Understanding Media Spend and Campaign Management Fees

Media spend is the money that buys the advertising. It goes to the advertising platform and is spent on impressions. A management fee is what you pay for the work: building the campaign, producing the creative, running and optimizing it, and delivering the inquiries.

When those two numbers are shown separately you can see what proportion of your money is actually buying advertising. When they are combined into a single per-lead price, you cannot.

Per lead. You pay a fixed amount per record. Simple to compare on the surface, but media cost and margin are bundled together and invisible. If the vendor gets media cheaper, the saving is theirs rather than yours.

Flat management fee. A fixed monthly or weekly amount regardless of spend. Predictable, and it favours the buyer at higher budgets while being expensive at small ones.

Percentage of spend. The fee is a proportion of media spend, so it scales with the size of the campaign. The buyer sees the media cost directly and any improvement in media efficiency benefits them.

Every pricing model rewards a behavior. Per-lead pricing rewards producing records at the lowest possible cost, which is fine when quality holds and less fine when it does not, because the margin is invisible either way.

Percentage-of-spend pricing rewards keeping the campaign efficient, since the buyer sees cost per lead directly and can act on it. It also means the provider earns more as budgets grow, which is worth understanding rather than hiding.

Neither is inherently honest or dishonest. What matters is whether you can see which one you are in.

Ask what proportion of your payment reaches the advertising platform. Ask whether media is passed through at cost or marked up. Ask what happens to the fee as budget rises, and whether there is a minimum. Then rebuild both offers as an all-in cost per lead using the same assumed media cost, so you are comparing one number against one number.

An offer that cannot answer the first question is not necessarily bad, but you are buying a finished product rather than a managed campaign, and it should be judged on that basis.

For transparency, our Final Expense program uses the percentage model. Advertising spend goes into the ad account at cost, and the management fee is a flat 25% of that spend with a $500 per week minimum. Minimum advertising spend is $1,000 per week, and budgets are weekly, multiplying by the number of weeks you run.

The percentage does not change as budgets rise. Full detail sits on the Final Expense program page.

It depends entirely on budget. A percentage is usually cheaper at small budgets and more expensive at large ones, and a flat fee is the reverse. Work it out at the level you actually intend to spend rather than in principle.

Usually because they sell a finished product rather than a managed campaign, and the media cost is part of their margin. That is a legitimate business model. It just means you are comparing a retail price rather than a cost structure.

Campaign build, creative production, landing pages, ongoing optimization, and delivery of the inquiries. On a well-run campaign the largest ongoing item is creative, because advertising fatigues and has to be replaced on a schedule.