason for that is not because we don’t believe we’ll get results, I know that we will get results granted we have enough time to spend on your campaign given your level of competition.
As for performance based incentives, the main issue I have is that all I can do is send you leads to your business. I don’t have any control over the sales conversation or your close rate. While 2 new customers should be an easy gig, and I think we’ll get that pretty early, it’s still something that is out of our control.
You might think this is crazy, but we’ve had some customers tell us they haven’t received any new customers only to discuss each specific lead generated and have them admit they haven’t been checking their emails or answering calls because they were too busy.
Here’s someone offering a “bonus payment” if they sign up 2 new clients.
That’s like walking into a restaurant and offering a third of what the meal costs, and telling the waiter “Listen, If I enjoy the meal, I’ll pay for it, and give you a tip.”
I think the way my friend handled this was nicely done. It was essentially a polite and professional way of saying “Fuck off.”
The biggest problems with performance based SEO
Performance based SEO is one of those topics that comes up occasionally and as usual within any SEO community it ends in a fist fight.
Many SEO’s are against the idea. Some are all for it.
Myself personally, I’ve never understood why, because it just never works. Infact I don’t know of anyone that works in the SEO space that uses this payment model successfully. I have seen however, quite a few SEO’s try it, and every time they’ve come back saying “Christ, ….never again.”
So before you start rubbing your hands together thinking about offering performance based SEO, and how wonderful it’s going to be – read this list below.
These are the main reasons why I think performance based SEO sucks balls.
You have no control over the clients ability to close
This is probably the biggest reason for me.
You have no control at the other end once you send those leads over to your client. You could be doing the world’s greatest SEO, sending a shit load of leads to your client, and their close rates might be fucking terrible. I worked with a client a number of years ago and he was closing 30 out of 400 leads a month – 30! The guy was absolutely useless. That’s 7.5%. Could you imagine if I was being paid on a performance basis?
It would’ve been completely pointless.
I’ve seen clients that have the wrong people, the product sucks, nobody wants the service, the price is wrong, its a mess.
This is where the client starts blaming you for sending shit quality leads. Which brings me to my next point.
Clients complaining about lead quality
As mentioned above, this is where performance based SEO falls short.
Let’s say you’ve sent 500 customer enquiries through to your clients site. At the end of the month, you jump on a call to discuss campaign performance and calculate the profits. The client says “Sorry, but these leads have been shit, we’re not paying you.”
So you’ve increased organic search traffic, you’ve increased the number of customer enquiries – yet it’s not enough, simply because the client says the leads were shit.
What the hell do you do then?
Unless you have access to the clients sales data, this could get really fucking messy, and it’s a situation that I’m just not interested in getting myself into.
Especially when it becomes their word against yours.
Some businesses are just fucking broken
Over the years I’ve learned the how critical it is to prequalify and onboard correctly.
I understand the importance of asking the right questions to ensure I’m engaging with a client who has their shit together, and they’re not running a broken business. That can usually be easy to spot, but let me tell you – there are a LOT of businesses owners around that are fucking clueless, and the thought of partnering up and getting paid on a performance basis isn’t something that interests me at all.
Some businesses are so far gone that improved rankings, more traffic and customer enquiries won’t make any difference.
All you’re likely to do here is inherit their problems and end up on the phone listening to them blame you, Google, the guy across the road, the Government or Jesus.
The client doesn’t have an efficient sales process
This ties in my first two points.
Clients that don’t have proper sales processes.
One thing that I’ve made mandatory as part of my onboarding process is to ensure prospects have a sales process. I ask a series of questions around customer journey from initial enquiry right through to the transaction taking place along with what happens at each touch point. I also ask about CRM’s, tracking and communications, because I want to know they have systems in place that actually convert enquiries to sales.
It’s amazing to me how many businesses don’t have those systems in place.
Even though they’ll tell you they do.
I worked with a businesses once doing $2M a year that had one girl answering the phone, who was closing 10% of the enquiries that came through, simply because she didn’t give a shit. Infact, in some instances she was sending customers to their competitor! It wasn’t until the client implemented call tracking, that we identified the issue and fixed it.
If this campaign was based upon performance then it would’ve been a struggle and probably fell apart before we were able to identify the actual problem.
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Another thing that would be a concern for me would be dishonest clients.
Clients that purposely fudge the numbers in order to decrease earnings, sales and revenue in an effort to reduce your portion of the income. You might be surprised but I’ve worked with a number of clients over the years that have “forgotten” that I can see all the data at my end.
Calls, sales, customer enquiries, emails, the lot.
Yet, they’ll pull some bullshit via email …..”Things have been really quite this week John, no enquiries at all.”
