We charge 20% of total ad spends of the business as our service charge.
Our revenue model is simple and dependent on spends by our business, If we provide business growth to the businesses by increasing their revenue, their ad spends will increase, which will increase our revenue.
How did we arrive at 20% as service charge?
If we look at current solutions used by small businesses to generate leads, they follow one of the below revenue models
— Monthly Retainers or Monthly Subscription Fees
Problems with this type of model:
User have to pay fix amount irrespective of number of leads, So there is high resistance for user to convert first time.
Benefit of this model:
The cost for user doesn’t increase as user’s scale increase, but high resistance to subscribe first time overshadows this benefit.
Mom & Pop Agencies and Freelancers follow this model
— Cost Per Lead Delivery
Problem with this model
This model is good at lower scale but it fails to provide scalability and cost savings due to high scale to the user. Also this model is prepaid in nature
Benefit of this model
User knows the actual outcome and number of leads and it becomes easier for user to measure ROI.
Classified platforms like Justdial and Indiamart follows this model
— % of Ad Cost
Problem with this model
User doesn't know till the cost per lead till the first lead
Benefit of this model
This model has minimum resistance in gaining user trust , Also user only needs to pay if he is running an campaign, Also this model gives full freedom to the business of starting and stopping lead generation at will.
Agencies and Other Ad platforms use this model.
Looking at limited problems and decent benefits we decided and service fees as % of ad spends as model.
Current Market Rates of % of Service Fees
Agencies for SME - 15-20%
Agencies for Enterprise(Spends more than 5 lacs per month) - 5%
Ad Platforms - 15-20%
We decided to replicate rate charge by agencies currently, But our benefit is GrowEasy is a human less agency as all operations are managed by either artificial intelligence or a software
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Revenue Model