Guide · Pricing
What does a marketing agency cost?
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If you've collected a few quotes for Google Ads or Meta Ads management, you've probably noticed they don't line up. One agency wants a flat monthly fee. Another wants a percentage of whatever you spend on the platforms. A third does both, with a minimum. On paper they all look reasonable, so how do you compare them?
This is an honest look at the two most common models, PPC management fee vs percentage of ad spend, including where each one works, where each one quietly works against you, and how BlackFire prices paid media. We'll also say plainly when our way isn't the right fit.
The two models in plain English
A flat management fee
You pay the agency a fixed monthly amount for the work: strategy, campaign builds, creative, tracking and optimisation. Your ad spend is separate and goes to Google, Meta, LinkedIn or TikTok. If your spend goes up next month, the fee doesn't automatically go up with it. It changes when the scope of work changes, for example adding a new platform or a big creative push.
A percentage of ad spend
The agency's fee is a share of what you spend on the platforms. As we noted in our guide to what a digital marketing agency costs in the UK, this is common for paid media and usually sits at 10 to 20% of your spend, on top of the spend itself. Many agencies that charge this way also set a minimum monthly fee so small accounts are still worth their time.
There are hybrids too, such as a base fee plus a smaller percentage, or a percentage that drops as spend rises. They all borrow the strengths and weaknesses of the two models below.
PPC management fee vs percentage of ad spend: side by side
| Flat management fee | Percentage of ad spend | |
|---|---|---|
| How the fee is set | Scoped to the work involved | A share of platform spend, often 10 to 20% |
| What happens when spend rises | Fee stays the same unless the scope changes | Fee rises automatically |
| What happens when spend falls | Fee stays the same | Fee falls, often to a minimum |
| Budgeting | Predictable monthly cost | Moves with your spend |
| Incentive it creates | Make each pound work harder | Spend more, even if returns don't follow |
| Small budgets | Can look expensive next to a low spend | Often hits a minimum fee anyway |
| Large, scaling budgets | Needs re-scoping as workload grows | Fee grows with workload, which can be fair |
| Best for | Businesses that want spend held to a return | Very large accounts where work genuinely scales with spend |
Neither column is wrong. The question is which incentive you'd rather pay for.
Where a percentage of ad spend works
A percentage model isn't a scam, and it's worth being fair about it. It makes sense when:
- Workload really does grow with spend. A very large ecommerce account running thousands of products across Shopping, Performance Max, Meta catalogue ads and several markets needs more people as it scales. Tying the fee to spend is a rough but workable proxy for that.
- You want the agency's fee to fall in quiet months. If you pull spend back over a slow season, a percentage model usually costs you less (down to any minimum).
- You're already spending heavily and scaling fast. Re-quoting a flat fee every few weeks would be a nuisance for both sides.
If that sounds like your business, a percentage model with a sensible minimum can be a perfectly fair deal.
Where a percentage of ad spend works against you
The problem is the incentive. Under a percentage model, the easiest way for an agency to earn more is for you to spend more. That doesn't mean every agency acts on it, but it does mean the advice "let's increase the budget" pays the person giving it.
A few things to watch for:
- Budget recommendations that aren't tied to results. If spend is going up but your cost per lead or return on ad spend (ROAS) isn't improving, ask why.
- Paying more for the same work. Doubling your daily budget on a campaign that's already built doesn't double the work. Under a percentage model, it can double the fee.
- Fees on top of marked-up media. Some arrangements route ad spend through the agency's own accounts. Make sure you know exactly what goes to the platform and what goes to the agency.
- Losing your accounts. If the ad accounts are owned by the agency, your data and history can walk out of the door with them. Whatever model you choose, insist the accounts are in your name.
Where a flat management fee works against you
To be just as honest about the other side, a flat fee has its own weak spots:
- It can look expensive at low spend. If you only want to spend a few hundred pounds a month on ads, a management fee of around a thousand pounds will feel out of proportion, because it is.
- A fee doesn't guarantee effort. A flat fee removes the incentive to inflate spend, but you still need clear targets and honest reporting to know the work is being done.
- It needs re-scoping as you grow. If you go from one platform to four, the work grows and a fair fee should grow with it. That should be a conversation, not a surprise.
A worked example
These numbers are illustrative only, to show how the maths moves. They are not client figures.
Say a business spends £3,000 a month on Google and Meta. At 15% of spend, the agency fee would be £450 a month, though many percentage-based agencies set a minimum fee above that. Now say the account performs well and the business scales to £10,000 a month. The percentage fee becomes £1,500 a month, even if the campaigns, creative rotation and reporting are much the same as before.
Under a flat fee scoped to the work, scaling from £3,000 to £10,000 of spend on the same platforms wouldn't change the fee on its own. It would change if scaling meant genuinely more work, such as new markets, a new platform or much more creative.
This is also why our cost guide says that below roughly £2,000 a month in ad spend, a flat management fee almost always works out cheaper. The crossover point depends on the percentage, the minimum and how much work your account needs, so run your own quotes through the same sums.
