---
title: "Internal Memo: How to Raise Agency Revenue When Client Revenue Stalls"
description: "A fictional percentage-of-spend agency trains account managers to raise budgets, report clicks, and defend the fee clause that rewards both."
url: "https://groas.com/post/how-to-grow-your-agency-revenue-without"
image: "https://pub-87da24ecbbfc4c3bad6875f3aa013712.r2.dev/generated-images/939784a2-b0d0-4c08-adee-1da6cbd3aad4.png"
published: "2026-10-11T05:19:20.813Z"
modified: "2026-10-11T05:19:20.874Z"
---

October 11, 2026 · 10 min read

# Internal Memo: How to Raise Agency Revenue When Client Revenue Stalls

[Alexander PerelmanHead Of Product @ groas](https://groas.com/author/alexander-perelman)[LinkedIn](https://www.linkedin.com/in/alexander-433793253/)

![Cartoon of an agency rep offering a bigger hose, metered into his briefcase, to a client holding a leaking bucket: more spend, more fee, same leaks.](https://pub-87da24ecbbfc4c3bad6875f3aa013712.r2.dev/generated-images/939784a2-b0d0-4c08-adee-1da6cbd3aad4.png)

## MEMO: Q3 Revenue Growth Initiatives (Confidential, Do Not Forward to Clients)

**TO:** All Account Managers\
**FROM:** Revenue Operations\
**RE:** How we grow this quarter

Team, client results were flat in Q2. Our revenue was not. That is the system working as designed, and this memo explains how to keep it working in Q3.

First principle for new starters: **we earn 15% of what the client spends, not a share of what the client makes.** Read that twice. Your portfolio grows when budgets grow. Budgets grow when you recommend growth. So recommend it.

This document covers the recommendation, the report that supports it, and the language to use when a client asks whether any of this produced a customer. Keep a copy for internal training. Do not attach it to a QBR invitation.

### Initiative 1: Recommend the budget increase before anyone asks about CPA

Percentage-of-spend fees commonly run [10 to 20% of spend, with 15% as our house example](https://blog.applabx.com/google-ads-management-pricing-how-much-does-it-cost-in-2026/). That makes the math beautifully simple. A client spending $20,000 a month pays us $3,000. The same client spending $50,000 pays us $7,500. The account did not get 150% harder to run. Our invoice got 150% larger.

This is why every QBR deck must contain a slide titled _Unlocking Growth Through Increased Investment_. Put it before the slide showing cost per acquisition, if that slide exists.

![A confidential internal memo beside charts of rising budgets and flat sales.](https://pub-87da24ecbbfc4c3bad6875f3aa013712.r2.dev/generated-images/ade2205f-3f18-45b7-a060-b0a086286cd4.png)

Never lead with a budget cut, a reallocation, or a pause. Those reduce revenue. Ours. If CPA rose after the last increase, recommend more budget to give the algorithm more data. If the client asks what extra spend buys, say _scale and presence_. If they ask when it pays back, say we are still collecting data.

A client may point out that the higher fee buys the same reporting cadence and, often, the same campaigns with higher caps. Acknowledge the question. Then return to the slide. The recommended next step is increased investment; do not let the fee calculation become the recommended next step.

**Account-manager takeaway:** a budget recommendation is also a fee recommendation. Keep the first phrase visible and the second one quiet.

### Initiative 2: Put impressions on page one and customers somewhere else

Page one of the monthly report will show **impressions, clicks, click-through rate, and average CPC**. Page four may mention conversions, briefly, without cost per conversion. One buyer checklist warns that [a report led by impressions and clicks rather than conversions, cost per conversion, or ROAS relies on vanity metrics](https://www.saashero.net/google-ppc/devtech-ppc-agency-complaints/). We agree with the diagnosis and recommend the disease.

A client who sees 41,000 impressions feels served. A client who sees $212 per qualified opportunity feels curious. Curiosity creates questions. Questions create work. Place the chart with the largest upward slope near the executive summary, and keep the definition of a conversion for a later conversation.

