Pay-for-performance vs retainer vs % of ad spend
For D2C and e-commerce brands with trackable online sales, pay-for-performance usually fits best: the agency's fee moves with your results (pSkyro Labs charges 5% of the profit). Choose a retainer for broad work that can't be tied to a sale, and % of ad spend for large, stable budgets that need simple billing.
Run your own numbers.
Your numbers
Also called ROAS. Try a bad month (₹1–₹2) too.
What's left after product, packing and shipping costs.
With pSkyro Labs, each month
- Sales from your ads₹6L
- You pay us₹5,000
- You keep₹95,000
We only charge 5% of the profit our ads make for you (sales × your profit on each sale, minus the ad budget). No fixed fee, no retainer. No profit, no fee. “You keep” is your profit after the ad budget, product costs and our fee.
| Who runs your ads | You pay them | You keep |
|---|---|---|
| Retainer agency | ₹2L | −₹1L |
| pSkyro Labs (5% of profit) | ₹5,000 | ₹95,000 |
| % of ad spend agency | ₹27,000 | ₹73,000 |
If a month goes badly (ads only bring back what you spent): you pay us ₹0, while other options still cost you ₹27,000 or more.
Agency fees use the cheap, typical (midpoint) and premium points of the ranges in social101.in and metamktgagency.com pricing guides, 2025–2026.
Want a plan for these numbers?
Tell us where to send it. We'll look at your store and budget and reply with what we'd do and how our fee would work for you.
Which pricing model suits whom?
| If you are… | Usually the best fit |
|---|---|
| A D2C or e-commerce brand whose sales happen online and can be tracked | Pay-for-performance |
| A brand that needs broad, ongoing work (social media, content, PR, brand) beyond paid ads | Monthly retainer |
| A large advertiser with a stable budget that wants simple, predictable billing | % of ad spend |
| A B2B company or offline business where sales close weeks later, away from the website | Monthly retainer |
| A pre-launch brand with no store or sales history yet | Project fee or retainer, then pay-for-performance once you're selling |
How do the options compare?
| Compared on | Monthly retainer | % of ad spend | Pay-for-performance |
|---|---|---|---|
| What you pay for | A fixed monthly fee, whatever happens | A share of the budget you spend on ads | A share of the sales or profit the campaigns generate (ours: 5% of profit) |
| Typical range in India | ₹50,000–₹3.5L+ a month | 7–20% of monthly ad spend | Varies by agency; ours is 5% of profit |
| The agency earns more when… | The contract continues | You spend more | You sell more |
| Who carries the risk of poor results | You | Mostly you | Shared |
| Cost predictability | High: the same fee each month | Medium: moves with your budget | Lower: moves with your revenue |
| Needs reliable sales tracking | No | No | Yes: pixel, events and store data must agree |
| Scope | Broad: whatever the retainer covers | Usually paid media only | Usually paid media plus the creative and funnel work that drives sales |
Tap a see-saw.
When does each option win?
When a retainer wins
- You want one team handling social media, content, SEO or PR as well as ads, and much of that work can't be tied to a sale.
- Your sales happen offline or close weeks later (B2B, real estate, high-ticket services), so revenue can't be attributed cleanly to campaigns.
- You need a fixed, predictable cost for budgeting.
When % of ad spend wins
- You spend a large, stable budget and want billing that's simple to check against the ad platform invoice.
- Your in-house team owns strategy and creative, and the agency mainly buys and manages media.
- Watch out for: the fee rises when spend rises, even if returns don't.
When pay-for-performance wins
- You sell online (Shopify, WooCommerce or a custom store) and every order can be tracked back to a campaign.
- You want the agency's income to depend on your sales, not on hours, contract length or budget.
- You have products that ship and margins that can absorb ad costs while campaigns are tested.
- Watch out for: it needs clean tracking, and the first month is mostly set-up, so revenue (and the agency's fee) starts small.
What does each model cost at the same ad budget?
A worked example for a brand spending ₹2,00,000 a month on Meta and Google ads, using the sourced market ranges. Your ad budget is paid to the platforms in every model; this table shows only the agency's fee on top.
| Compared on | Agency fee a month | What happens if sales don't improve |
|---|---|---|
| Monthly retainer | ₹50,000–₹3.5L+ (fixed) | You still pay the full fee |
| % of ad spend (7–20%) | ₹14,000–₹40,000 | You still pay the fee; it rises if you raise the budget |
| Pay-for-performance | A share of what the campaigns earn (ours: 5% of profit) | The agency earns little or nothing |
Which should you choose?
| Your situation | What we'd recommend |
|---|---|
| You're a D2C fashion, footwear or lifestyle brand selling online and ready to invest in ads | Pay-for-performance. This is the model our results come from: Novo Shoes reached a 6.93× purchase ROAS and Diya Diya an 8× blended return. |
| You need content, community and brand work more than direct sales | A retainer with an agency that specialises in social and content. We're not the right fit for that on its own. |
| You spend heavily, have an in-house strategist and just need media buying | % of ad spend can be the simplest arrangement. |
| You haven't launched yet | Get the store, tracking and creative built first (a project fee), then move to pay-for-performance once orders start. |
Where does pSkyro Labs fit, and when are we not the right choice?
pSkyro Labs runs Meta and Google ads for D2C brands on the pay-for-performance model: our fee is 5% of the profit the campaigns make, no profit means no fee, and your ad budget is paid separately to the platforms.
We are probably not the right fit if:
- Your sales close offline or weeks after the click, so campaigns can't be tied to orders.
- You need social content, community or PR more than paid ads.
- You haven't launched a store or tracking yet. Build those first, then talk to us.
Questions people ask.
Is pay-for-performance marketing more expensive in the long run?
It can be, when campaigns do very well, because the agency's fee grows with your results. That's the trade: you pay more only when you're earning more. With a retainer or % of ad spend, you pay whether or not sales grow.
Do I still pay for ads on a pay-for-performance model?
Yes. Your ad budget is separate and is spent directly on Meta, Google and other platforms. The pay-for-performance part is the agency's fee, which is tied to the sales or profit the campaigns generate (ours is 5% of profit).
What do I need for pay-for-performance to work?
An online store that takes orders, reliable tracking (Meta pixel and Conversions API, GA4, UTMs) and products you can ship. If tracking isn't ready, it's set up in the first month, before the fee starts to matter.
How is revenue attributed to the campaigns?
From the ad platforms' reporting checked against your store's orders, Whichever agency you choose, agree the attribution window and what counts as revenue (for example, whether returns and taxes are excluded) in writing before campaigns start.
What's a typical agency retainer in India?
Published pricing guides put performance-marketing retainers in India at about ₹50,000 to ₹3.5 lakh or more a month, and % of ad spend fees at roughly 7–20% of monthly spend.
How does pSkyro Labs charge?
We get paid only when you get paid: our performance-marketing fee is 5% of the profit your campaigns make. If the ads make no profit, you pay us nothing.
We get paid only when you get paid.
Book a free 30-minute strategy call. We'll look at where your brand is and tell you honestly which model makes sense.