Tons of experience with this sort of scenario.
1. I would show them what their competitors in search have on their websites in regards to content, and also their link profiles using a tool like Ahrefs.com (not an affiliate).
2. I would show them the search volume for their target keywords so they can plainly see the results they could be achieving as a percentage of what's possible.
3. I would make sure they are ready to go beyond just advertising for growth and if so, if there are changes that could happen on the site to show short-term results, that should help to point those out.
4. I would increase the rate for a shorter term project allowing you more resources to implement what's needed. It doesn't just so happen that SEO takes exactly 12 months, people just tend to charge that way. SEO can take place very quickly or very slowly depending on how you approach it and the workload/price are directly related to the speed and volume of results.

I hope this helps and good luck! Let me know if I can help any further.

-Jeremiah