Where possible, optimize toward raw form fills. A form fill is cheap, plentiful, and photographable in a chart. A qualified buyer is expensive, rare, and asks follow-up questions. [Optimizing to form fills trains bidding to find form-fillers, not buyers](https://www.saashero.net/google-ppc/devtech-ppc-agency-complaints/). For our purposes, the resulting volume makes a reliable headline even when sales does not call those leads back.

If the client asks whether the form fills became customers, thank them for bringing the sales perspective into the discussion. Record the question under _cross-functional alignment_. Do not move it to page one of next month’s report.

**Account-manager takeaway:** report the activity the account produces before the outcome the business needs.

### Initiative 3: Treat the learning phase as a renewable resource

A [Smart Bidding learning phase typically lasts 1 to 4 weeks and can bring inconsistent ROAS and elevated CPA](https://jetfuel.agency/google-ads-ecommerce-guide-2026/). A major change can send the account back into learning. This gives us a useful response whenever a client asks why this month looks like last month, only more expensive.

Change the budget sharply, restructure the campaigns, or toggle the bid strategy, and there may be another stretch of results we can describe as too early to judge. Learning cannot be judged. Learning cannot be cut. Learning renews like a magazine subscription, provided we keep making changes that disturb it.

Do not call this _the same explanation again_. Call it _a new learning period_. The distinction is important to the monthly narrative, even if the client’s CPA fails to appreciate it.

**Account-manager takeaway:** when the question is whether performance improved, begin with why it cannot yet be assessed.

### Initiative 4: Hold the strategic call; prepare the Change History

Schedule a 45-minute call every month. Bring three slides and zero account changes. Talk about the market, seasonality, and the competitive landscape. Nod seriously when the client mentions cost per acquisition. Promise to monitor it closely. Monitoring is free and creates no Change History.

There is one risk. In [a buyer’s account of an $800-a-month fee, Change History showed zero campaign work across 90 days](https://www.clairejarrett.com/800-a-month-0-changes-in-90-days-the-screen-that-proves-it/), only billing entries. The account had one conversion in 30 days on Maximize Conversions. Clients can open the same screen without asking us for a custom report.

Prevent this by making at least one visible edit before each call. Adjust a single ad schedule by 15 minutes. Pause one keyword with $4 of spend. Log it as _ongoing optimization_. History will show activity. Activity is indistinguishable from management to anyone not looking closely.

Should a client look closely, return to the distinction between _strategic oversight_ and _tactical changes_. Do not volunteer how many minutes the tactical change took. There are still 45 minutes to fill on the call.

**Account-manager takeaway:** if the conversation turns to work performed, have a visible change and a long explanation ready.

### Initiative 5: Never define “qualified” in writing

Under no circumstances write down what a qualified lead is. Once it is written down, it can be counted. Once it is counted, cost per qualified opportunity can be calculated. Once that number exists, someone may compare it with our fee.

Keep the goal as _leads_. Leads can rise when spend rises, which brings us back to Initiative 1. If sales says the leads do not close, express sympathy and recommend a landing page test. Tests take six weeks. Six weeks is two more invoices.

The qualification discussion also threatens the report. A client who agrees on what counts as an opportunity may ask for that number beside spend, or worse, on page one. A client who never gets a definition can keep debating lead quality with sales while we present another chart of form fills.

**Account-manager takeaway:** a vague goal is harder to miss and easier to renew.

### Appendix A: Approved phrases for client calls

Use these when a plain description would invite a follow-up question:

- **Synergy:** two people doing the same job. Usage: “Our paid and organic efforts are building synergy this quarter.”
- **Full-funnel:** we looked at the account for ten minutes and changed nothing. Usage: “We are taking a full-funnel view before making any reactive changes.”
- **Unlocking growth:** raising the client’s budget. Usage: “To unlock growth, we recommend moving to $35,000 in September.” See Initiative 1.

Use one phrase at a time. If all three appear on the same slide, a client may start asking what we actually did.

