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Nacho
07-05-2004, 11:41 PM
According to this article titled "Five Reasons Why Ad Agencies Hate Search Engine Marketing (http://www.mediapost.com/dtls_dsp_searchinsider.cfm?artid=257268)" by John Tawadros on Tuesday June 29, 2004 it says:

TRADITIONAL AD AGENCIES HAVE DISCOVERED that search engine marketing is beguilingly difficult. Not only is it more complicated than it seems, but it's surprisingly difficult to eek out a profit doing it.

Companies offering keyword bidding tools have lulled some agencies into a false sense of confidence. "Our bidding tool will make search engine marketing effortless," they were told.

What these companies didn't tell the agencies was that they still needed search engine marketing expertise to use these tools effectively to maximize their clients' results.

As a result, many big, traditional ad agencies-and even interactive agencies-hate search engine marketing. Here are the top five reasons why:


Achieving profitability in managing clients' paid search advertising is extremely difficult.
A shortage of skilled SEM practitioners.
Even "poaching" experts cannot produce superior results.
SEM is so complex it requires singular focus.
SEM requires a commitment to research.

To view each point in detail, read the full story here:

http://www.mediapost.com/dtls_dsp_searchinsider.cfm?artid=257268

Please comment your opinion on this article, give us your thoughts if you feel this how the future of search marketing will be and vote our poll if you agree or disagree with it.

Thanks!

Chris_D
07-05-2004, 11:53 PM
He forgot the sixth reason:

6. Most traditional Ad Agencies just don't grok the web, let alone search...

:)

Mikkel deMib Svendsen
07-06-2004, 02:04 PM
The one agree the most with is actually number 6. :)

Over the years I have worked with and for many agencies - most of them was a nightmare, but a few turned out to be good. The best ones was the ones that left me with the clients, and pretty much stayed out of the loop :rolleyes:

I agree that agencies probably got surprised by the level of complexity SEM really invlolves and the kind of skills it require. I think most agencies thought SEM was a "management" job when in fact, as I see it, is a "production" job. It's not just about managing ads - it's about producing then, do the research in advance and all the other stuff we all know about here.

Agencies was told they could manage this on their own (with the help of a few tools). Haven't we seen this before? Yes, we have :) Just a few examples ...

I was in the graphic industry in the early late 80's when the computers entered the market. Agencies was told, that they could now drop a lot of steps, setup stuff on their own and basically turn over final films for print and save a lot of money. Well, computers did change a lot for that business but one thing that is still the same is the skills required - a skilled person can just do more, faster today, but he still have to be skilled.

Later, durring the 90's I saw the same in the music industry, that I was by then deeply invlolved in. As computers for music flooded the market in the mid 90's everyone was told that they would never need a good sound engineer anymore. Computers did change things a lot but the best sound engineers around still have a good job.

In the last 1-2 years I have seen more and more agencies realize that they should outsource all SEM and just make a commision on the deals - like most other stuff they do. My big question is: Do we want to do the work for them? Personoally i would say yes - some of them, but certainly not them all! I have experienced how some agencies apprarently was trying to abuse me to show clients how worthless SEM was so they could move the budgets to more profitable channels. Naturally I am not going to take part in that. Also, I have experienced agencies that make completely unrealistic promises to clients and expect me to live up to that. I remember one large UK pharma company that was promised to top ranks for a list of the most competitive phrase (you all know which!) and they had a $500 budget.

Anyway, I think we, the ones that know about SEO/SEM, stand pretty strong :)

pleeker
07-06-2004, 05:36 PM
6. Most traditional Ad Agencies just don't grok the web, let alone search...


:) That practically sums up the entire article.

Some of the article rings true, some of it not. In the end, I think what Mikkel is getting at is what's most important: knowledge wins out. My guess is that many ad agencies don't have the knowledge, don't have the wherewithal to acquire it, and ultimately, they probably wish SEM would just go away.

St0n3y
07-06-2004, 06:58 PM
I think the article is true but only from an Ad Agency's perspective. In reality, their conclusions (or justifications) are false.

Nacho
07-06-2004, 07:10 PM
I think the article is true but only from an Ad Agency's perspective. In reality, their conclusions (or justifications) are false.
Would you please give us your reasons why?

