I've been waiting for a thread to pop up on this topic in the past few weeks, and finally one sprung up that caught my attention over at HighRankings. The thread is about a small SEO firm who needs to provides his client with an answer to "Why Should Customer Renew?"
Pretty much all of the on-page search engine optimization (seo) efforts are done or should be done right up front. So let's say you have a client with a five page site. You optimize each page for the client and then sit back. If your not providing any link building services, then in reality your work is done. Of course, you might want to see if the keywords are a good fit for the site. You might need to make some tweaks here and there. But after, lets say, three months, what else is there? Reports. :)
Many of the SEO professionals in the thread agree, that they should only charge for actual work performed. To tell a client that they would drop in the rankings if they don't renew a contract is wrong. Again, this only applies to the on-page seo efforts. I do understand that keeping links up to a site, will require additional money and time.
I prefer to take this one step further. As many of you know, I am big-time into building dynamically driven Web sites. That means, empowering the customer to manage the site themselves. By building a search engine friendly site that can be easily maintained by the customer, he/she can add/edit/delete pages as they see fit. Can all clients write well for search engines? Maybe not, but I want them to try. If I can properly educate the client on the basics of SEO copy-writing, then we have a winner. So there is no reason to even pay a monthly fee or hourly fee to have an SEO review your copy.
Let's say Google makes a major change to its ranking algorithm, they now put a ton of weight on the meta keywords tag (not true). Then, a programmer can make a single change to a template file in a matter of minutes. The site will automatically pull data from a data-source in the database and build keywords for the meta-keywords field. There you go, you can charge for 6 minutes of work. :)
I personally believe that most on-page seo firms should not charge a monthly fee. They should base prices on work performed and not to base prices on reading forums or go to conferences. Man hours = billable.