Starting an Adwords Agency requires, next to a good set of brains and a macbook pro, a good software toolkit.

Here’s ten of the most used tools we can advise:

1. Google Apps for business  is a nice suite with which you can manage email, docs, calendar and other office tasks. No need to install anything, up and running in minutes.

2. The Adwords Editor is a tool from Google to easily manage campaigns, copy / paste ad groups and work on your campaigns offline.

3. Of course we cannot leave out Swydo. Task management and easy reporting for agencies. Track tasks, use Google docs and integrate with Google Calendar and easily report on Adwords, Analytics and webmaster tools.

4. Most agencies bill in a recurring fashion. You need a profesional billing app, like fresh books.

5. For keyword research use Google insights for search.

6. Track conversions not only via the Adwords conversion script, but always, if possible, connect the adwords account with the analytics account.

7. Get inspired through Google Agency Edge.

8. Use tools provided by Google in the Agency toolkit.

9. Be innovative. Know more and know it sooner than your clients. Follow Google Ad innovations.

10. Have some fun and some music. Tune in on Spotify and start creating those ads.

On Mediapost I read an interesting post and reactions on what and how to charge for online marketing services. The article you can read here.  The author, Mark Simon, makes the comparison with a home construction project and thinks it is not wise to charge more, when the Ad spend of client increases. He seems to think that the amount of work for a larger media budget is the same as for a smaller media budget. Also a pay for performance deal is not his choice, because he thinks the client has no advantages in such a deal (without further explaining this point of view). Mark seems to be an advocate of a monthly fixed fee.

I think that clients not only pay their agency for time, but also, and maybe mainly for knowledge and experience. When you see an agency as a contractor, you see the job as a predefined effort that requires a standard skill set. And this goes well for plumbing and other work, but online marketing also requires other skills that cannot be measured in hours. I’m talking about creativity, experience, holistic approaches, empathy etc.

So the reward for an agency should also be a combination of a compensation for the time spend by professionals and a reward for the creativity and experience. That’s why a retainer, covering the labour costs with a surplus, in combination with some sort of performance fee is not a bad idea. Since the relationship beween client and agency is lasting several months or even years, you can expect an appraisal that is honest and stimulating. Several options are possible: percentage of sales, fee per lead, or why not just evaluate together every 3 months and score mediocre, good , super?

Swydo offers several way to manage this. You can track time, see how much effort a consultant did take for a client and even you can define KPI’s that measure online success.

Every high school drop out with some coding skills has a couple of options: Build websites for ‘your uncle that has it’s own business’ or start your own online marketing agency. The profession has, to say in Porter terms ‘low entrance barriers’. The other forces of the 5 forces are not that positive as well. The bargaining power of suppliers, e.g. Google, is high, the bargaining power of Buyers, your customers, seems also high and the threat of substitutions, for instance Inhouse marketers, is also high. Ready to kill yourself? Don’t! There’s a way out.

You can move yourself in a position that eliminates these forces to a large extend. You can implement another concept of Porter: that of the differentiation strategy. Focus on a specific market segment, for instance B2B or even Technology, or travel or recruitment. When you do that you can specialize in the specific do’s and dont’s of that specific industry. You can train your staff in best practices, develop tools to support your business processes and reach economies of scale and scope. And suddenly your agency is unique, has a reputation and positions itself above online “PPC management” and cannot be substituted by a college dropout.