JupiterResearch Study: 3 in 4 PPC Firms Selling Rubbish Services

14 comments

A recent SearchEngineLand post highlighted that nearly three-fourths of companies that outsource PPC are dissatisfied:

  • Most agencies specialize in consumer search marketing and their services are inappropriate for your unique needs as a B2B company.
  • The agency business model skews in favor of the largest spenders and under-serves the majority of B2B advertisers.
  • Agencies will never understand your customers and your business as well as you, especially B2B firms that sell more complicated products and services.
  • The need to coordinate with outsiders implies latency and information loss, meaning you lose the flexibility and agility to react quickly.
  • Outsourcing means losing control over a critical portion of your demand generation strategy to outsiders who may have different incentives than you.

Comments

PPC isn't like SEO

It's something that one has to measure ROI quickly in *many cases* ... unless the external agency has direct access to what the ROI goals are in near real time.. it could cause some waste.

I do however feel that outsourcing PPC is not a bad idea for a firm that has limited skillset with it. Just that the lines of communication have to be near real time in again *MANY* cases.

agencies

if you trust your advertising to anything that calls itself an agency, then half of your budget will be wasted, and you'll never know which half.

bad joke? maybe but I wouldn't spend my money with one.

Outsourcing only makes sense if you know how to pick a good vendor. Otherwise, do what companies do with all other issues where they realize they have no skill: appoint in-house people to learn, and hire in knowledge and buy consultation.

Just because it's advertising they think they can throw their money away, when there are more metrics than have ever existed - more fools they, and of course the agencies just rip 'em.

I hope SearchEngineLand

I hope SearchEngineLand isn't going to do more articles like that, where the author is basically using the venue to make a case for his own product.

I agree with much of what was said, but even so I can't trust it because of the source and obvious conflict of interest.

I expect blatant "there's a problem but there's a solution" articles like that in "Modern Widget Technology Today" trade rags, but not SEL.

Nope, not the plan

I added a comment to the story that we should have had him explain why he might have that particular viewpoint right at the time. He doesn't actually pitch his product. In fact, you can't even buy his product right now. He does pitch a scenario that explains why people might want to use his (or other products) to do PPC themselves. There are some good arguments, as you note John, but you certainly feel better about the story if you know why the author might think that way from the outset. If we have these situations in the future, we'll do a better job with them.

it sounds like the kind of article

with an agenda I would expect elsewhere, but not on SEL.

There's some decent & interesting points made, but they are surrounded by a lot of self serving, short sighted BS.

"However, I believe that your best results will come from having your PPC campaigns managed by the true experts – you. The same techniques and best practices used by agencies can and should be automated with technology. Choosing B2B search marketing software allows you to optimize your PPC campaigns like an expert, without the loss of control, latency, and overhead associated with an outside agency."

So you just need this software to be an expert?. Brilliant.

Sounds like a sales pitch to me.

PickledResearch Study: No shit!?

and my study only took seconds to complete.

I can do it all...

So, maybe I should start doing my own taxes? After all, no one knows my business like me...

I'm Willing To Bet

that Danny won't let that happen again. Now if he'd just get rid of TypeKey so people could comment there...

Those aren't the reasons

[I'm with Efficient Frontier a U.S. SEM managing $300M+ in annual spend. My opinions are my own and *may* be biased]

The reasons most advertisers are dissatisfied with their SEM is that in the majority of cases the SEMs have sold themselves as having technology, people, processes, experience and results that they...just...don't...have.

We see this all day long, whether it's

1) an SEM saying they have a great platform that tests all possible keyword variables and targeting options. Never mind the fact that testing *all* variables is a perfect way to not have enough data to opimize anything...

2) an extremely well-known SEM guaranteeing a 15% performance improvement to each and every company they talk to, irrespective of inflation, market dynamics, budgets, etc. To an uneducated buyer, hearing this sort of guarantee from someone whose columns he/she reads on SEM industry sites makes it believable, but the reality is it's a sales tactic used out of desperation.

3) an SEM securing a $0 test with one advertiser in an industry and then going to 5-10 other firms to tout their 'proven industry experience'. Gimme a break.