How BlackFire prices paid media
We charge a flat management fee for paid media, from £995 a month plus ad spend, scoped to the work your account needs. Here's what that means in practice, all taken from our paid media service page:
- Our fee and your ad spend are kept separate. The fee pays for strategy, creative, tracking and optimisation. Your ad spend goes directly to Meta, Google, LinkedIn or TikTok, and we never mark it up.
- You keep full ownership of your ad accounts. Your data and history stay with you.
- Every campaign starts from a target. We agree a cost per lead or ROAS target first, and everything else serves that number.
- No channel for the sake of it. You'll never be pushed onto a channel because it's what we sell. If Google is beating Meta for you, that's where the budget goes.
- Plain-English reporting. What you spent, what it returned, and what we're doing next. No vanity dashboards.
Across BlackFire more widely, there are no tiers and no shrink-wrapped retainers. Every engagement is scoped to the problem and quoted to the work, and the people who scope your strategy are the people accountable for delivering it. Ben Metcalfe, our founder, plans and leads every paid media campaign and holds Google, LinkedIn and Meta advertising certifications.
What that looks like in results
A flat fee only matters if the work is judged on what it returns. Two examples from our paid media work:
- Mazuli, a premium glazing specialist, needed qualified leads from architects, contractors and homeowners who didn't know the brand. A paired LinkedIn and Meta lead generation campaign delivered 390K impressions and 241 leads at £7.34 per lead. Read the Mazuli case study.
- Nakanojo, a new Nikkei restaurant on the King's Road, needed awareness and bookings fast. Geo-targeted, photo-led paid social reached 75K+ people and returned 4.7x on ad spend. Read the Nakanojo case study.
In both cases the conversation was about cost per lead and return on spend, not how much budget could be pushed through the accounts.
Who BlackFire's model isn't right for
Honesty cuts both ways, so here's when our flat-fee approach won't suit you:
- Very small ad budgets. Our paid media fee starts at £995 a month. Most clients start with £1,000 to £5,000 a month in ad spend on top. If you want to test with a few hundred pounds, a lower-cost option or a freelancer for one simple campaign will probably serve you better, and we'll tell you so on a first call.
- Very large, fast-scaling accounts that prefer a percentage. If your workload genuinely scales with spend and you'd rather the fee moved with it, a percentage model with a sensible minimum can be fair.
- Businesses with no real ad budget or margin to reinvest. Paid media rewards commitment, not dabbling. If the numbers can't work, we'd rather say so than take the work.
- Anyone judging success on likes and reach alone. We report on leads, sales and return. If you mainly want impressions, we're not the right fit.
How to compare agency quotes
Whichever model you lean towards, ask every agency the same questions:
- What exactly does the fee cover? Strategy, creative, tracking, landing page advice, reporting, or just campaign management?
- Does any of my ad spend pass through your accounts, and is any of it marked up?
- Who owns the ad accounts and the data? It should be you.
- What target are we working to? A cost per lead or ROAS number, agreed before launch.
- What happens to the fee if I increase or cut spend?
- Who actually runs my account day to day?
- What does a report look like? Ask to see an example. If it's all reach and clicks, keep looking.
Then put each quote on a level footing: the total monthly cost at your likely spend now, and at the spend you'd hope to reach in a year. For help setting up the numbers behind those comparisons, see our guides on how to measure marketing ROI, lead quality vs quantity and Meta Ads vs Google Ads. If you're still deciding who should run your ads at all, freelancer vs agency covers that choice.
FAQ
Is a flat fee or a percentage of ad spend better for PPC management?
It depends on your account. A flat fee suits businesses that want predictable costs and want the agency focused on making each pound work harder. A percentage of ad spend can be fair for very large accounts where the workload genuinely grows as spend rises.
What percentage of ad spend do agencies usually charge?
Percentage-based paid media fees commonly sit around 10 to 20% of what you spend on the platforms, on top of the spend itself. Many agencies also set a minimum monthly fee.
Does BlackFire charge a percentage of ad spend?
No. We charge a flat management fee for paid media, from £995 a month plus ad spend, scoped to the work. Your ad spend goes directly to the platforms and we never mark it up.
Who should own my Google Ads and Meta Ads accounts?
You should. Whatever pricing model you choose, keep the ad accounts in your business's name so your data, history and audiences stay with you if you ever change agency. BlackFire clients keep full ownership of their ad accounts.
How much should I spend on ads alongside a management fee?
Most BlackFire paid media clients start with £1,000 to £5,000 a month in ad spend on top of the management fee. The right number depends on your margins, average order value and how fast you want to scale, so it's worth modelling before you commit.
Next step
If you're weighing up PPC management fee vs percentage of ad spend quotes right now, we're happy to look at what you're running and give you a straight view of what's realistic, including if we don't think paid media will pay for you. See how we run paid media, book a 15-minute call or email hello@blackfiremarketing.co.uk.
A straight view of what's realistic
We'll look at what you're running, including if we don't think paid media will pay for you.
Book a callIf you're weighing up PPC management fee vs percentage of ad spend quotes right now, we're happy to look at what you're running and give you a straight view of what's realistic, including if we don't think paid media will pay for you. See how we run paid media, book a 15-minute call or email hello@blackfiremarketing.co.uk.
