4 Things To Consider Before Signing a Contract with a Digital Marketing Agency

by Meghan Kelly

Oct 30, 2018

4 Things To Consider Before You Sign A Contract With A Digital Marketing Agency

Anytime you enter into a new business relationship there is bound to be a contract associated with the partnership. And there should be. A good contract is essential to a strong relationship and helps to ensure that there is no confusion that can lead to hurtful and potentially devastating misunderstandings down the road.

But how do you know what you should look for in an agency agreement? What should be included? What should definitely NOT be included? Follow these tips to help you to get the most out of your contract with your digital agency.

1. Contract Length

The contract should not be for an exceptionally long period of time.

For instance, it’s probably best not to commit to a paid search contract that extends for 12 months. What if paid search just doesn’t work for your business? What if a new competitor enters the marketplace and jacks up your cost per click to a point where it no longer makes sense? Worse yet, what if your relationship with your agency has run its course and you no longer feel that it’s a good fit?

A contract with your digital agency is kinda like a marriage license– that piece of paper should never be the only thing holding a relationship together. Good agencies recognize this and they don’t hold their clients to long-term contracts.

2. Content Ownership

Be sure that you know what you own and what the agency owns.

For instance, your agency might allow you to use proprietary copy and images so long as you are a client of the agency. When you terminate the relationship—the content stays with the agency.

Make sure that you have a good understanding of what belongs to you and what belongs to the agency should you part ways down the road.

3. Investment Increases

Is your monthly investment going to increase when it shouldn’t?

We’ve seen contracts where an agency builds and hosts a website for a client and the agency charges an ongoing monthly fee each time a page is added to the site. That’s ludicrous! It makes sense for the agency to charge to build the page. That takes time and effort. But once the page is built and paid for the cost, the ongoing monthly fee should not increase.

4. Fees vs. Ad Spend

How much of your spend is going to purchase advertising vs. agency fees?

We all know that the cheapest option often isn’t the best option. That goes for agency fees as well. But if part of what you’re paying your agency for is purchasing advertising for you through Google or other publishers—your agency should be straightforward.

You should know how much of your monthly investment is being spent on the publishers and how much of a cut the agency is taking in management fees. It’s also important to understand that not all management fees are created equal.

For instance, some management fees for PPC include the build-out of custom landing pages and call tracking. These are highly valuable services that require time and strategic thought. Business owners should expect that they will require a larger management fee.

Ask your agency how much of your investment is going toward agency fees and ask for a detailed description of what those fees cover.


Have questions about your agency contract?

Would you like a second set of eyes on an agreement before you sign on the dotted line? At Formada, we love to talk marketing!

Reach out for a 30-minute no obligation phone call with our of our friendly client services team members.



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