How is a retainer used in social media?
I've gone through periods where I've charged clients retainers but I've stopped recently because I am unsure how to allocate the funds of a retainer. Do you charge a retainer and if so, how do you use it for the client and to make your business stronger? I feel like a retainer could be used in a lot of good ways but I'm just not sure how! Any suggestions would be greatly appreciated! Thanks!
A Retainer is just that: a deposit on account. You need to agree with your client how you apply the funds.
Really there are only two ways:
1. posting the invoices and agreeing each month which invoices they intend to pay, as
well as the the top up to the retainer.
2. The most frequent method of allocation of funds from a retainer is a legally recognised
proceedure known as : "Claytons rule of allocations".
Very simply it means that you allocate the funds to the oldest invoice on the clients account, until the money runs out. In order that the carry on the facility, they must either make a further payment to bring the account up to the agreed level at the end of the month. Alternatively if the retainer runs out during the course of the month, a top-up must be paid in, alternativey the invoices rasied that month paid on a cash with order basis.
If there is money left over from the previous month, the client need only pay enough funds to you to bring it up to the agreed retainer level.
This procedure has three advantages:
1. As vendor, you know that you have sufficient funds to cover orders, and it eases
2. It reduces the need for Credit Checks as you know the money is there and if the
money dries up you know it is time to stop trading with the counter party.
3.You are holding the money in your bank account, reducing your overdraft interest,
alternatively allowng you to accrue interest if you bank account pays interest .
The only draw back is should there be default on your part, i.e. failure to supply then the counter-party can recover the money under a County Court Judgement, and Garnishee
(Third Party Debt Order) your bank account. If the sum were over £1000, then in theory the other party could apply for a winding up order.
We 1st outline the goals that our clients are looking for. Based on these goals, we put together an ongoing marketing plan to ensure we hit these goals.
In most cases these goals include social media, SEO, website tech support, content creation and local directory submission.
We explain the benefits of each and why each one is needed for their ongoing marketing.
We than explain what the monthly fee will be and show them a savings for packaging it and providing us a year contract, which is paid monthly.
Each month we show our clients the ROI & growth in traffic and search engine rankings. this validates our services and even more importantly than the retainer is the referral we get
All the best to your success Auggie
Hi Alex.We basically map out the objectives for a client together with the client on a monh to month basis. Inhouse we usually have a framework agreement (different for setup phase from operational phase) and inhouse know how many man hours are required to achieve each months objectives. The best part is to over estimate and be in a position to invoice a client at the end of the month to replenish the retainer for less than the original deposit. Hope this helps.
We actually changed the term retainer to "Deposit on Work" with our clients which seems to help them better understand how the retainer is used: Each month the client prepays and we deploy a set strategy of services which, in our case, includes social media (and consulting, marketing campaigns, graphic design, website maintenance, reporting, etc.) as part of their monthly marketing program, based on their budget. Internally we manage the projects by the hour assuring we maximize the time allotted in the budget and fulfill our commitment to the client's program.
I have multiple clients on retainers and the way that I utilize them is as follows:
When a campaign is presented, it is presented at a flat fee if the client chooses (or has someone to maintain the campaign internally) however, if the campaign needs a dedicated Community Manager (CMngr), then the retainer is employed. I present them with daily responsibilities of the CMngr as well as allotted time for the campaign. It is also agreed that if for any reason there is time left over, it can be carried on to the next campaign or it can be used for other business related duties such as - research, other campaign ideas, outreach programs and more. Having a retainer instead of a flat rate is a good way for you to show the client that you're open to working with them for longer periods of time as opposed to a flat fee, which usually it means that it may be a one time thing. Also, be flexible and open to change your payment methods. i hope this helps.