Digital Advertisers Pricing

[uditg]

Hello!

I am looking for a Digital Advertising Solution provider for US region for a group of 20 dealers, also i am seeking some help on how these people charge a dealer for the services rendered.

In particular the providers I am looking at are Dealer.com and C4 analytics.

 

[anthonycapital]

PM sent

 

[craigh]

Typically, you're going to run into 2 billing models:
- fixed management fee
OR
- % of advertising spend

The reason I always avoid % of advertising spend is that it gives the vendor an extra reason to convince you to possibly overspend.
Many times I've taken over contracts for services like AdWords, reduced the spend by 50% and seen better results because the last vendor kept increasing monthly and quarterly to increase their profit %.

 

[Lee E Kincaid]

It's also important to note that some vendors charge as much as 39% for the management fee.

*Full disclosure I work for DDC.

 

[craigh]

It's also important to note that some vendors charge as much as 39% for the management fee.

*Full disclosure I work for DDC.

I've seen Reach Local do 50% without batting an eye.
They call it "variable".

 

[uditg]

It's also important to note that some vendors charge as much as 39% for the management fee.

*Full disclosure I work for DDC.

Don't you think the percentages you are quoting are quiet high?
What i have been experiencing from past one month's research, ranges from somewhere around 12%-20% of the total digital ad spend by a dealer.

 

[uditg]

I've seen Reach Local do 50% without batting an eye.
They call it "variable".

Are you talking about the advertisement reach?

 

[craigh]

Are you talking about the advertisement reach?

No. I'm talking about a store that had a $4000 budget and paid $2000 in admin fees.
They also spent 70% of the $2000 buying the store name for outrageous prices.
On top of that, all their reporting obscures the CPC so it's harder to find this out.
Not to mention the fact that they get aggressive kick backs from Google, meaning they're grossing huge $$$

Most vendors are great, but some are awful. Thankfully most dealers have found an Automotive provider.

 

[Lee E Kincaid]

Don't you think the percentages you are quoting are quiet high?
What i have been experiencing from past one month's research, ranges from somewhere around 12%-20% of the total digital ad spend by a dealer.

You are correct with your averages. My comment was more a warning that some providers standard fees can be double the average. There is one large provided (Not DDC) that runs at 39% that I know of personally. As Craigh mentioned he has seen rates even higher.

 

[uditg]

You are correct with your averages. My comment was more a warning that some providers standard fees can be double the average. There is one large provided that runs at 39% that I know of personally. As Craigh mentioned he has seen rates even higher.

Then what do you think that, what is differentiating one vendor from other, if its not pricing?