What about the 6 missed calls this morning, and the 20 email enquiries I can see in the dashboard?????
Again, I’m not real keen on having to tell someone they’re lying just to get what they’ve agreed to.
Some businesses are seasonal
I’ve worked with a number of businesses over the years that are seasonal in nature.
That is, business slows down quite a lot when things get hot, get cold, or its holiday season for example. What am I supposed to do then? Get paid less?
I couldn’t think of anything worse than putting in an enormous effort then having a client say ..”Sorry John, this month we won’t be paying you what we do normally because our customers aren’t buying for the next few months.”
Some clients are shit at following up
I once had a discussion with a client that complained about getting too many calls. I’m not kidding. He said “John can we slow it down a bit, honestly I can’t spend all day on my phone. I’ve had to just let the phone ring out the last few days because I just don’t have time”. I also recall a friend who also provides SEO had a client that said “Emails? Sorry I don’t bother checking emails – I only want calls”
I’m not joking.
This client had ignored emails for weeks because he didn’t want to have to log in and check customer enquiries. It was too hard.
Could you imagine if you’d entered in to a pay per performance agreement here?
Arguing the outcome
The way in which “performance” is defined, can be subjective – especially when there’s money involved. I’ve seen and heard it all when it comes to performance based SEO. Sure you could cover your ass with a contract, but even then that might not be enough.
This is where I’ve seen SEO consultants get dragged into a shit fight over the way “performance” is defined and end up in a position that leaves them without much choice but to abandon the campaign altogether.
Here’s a few one liners I’ve heard –
- “Yeah we can see you’ve improved our rankings but the phones not ringing and we’re not selling anything so we don’t think we should have to pay”
- “Those rankings you got us have tanked, so we’re going to cancel any further payments and expect you to continue working for free”
- “Some rankings are up, but others are down, so we’re not going to pay”
- “We’ve lost our rankings, we’d like a refund”
- “Sure traffics gone up, but we’ve not noticed an increase in customers, we’re not paying”
- “The traffic has increased but so have our bounce rates, the traffic is garbage, we don’t believe we should pay”
- “The traffic has increased because we’ve started using Adwords, we’re not paying”
- “The product/service isn’t one you’ve been helping us with, so it doesn’t matter. We’re not paying”
- “Sorry we forgot to mention that sales made today don’t clear at our end for 6 months, we have a long sales cycle. We’ll pay you then”
- “We’ve had a number of refunds come through so we’ll have to either request that payment back or stop next months payment”
- “We don’t have time to check email, we want phone calls only, not paying”
Can you see how fucking messy this shit can get???
I don’t know about you, but I just want to get paid.
Not deal with this sort of nonsense.
I just want to get paid
When it comes to providing SEO services, I just want to get paid.
I don’t want to have to deal with back and forth bullshit.
Just let me do my job, pay me and we can both be happy. You do whatever it is you need to do to run your business, I’ll do likewise.
The thought of getting caught up in someone else’s mess seems far too stressful.
I’m not here to help save your business. I’m not here to help you improve your sales calls. I’m not here to provide business coaching. I’m not here to train your staff.
I’ve been hired to help you with SEO.
That’s what I do.
Just pay the invoice and leave me out of it.
Is that the right attitude? Could I be wrong?
I once spoke with a business mentor who said “If you’ve helped a client move from $30,000 a month to $900,000 a month, and they’re still paying you what they were when you first started then there’s something wrong with that”. Essentially what he was saying is that you should be paid inline with the outcome, or there should be some form of reward for your efforts. I also recently heard John Logar say “If you’re providing a marketing service and you’re simply sending clients leads and doing nothing else once they have them, then you’re only doing half your job”
Whilst I get what he’s saying, I think that’s a real deep conversation to have and might save that for another blog post.
It almost gets to a point of well….where does my responsibility end?
Should a fireman that saves someone from a house fire also drive the ambulance and perform surgery back at the Hospital?
This becomes a sensitive subject and one that I’m sure might start a pub brawl.
But it’s certainly an interesting thought.
In some ways this starts touching on different ways to charge for SEO, which is a very deep and dark hole that I don’t want to go down in this post, but I think there may be some merit to it.
I think the biggest issues are still the ones I mentioned above, which are enough for me to steer clear of it.
So yes or no for performance based SEO?
I still think performance based SEO sucks balls, but I’d be willing to jump on a call or host an interview with someone that has managed to make it work. I’m not sure I can be convinced, but I’d certainly listen and hear out other points of view. If you’ve been caught up in a messy performance based campaign then I’d love to hear your experience below. Likewise, if you’ve had a great experience then post it below and let us all know how you made it work.
Go on, post up your thoughts below.
I respond to all comments, unless I’m busy watching cartoons.