![An agency report with large impressions and clicks figures above a small revenue figure.](https://pub-87da24ecbbfc4c3bad6875f3aa013712.r2.dev/generated-images/8976c98d-5431-443c-acbc-af4d83436c60.png)

### Appendix B: Defend our fee against the alternatives

Buyers are reading pricing comparisons. Some will arrive at the next call knowing that [percentage-of-spend fees rise with budgets, not with CPA or profit](https://torro.io/blog/why-most-ppc-agencies-focus-on-spend-not-profit/). One UK agency even says it [does not charge a percentage of spend because the agency earns more when the client spends more, whether or not the extra spend helps](https://www.revuponline.co.uk/ppc/). Prepare for the objection. Do not assume a well-designed QBR deck will make it disappear.

**Percentage of spend: defend the simplicity, not the incentive.** Pricing guides put this model at [10 to 20% of monthly spend, often with $500 to $1,500 minimums](https://blog.applabx.com/google-ads-management-pricing-how-much-does-it-cost-in-2026/). At our 15% rate, a $20,000 monthly budget produces a $3,000 fee. At $50,000, it produces $7,500. The tracking and reporting cadence need not change. The contract does not require CPA to fall or pipeline to grow before our fee increases.

If a buyer brings the [comparison of percentage-of-spend and flat monthly fees](https://groas.com/post/percentage-of-spend-vs-flat-monthly-fee), ask which model they feel offers the most support. Avoid calculating the dollar difference at their proposed higher budget. That calculation is easy, and it is not helpful to us.

**Flat retainer: concede the spend incentive and move to workload.** Flat retainers for SMB and mid-market accounts cluster at [$500 to $5,000 a month](https://clicksgeek.com/google-ads-management-pricing/), with broader surveys extending to $1,500 to $10,000. A [tier breakdown](https://clicksgeek.com/google-ads-management-pricing/) describes $300 to $750 as templated work with infrequent optimization, $750 to $2,000 as weekly optimization, and $2,000 to $5,000 as full-funnel work involving landing pages and CRM integration.

This spread gives us room to discuss service hours. A $1,200 retainer and a $4,500 retainer can both be called _full management_, though the second allows more time for tracking, creative tests, and search-term work. Do not, however, dispute the buyer’s central point: under a flat fee, a budget increase does not automatically give the agency a raise. Move instead to accountability. A flat-fee agency still gets paid if CPA rises, pipeline stalls, or the only account change in 30 days is a bid tweak nobody can explain. Flat removes our particular conflict; it does not, by itself, guarantee useful work.

**Performance pricing: ask who decides what counts.** [Performance-based pricing is rarer than flat or percentage-of-spend pricing](https://hawksem.com/blog/ppc-management-price/). It may take the form of pay per lead, pay per sale, a CPA bonus, or revenue share. Buyers attracted to pure performance fees may discover that the argument has simply moved from the invoice amount to the definition of a conversion. A billed form fill is not necessarily a qualified opportunity.

The more workable proposal is a hybrid: a base fee covering tracking, creative, and weekly optimization, with an incentive tied to a defined CPA or qualified pipeline rather than raw leads. It is less convenient for this department because the target has to be written down. Once it is written down, both sides can check it.

![A magnifying glass over an ad-spend fee clause in a contract.](https://pub-87da24ecbbfc4c3bad6875f3aa013712.r2.dev/generated-images/331e7621-1451-495a-9f11-60d102e0008a.png)

For preparation, use the smaller budget example as well. At $20,000 in monthly spend, our 15% management fee is $3,000. If we recommend $30,000 and CPA does not improve, our fee becomes $4,500. The client has spent $10,000 more on media and $1,500 more on management to find that scale was not the constraint.

Under a flat fee with a written target, the retainer stays the same at $20,000 or $30,000 of spend. The agreement can name cost per qualified opportunity below $180 or ROAS above 3.2 as the number to watch. A buyer with the [agency pricing models comparison](https://groas.com/post/google-ads-agency-pricing-models-compared-2026-guide) can work out the cost and incentive at their own spend level. Be ready before they do it aloud.