Thanks :)

St0n3y
07-07-2004, 12:07 AM
On first read I got the impression that Ad Agencies did not like SEO providers, but upon a second read it appears that it is SEO itself which they have the problem with.

That's understandable because SEO isn't as "simple" as many think and many businesses find that out the hard way. Ad agencies wanting to delve into the SEO industry would also find that out. SEO is profitable but like any business quality must be sold to the potential client.

Achieving profitability in managing clients' paid search advertising is extremely difficult.

This is relative. You can always find a way to make it profitable. If your skills are worthwile the clients will pay.


A shortage of skilled SEM practitioners.

There are alot of bad SEOs out there but there are also plenty of quality SEOs, many of which are not turnng away business.


Even "poaching" experts cannot produce superior results.

I've not heard the term "poaching" so I can't comment.


SEM is so complex it requires singular focus.

This is very true, which is why working with an SEO agency would be in the Ad Agency's best interest.


SEM requires a commitment to research.

see note above.

steve sardell
07-07-2004, 01:00 AM
To me it is an article of generalities with no proof to back the major points. I would have liked to have read some specific comments from the ad agencies to back up the authors suppositions, or some quotes from the successful SEMs who have gone to the *traditional ad agencies* and not had continued success and why.

There is no doubt SEM/SEO takes focus, but this is true in any marketing medium.

The problem the author failed to mention is legitimacy, and how a traditional agency can chose who to partner with and trust, if they do decide to outsource. Traditional ad agencies have standards while the SEM/SEO is still in the nurturing stage and riddled with contradictory methods. Who can blame the TAAs when they question our methods. They have earned their clients trust we need to earn theirs.

PS. Poaching is another term for raiding another companies talented employees.

Robert_Charlton
07-07-2004, 02:09 AM
SEM requires a commitment to research...

How about, "SEM requires a commitment"?

When you're dealing with agencies of any size, you're generally dealing with corporate clients, and that means you're dealing with a bureaucracy... there are marketing people and creative people and production people and account people and lawyers and brand managers and IT people and whatever.

In my experience (in doing organic SEO) with large corporations, every communication and decision becomes highly territorial and political. You're not only dealing with ignorance... you're dealing with inertia. Even when the proper research is done, the process can become so watered down it's a wonder there are any useful results at all.

The agency people can be great, but they're extremely cautious about pushing their clients. In my experience, it generally takes someone powerful within the corporation who really gets it for you to accomplish anything. If the agency is in league with that person, you're in luck. Otherwise, it can be a dismal experience, and the agency will conclude that SEO is difficult.

steve sardell
07-07-2004, 09:45 AM
In my experience (in doing organic SEO) with large corporations, every communication and decision becomes highly territorial and political. You're not only dealing with ignorance... you're dealing with inertia.
No question this is a problem dealing with the corporate mentality. The entrepreneurial mindset is to get things done now while in the corporate there are too many channels one needs to follow.
The agency people can be great, but they're extremely cautious about pushing their clients. In my experience, it generally takes someone powerful within the corporation who really gets it for you to accomplish anything. If the agency is in league with that person, you're in luck. Otherwise, it can be a dismal experience, and the agency will conclude that SEO is difficult. Agree here also. In my exporience dealing within the corporate the vast majority are more concerned with protecting their own cubicle as if it were a bell jar. But, I do not fault them for being over protective of their clients, especially those which have taken years to cultivate.

doppelganger
07-07-2004, 11:59 AM
I work for the interactive arm of a tradtional ad agency. Our search engine marketing department is quite accomplished. We don't outsource, it's all done in house, and we have not underestimated the time and dedication that search engine marketing needs.

It seems to me that this article is severely underestimating ad agencies.

I came away from this article with some broad generalizations about ad agencies and the feeling that the author was harboring some animosity... perhaps from a bad experience.

