Top 5 Reasons Not to do Post-Pay Billing AdWords in an Agency Setting

By Brian Carter on March 7, 2008 6:51 PM | | Comments (0) | TrackBacks (0)
 
It's less fun than dancing with a moose during mating season. 

Ok, so I've never danced with a moose in heat, but I have it on good authority from Survivorman Les Stroud it's pretty darned dangerous.

So is postpay billing with AdWords.  I know from experience.  Here are my real top five reasons not to do it.

1. It drives accountants batty.  Whether it's your accountants or your clients', you won't be able to explain to them why Google bills how much it does or when they do because like everything else Google does, it's according to a secret magical algorithm.  Here's their explanation of postpay billing amount and frequency.

2. Google bills more than their help explanation says.  The actual limit on how much they bill at one time is usually closer to $599 than the $500 they say, because many of our clients have been billed between $500-600 frequently.  In fact, when one of our clients was spending about $75,000 per month, they were getting billed between $1500 and $3000 a pop, sometimes more than once a day.

3. AmEx hates Google.  Actually, they're just super-fraud-preventive, but it seems like they hate Google.  AmEx frequently declines unexpected charges, and AdWords bills unpredictably, especially if you optimize and suddenly spend more than normal, so unless you want to call AmEx every other day, either don't use AmEx with AdWords or don't do postpay, or both.  (Even prepay with AmEx can require extra an phone call each month from whoever owns the CC, and if that's the client, that means extra communication with them to coordinate this.)

4. Your CC charges and AdWords spend will be out of phase, and this too drives accountants batty.  There may be a balance carried from one month to the next, which complicates billing for clients with a calendar-month-based spend.  You'll have to decide whether you want to bill based on CC charges or AdWords spend.  We feel that spend makes more sense, but then your clients may wonder why the math doesn't add up.  This makes for extra confusion and client communication about these difficult to explain complications.

5. Google has more sane payment options, like prepay, invoicing, or if you're a big enough spender, MDS invoicing.  Most clients I've run into have budget that are defined monthly, often a full year ahead of time.  They expect that budget to be spent and no more.  That's not super compatible with the nature of PPC, which I'll talk about elsewhere, but c'est la vie.  Prepay billing at least ensures you can't overspend- and it's a lot more uncomfortable to tell a client you overspent ("That just shows how well I optimized your account!" doesn't quite cut it.) than explain that you underspent but are working on expanding reach and increasing CTR to get more clicks.  You can spend the remainder next month.

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