April 27, 2012: Didit’s Mark Simon, writing in the pages of MediaPost, asks us to “Imagine gathering bids for a construction project in your house such as a bathroom renovation. A few hours before the deal is signed, you happen to find out that your friend had his comparable bathroom redone for $7,500 by the same contractor, but your quote comes in at $12,000, for the same work and material. You confront your contractor over the pricing disparity and he tells you, ‘I’m charging you more because you pay more in property taxes.’
Sounds ridiculous, right? It is, but this kind of discriminatory pricing is exactly what many SEM agencies do every day. Just like our mercenary construction contractor, their pricing structure has NOTHING to do with the level of work they do for a client. Instead, it’s absurdly indexed to what a client PAYS to Google.”
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