Mikkel deMib Svendsen
07-07-2004, 12:25 PM
doppelganger, good to hear your side of the picture too. I absolutely agree that it's not so black and white. Some agencies, like yours, are doing great. However, I think I am not the only one in here that have had several bad experienced with agencies - especially the largest ones. It does color the picture :)

steve sardell
07-07-2004, 12:58 PM
I came away from this article with some broad generalizations If it were an editorial style article would have been one thing, but as statements of fact IMHO it poor. The author reveals no indication of what type, size, location, age, etc. of the agencies he is discussing. To me there simply was not sufficient thought before writing. I realize, according to the poll I am in a minority, but I always do have a tendency to quetion the written word.

Jeff Martin
07-07-2004, 03:02 PM
1. Achieving profitability in managing clients' paid search advertising is extremely difficult: If you don't use a bid management tool, and if each of your customers doesn't spend in excess of $50K per month on paid search advertising, you won't make money. Period. Trouble is, even many of the large client companies who employ agencies cannot justify spending more than $3K to $10K per month. The conversions aren't there; the keyword query frequency is not there.

We could always charge hourly or on a project basis, or by some other means instead of a percentage. Not every client I have spends over $10k a month on paid advertising but I still turn a profit on them. As long as you understand their goals and they undertsand the resources needed to reach those goals (and they are willing to commit the resources) then you will be profitable.

Even "poaching" experts cannot produce superior results

So we are only as good as our firm's tools? We are the most important tool! The experience we take with us is more valuable than any tool we can buy. Can I get an Amen???

:cool:

steve sardell
07-07-2004, 07:00 PM
So we are only as good as our firm's tools? We are the most important tool! The experience we take with us is more valuable than any tool we can buy. Can I get an Amen???

You got it!

Opie1Canopie
07-08-2004, 11:33 AM
Umm it appears that the author works for a large SEO/SEM firm, so that may explain the angle.

From recent experience, I definitely think that a SEO/SEM specific firm can do a better job than one of our general marketing/ad agencies has so far. But that's not to say all ad agencies are clueless - like PP mentioned, there are very good agencies with strong SEO/SEM departments out there.

Kal
07-08-2004, 11:51 PM
He forgot the sixth reason:

6. Most traditional Ad Agencies just don't grok the web, let alone search...
You got it! But you forgot the 7th reason:

7. SEM ruins the "brand experience" of the client's shiny new $100K web site by replacing the Flash bells and whistles with.... shock, horror.... TEXT! :eek:. Clients would much rather entertain 100 visitors with their minute-long Flash movie than attract 1,000 targeted visitors with a boring text site :rolleyes:

Chris_D
07-08-2004, 11:57 PM
Doppelganger wrote:

I work for the interactive arm of a traditional ad agency

The point here is that your agency is relatively unique. As I said - most traditional ad agencies don't grok the web.

And most 'interactive' agencies (i.e those who do creative banner ad executions, popunders, page takeovers etc.) don't grok search. Hey - I spent the last couple of years with one of Australia's largest web dev/ interactive agencies....

Heres a really simple test.

If an agency's website (traditional or interactive agency) is 100% flash; or has a flash intro; or is 90% flash with DHTML drop down menus; or they use a content management system (with dynamic urls and session IDs) to manage the entire site; or has less than 20 words on a page - then the article fits pretty well......

:)

Nacho
07-09-2004, 12:21 AM
6. Most traditional Ad Agencies just don't grok the web, let alone search...
So true! Not to mention they can go nuts when one of their client's CEO sees their BRAND under a top 10 rank with an "I hate" or "Boycot this BRAND" listing.

-------------------------------

With a different topic (but related) . . . how IRONIC to see this article go out today:

Ad Agencies & Search Engine Marketing Firms Beginning to Play Together (http://www.searchenginewatch.com/searchday/article.php/3378131)
By Shari Thurow, Guest Writer
July 8, 2004

Advertising agencies are spending more on search engine marketing, with one in five marketers buying in excess of 1,000 keywords, according to Jupiter Research.
Comments anyone?

St0n3y
07-09-2004, 02:01 AM
7. SEM ruins the "brand experience" of the client's shiny new $100K web site by replacing the Flash bells and whistles with.... shock, horror.... TEXT! . Clients would much rather entertain 100 visitors with their minute-long Flash movie than attract 1,000 targeted visitors with a boring text site

So true. I don't know how many potential client's I've turned away because they wanted optimization WITHOUT the actual optimization.