The reason most SEM's suck is not that outsourcing is the wrong model. They suck because all anyone needed to build an SEM business several years ago was... a pulse. Pulse-bearing SEM's thus sprung up, got lots of customers based on lies, cheating and/or buying business with $$$ from VCs and angels who took the definition of 'dumb money' to new, dizzying heights.

Now, however, SEM requires more than just buying keywords. You can't just have smart people because smart people alone can't scale to handle all the business they can get. Nor can you just have technology, because whether you're talking B2C or B2B there are and forever will be aspects of SEM that can't be automated and require the regular intervention of smart SEM tacticians, data analysts and the like.

As for technology, 95% of the SEM's out there have done nothing more than web-ify the Excel spreadsheets they used to manage bids back when GoTo was the market, bid landscapes were transparent, and keyword management was a cat and mouse game between two geeks who were both running non-branded protractor comparison shopping sites.

Today you have opaque markets, markets where everyone has found the good keywords, and everyone has web analytics in place and some understanding of LPO. Advertisers are hitting volume and margin ceilings they can't get past in search and they're finally looking at what their SEM has been doing and realizing with horror that their supposedly sophisticated partner had a great pulse, but not much else.

There are a few good SEM's, though, firms that have taken little VC money, who built either scalable processes, novel keyword optimization technology, outstanding teams or some combination of the above. Find those firms and you'll do better than you could *ever* hope to do on your own.

EBay's VP Internet Marketing - Matt Ackley - gave a keynote presentation on the search day portion of eTail 2007 in Palm Springs a month ago, in which he described how they've invested $15M+ in technology and have 100 people working on SEM systems and operations there. EBay can do that because they're eBay, but for most companies that's not an option, nor is hoping a web-ified Excel spreadsheet will save their day.

Actually, I'd tend to agree

Actually, I'd tend to agree that a lot of PPC can / should be automated. Whilst human judgement is necessary to get the best out of high CPC / volatile / high traffic terms, no human can run a 30k term campaign and give individual attention to every term.

Put 29,800 of them in an automated rules-based management package, and actively mangage the other 200, which probably represent 80% of the traffic anyway

In-House Staff, Outside Specialists & Technology

are all needed in the mix (unless you are ebay of course). As somone who has gone from taking on a one off PPC client here and there where I created keyword lists and ad copy to the management of a large ppc account (And people wonder why I haven't been blogging - lol) I actually see the need for in-house people, technology and ppc specialists consultants/outside ppc firms. GOD has life been easier because we have an outside ppc specialist consultant that works with me. And while the technology we use in-house helps me figure out what to do, human insight seems to help figure out why we should do something. Like trying to figure out why thousands of keywords went inactive seemingly overnight; the software told me what to change but human insight helped us figure out why it happened which will help us avoid this hapenning in the future.

BTW: Does anyone know where the actual report is, seems the original article quotes it but doesn't link to it - it's one of those I gotta read it for myself things. Shorebreak you win for the best comment I've read in a longtime & Glad to hear Danny won't let SEL become DMNews ;).

Shorebreak you win for the

Quote:
Shorebreak you win for the best comment I've read in a longtime & Glad to hear Danny won't let SEL become DMNews

+1 and +1

Thanks Danny and Shorebreak for bothering to post.

Debate is a good thing, right?

Wow, my article sure did stir up some debate!

First of all, let me agree with Danny that I should have made it clearer from the start of the column that I represent a software vendor that sells B2B search marketing tools. It was never my intent to mislead anyone and I apologize that some of you were offended by what was perceived as a "sales pitch".

That said, I don't think a software vendor claiming that in-house is the best approach is any different from an agency claiming that outsourcing is the best approach -- and there are plenty of articles that make that claim. I guess that is what makes open debate so great!

PS: Catchafire -- There are quite of few people out there (including myself) who do their own taxes with the help of software such as TurboTax or similar. I'm not a tax expert, but I know my taxes are done right!

sure

Downloading TurboTax is a good start, but it doesn't make anyone an expert. I use financial software too, but I always have a CPA look everything over and do the 'heavy lifting'.

Like everyone is noting above, a combination of software, human insight, and experience make for the best campaign results.

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