**Account-manager takeaway:** the strongest objection is not that our fee is high. It is that our fee rises before the client’s results do.

### Appendix C: Three questions buyers may ask before the next invoice

Expect these on the next call. A buyer does not need a confrontational tone to make any of them difficult. Written answers make them harder still.

1. **“How is your fee calculated, and what happens if we spend more?”** At 15% of spend, every budget recommendation has a fee consequence. The buyer may ask for the fee at current spend, double that spend, and half. Do the calculation before recommending another increase.
2. **“What counts as a conversion, and will cost per qualified opportunity appear on page one?”** If our report leads with impressions and clicks while bidding optimizes for raw form fills, the two reinforce each other. A written definition of _qualified_ would interrupt that arrangement.
3. **“Show me Change History for the last 30 days. What changed?”** They may look for negative keywords, bid and budget adjustments, ad tests, and mined search terms. A calendar full of strategy calls will not populate that screen.

If the answers are vague, the buyer can reconstruct this memo without ever seeing it: the fee scales with spend, the report celebrates clicks, and the learning never ends. Do not forward them Appendix C.

I used to defend percentage-of-spend fees; now I tell buyers to check one line of the contract: does the fee rise when they spend more, or when CPA and pipeline improve?

## Frequently Asked Questions

### How does a percentage-of-spend agency fee work?

The agency charges a percentage of the client's monthly ad spend, commonly 10 to 20 percent, with 15 percent as a typical house example. A client spending $20,000 a month pays a $3,000 fee, and at $50,000 of spend the fee rises to $7,500, even if results such as CPA stay the same.

### Why do some agencies recommend bigger ad budgets even when results have not improved?

Because under a percentage-of-spend fee, the agency's revenue grows whenever the client's budget grows. The memo directs account managers to put a budget-increase slide in every QBR deck before any cost-per-acquisition slide, and to attribute rising CPA to the need for more data and scale rather than to reconsider the increase.

### Why do agencies lead reports with impressions and clicks instead of conversions?

Large impression and click numbers make the account look active, while figures like cost per qualified opportunity invite questions about whether the spend produced customers. The memo's report structure puts impressions, clicks, click-through rate, and average CPC on page one, and mentions conversions only briefly on page four without cost per conversion.

### Is optimizing Google Ads for form fills a good idea?

Form fills are cheap, plentiful, and easy to chart, but optimizing toward them trains bidding to find people who fill forms rather than qualified buyers. The memo favors the resulting lead volume for headline charts even when sales does not call the leads back, so buyers should ask what happens to those leads after the form is submitted.

### How long does the Google Ads Smart Bidding learning phase last?

A Smart Bidding learning phase typically lasts 1 to 4 weeks and can bring inconsistent ROAS and elevated CPA. Major changes to budget, campaign structure, or bid strategy can send the account back into learning, which the memo treats as a renewable resource for explaining why results cannot yet be judged.

### What does Change History in Google Ads show, and why does it matter?

Change History shows every edit made to an account, such as bid and budget adjustments, ad tests, and negative keywords. In one buyer's account of an $800-a-month fee, the screen showed zero campaign work across 90 days with only billing entries, so clients can open it themselves to check whether an agency actually managed the account.

### Why won't the agency write down what counts as a qualified lead?

Because once a qualified lead is defined, it can be counted, and cost per qualified opportunity can be calculated and compared against the agency's fee. The memo instead keeps the goal as generic leads, which rise when spend rises, and leaves clients debating lead quality with sales.

### Is a flat monthly fee better than a percentage-of-spend fee for PPC management?

A flat fee removes the incentive for the agency to push higher budgets, since the retainer stays the same whether the client spends $20,000 or $30,000 a month. However, a flat-fee agency still gets paid if CPA rises or pipeline stalls, so the key check is whether the contract ties work and accountability to results rather than just the pricing model.

## Pay For Results, Not For Hours

Businesses buy the outcome, agencies resell it, and groas answers for it either way.

[See If You Qualify](https://groas.typeform.com/to/xC1bQNUT)

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