Kal
07-09-2004, 04:13 AM
Comments anyone? I think Shari's been partaking of the green koolaid again :D

Mikkel deMib Svendsen
07-09-2004, 12:00 PM
> So true. I don't know how many potential client's I've turned away because they wanted optimization WITHOUT the actual optimization.

Thats what we call "AdWords" :)

webmama
07-09-2004, 03:21 PM
It is clear to me that the Media Vendors (google, yahoo, etc) agree, at least in part, with the article. They have mature and developing programs to support SEM companies. It is clear that they value SEMs over agencies primarily because we require less ad development and bid management support. The fact that we have more knowledge than many of the client services people is hard for them and they are stepping up to putting trained people in place who understand how SEM companies work. [A move in the right direction that is moving too slowly for me]. They know that if they provide decent ad products and continue to innovate on new products that represent advertising opportunities for our clients - we will encourage our clients to try them out. Agencies are more conservative and slower moving, thus don't move money to search marketing, especially new products, quickly.

Agencies hold the big bucks of the big brand companies. This is the money that media vendors - and their direct sales reps - want to get their hands on and understandably so. I want to get my hands on some of that money as well :). Agencies require a ton more training, creative help and client services from media vendors - but they have a ton of money to spend.

So, the media vendors need to work with both groups. Let's hope they continue to see the need to support SEMs separatley. As SEMPO president I am happy to say that SEMPO has quite the voice with the media vendors and will continue to yell loudly about providing programs for SEMs.

yellowwing
07-10-2004, 12:14 AM
1. Achieving profitability in managing clients' paid search advertising is extremely difficult:
Agree. The most glaring deficiency I saw in professional PPC was that they did not report to the client the amount of impressions of their paid keyword. The client got reports like, "this week you had 200 click throughs and 20 hotel bookings worth $6k. The costs were $250."

Which on a nice report looks great. They didn't show that just under 5,000 targeted clients saw their paid keywords and ignored it for the organic results. SEO is still a goood opportunity.

2. A shortage of skilled SEM practitioners:
Agree. Even a large client cannot train a SEM as well as a professional SEO firm. The SEO firms give the practitioners dozens to hundreds of sites to hone experience and technique.

3. Even "poaching" experts cannot produce superior results:
Agree. You can take your experience, but you can't take the custom software with you.

4. SEM is so complex it requires singular focus.
Disagree. The singular focus is absolutely needed by SEO apprentices. After a few projects you can see that it is a methodology, not rocket science.

5. SEM requires a commitment to research:
Qualified Agree. Once an SEO practitioner grasps the process, most research should be on evaluating the competition and how to beat them.

andrewgoodman
07-10-2004, 08:58 PM
The skills top SEM firms have can take them far -- in search marketing, or even barging into traditional advertising and blowing the status quo to smithereens.

Ad agencies have much going for them -- tradition, clients, money, bigness, youth, bravado -- but as a recent article, Nightmare on Madison Avenue (http://www.fortune.com/fortune/articles/0,15114,650390,00.html), in Fortune pointed out, it's not all hunky dory in that world.

To those bravest of SEM's I say only:

"First we take Manhattan...."

Why play their game when you can invent a new game? Remember Microsoft CEO Steve Ballmer's recent comments:

Ballmer went further, saying that in 10 years, all media dollars will wind up online, because the separation among PCs, televisions and mobile devices will no longer exist.

Will today's advertising agency be able to stomach the new era of total accountability in ads?

Kal
07-12-2004, 02:57 AM
Will today's advertising agency be able to stomach the new era of total accountability in ads?Damn good point!

Incubator
07-12-2004, 11:41 AM
Damn good point!
I agree as well, until large ad agencies move away from just justifing results to clients, the campaigns they are running will only allow the ad agency to "pat themselves" on the back. Justification of whether a campaign is success or not is very easy to point out in SEM, thus some agencies are not fully qualified and capable now to upsale or re-negotiate SEO /SEM sales as a re-newal.
Once again not all of them but the odds favour the ones who cant

My 2 cents

Cheers

WC