Avinash Kaushik: Time to Rethink Contracts with SEO Agencies — Save 25-75%
Avinash Kaushik, who worked at Google for about 16 years and held leadership roles at Intuit and DirecTV, and is now Chief Strategist at Human Made Machine, argues that AI can reduce agency fees by 25-75% right now. He urges marketers to immediately rethink contracts and stop paying for work done by machines. In this article, we break down why old contracts with SEO agencies are losing relevance and how to build a new, mutually beneficial structure.
Why It’s Time to Rethink Contracts
Kaushik highlights three converging factors: AI has become broadly intelligent, advertising platforms own basic AI models, and all systems communicate in real time. This has created a «we’re not in Kansas anymore» moment for all types of agencies, including SEO.
Work that once justified a monthly retainer is now performed by the platform. Kaushik expects savings of 25-75% on existing volumes of work and a 15-25% increase for genuinely new work not covered by the old contract.
Where the Old Contract Loses Meaning
Kaushik breaks down the old scope of work into clusters. Account architecture, keyword and audience structuring, campaign setup — about 20% of a typical contract’s cost — could shrink by 80%, as platform algorithms segment and target better.
Manual bid adjustments and pacing — AI has outperformed humans since late 2024; moreover, manual «saving» during algorithm training sabotages its performance.
Reporting — weekly decks, status meetings, manual comments — about a third of costs; 60% of this can be eliminated, as AI tools explain data themselves.
Contract Structure Proposed by Kaushik
Kaushik suggests splitting fees into three parts:
- Base retainer (40-50% of a smaller total budget) — for management, strategy, data engineering.
- Project fees (30-40%) — for work requiring human judgment: creative concepts, complex strategic analysis.
- Performance bonus (15-25%) — tied to incremental profit or confirmed revenue growth, not platform metrics (e.g., ROAS) that the platform may inflate.
What SEO Teams Should Do
First, take your current SOW and sort each line: anything resembling template keyword research, manual rank tracking, technical audits — put it in the «platform already does this» bin. Be honest about how much retainer goes to this work.
Second, propose a new structure: a smaller base retainer, project fees for strategic work (entities, content architecture for AI Mode and AI Overviews, GEO strategy), and a bonus for organic revenue or Citation Share of Voice growth.
Third, ensure you own your data (GA4, Search Console, logs) before negotiations — otherwise, you have no leverage.
Frequently Asked Questions
Does this mean SEO agencies become useless?
No. Those who stop selling hours and start selling judgment, which machines cannot yet provide, will survive. Agencies that continue billing for monthly rebuilds and manual reports will lose clients.
What metrics should be used for the bonus?
Incremental profit or confirmed organic revenue growth, not vanity metrics like rankings or number of published posts.
Conclusion
Kaushik concludes: «You can pay for the past or for the present.» Most SEO teams are still writing checks for the past without realizing it. It’s time to change that.
Ready to rethink your contracts? Start with an audit of your current SOW and an honest conversation with your agency. Savings of 25-75% are not a forecast but a reality available today.