Nearly three-fourths of companies that outsource their pay-per-click search marketing to agencies are dissatisfied with their results and only 21% are satisfied as per a study by Jupiter Research, said Jon Miller, the VP of Marketo in a recent article on Search Engine Land.
Although I haven’t got my hands on that research yet but for the argument’s sake lets just say the findings are correct. Jon Miller goes on to explain what causes this dissatisfaction. Without going into his experience working with PPC agencies, I would like to counter his viewpoints. Here we go (first his argument in quotes followed by my counter):
“Most agencies specialize in consumer search marketing and their services are inappropriate for your unique needs as a B2B company.”
- Is this your own observation Jon or did you just forget to quote the research that came up with this finding? Nevertheless I could partly agree that most big ticket agencies specialize in consumer search marketing, but that doesn’t mean there is any shortage of PPC agencies that specialize in business search marketing. It’s actually an opportunity for b2b companies to work with smaller and more performance driven boutique agencies that specialize in b2b search marketing, no?
“The agency business model skews in favor of the largest spenders and under-serves the majority of B2B advertisers.”
- Forget B2B, that’s a good reason why smart marketing managers of even consumer focused brands should rather work with a performance driven boutique PPC agency. Are you trying to sell Marketo to less-informed marketing managers Jon? Or did you mean that only big media houses with consumer brands in their portfolio make the best of PPC agencies?
“Agencies will never understand your customers and your business as well as you, especially B2B firms that sell more complicated products and services.”
- What about PPC agencies that specialize in specific B2B verticals? Do you think the PPC specialists managing campaigns in a particular B2B segment for years couldn’t force multiply with the B2B marketers, having better understanding about their service offerings and industry? Do you think PPC agencies always work in silos? Or may be you are speaking from your experience working with PPC agencies from Mars or Venus that took light years to send communication back and forth?
”The need to coordinate with outsiders implies latency and information loss, meaning you lose the flexibility and agility to react quickly.”
- Now that’s a flimsy attempt at instilling unsubstantiated fear in the minds of B2B marketing managers at its best. Not all PPC agencies work like outsiders. Also the implied latency and information loss can happen across different teams well within the organization itself. Going by your logic, organizations should never work with outsiders and do everything in house?
Also how frequently do B2B companies change or add their service offerings? Once a week, Month, Quarter or Year? Realistically speaking how often are they likely to come up with a campaign overnight that would cause outside PPC agency partners not being able to respond quick enough?
On the contrary, PPC agencies could actually help improve flexibility and reaction time by force multiplying the domain specific expertise and added experience they bring to the table. Whereas marketing automation softwares like Marketo could only provide data and actionable insights at its best. PPC experts from the agencies could actually help make not only better sense of this data and insights but add more logic to decision making as well. Would you disagree Jon?
“Outsourcing means losing control over a critical portion of your demand generation strategy to outsiders who may have different incentives than you.”
- I am glad you took this argument all the way to put marketing automation software against not only PPC agencies but to the extent of outsourcing as a whole concept.
Hiring a PPC partner agency and outsourcing are two very different concepts. As far as outsourcing is concerned, I believe B2B marketers can see whether or not outsourcing works for their business. I would counter your argument when it comes down to a PPC partner agency vs in-house. But that might be the discussion for some other day, another article may be.
Jon clearly saw this as an opportunity to push forward the envelop for his marketing automation software Marketo. However in my opinion he took his arguments a little too far, by recommending Marketo could entirely replace what PPC agencies bring to the table. Here is what he said:
”The main value provided by agencies is expertise with SEM, and as I’ll explain, you can bring much of that expertise in-house by using the right kind of pay per click management software.”
That sounds a lot like Sheldon Cooper from the popular sitcom Big Bang Theory imagining time-travel in his shiny new, signature time machine. I mean seriously, your marketing automation software “Marketo” is already so artificially intelligent that it could bring much of what the PPC specialists with years of experience managing PPC campaigns for specific industry segments have to offer?
If that was the case then Google should have acquired Marketo by now and replaced all of their AdWords strategists. Why only AdWords specialists, AI could replace even replace those trying to sell marketing automation softwares, correct?
But no he doesn’t stop there and goes on to say…
“A technology solution can create the best of both worlds: the control and business knowledge of doing it yourself, combined with the SEM best practices and techniques of an expert.”
WOW, so just like going far enough to rule out outsourcing this time he says a technology solution is about to replace humans with brains.. At this point I am just wondering which version upgrade of Marketo will make it competent enough in writing such self-praising blog posts by itself?
Or how far are we from seeing Marketo make a list of B2B marketing companies in need of new business, install itself on their computers, setup and run their PPC campaigns and then take those leads, call the prospects, negotiate a deal, sign them as clients and just tell the CEO what was the ROI from their PPC advertising? I bet we aren’t too far from that scenario, given how intelligent Marketo is already today.
Pro Tip: Beware Jon, Marketo may have already become smart enough to replace your expertise. On a scale of 1-10 how inconvenient is this truth?
Now lets dive a little deeper into his arguments exposing reasons how PPC agencies convince B2B marketers to outsource their PPC campaigns.
Why Companies Outsource their PPC Campaigns?
Jon’s first argument is that PPC agencies use the concept of FUD (fear, uncertainty and doubt) by saying:
“Search is really, really hard – you should leave it to the experts.”
So three questions we need to answer here:
1. Is this really why companies hire an agency to manage their PPC campaigns?
Chances are that you as a marketer possibly had this thought in yourself while you went about searching for an agency. I have even heard some of our clients (marketing managers) say that they are looking to hire a PPC expert just to speak our language and get the best out of this relationship, despite us insisting that we can educate them enough to know what we are doing.
2. Is Search marketing really that hard that you should leave it to the experts?
No, search marketing isn’t that hard. I could educate you enough in an hour to know how it works and what metrics you should track to ensure things are being done the right way and results are effective.
However planning and managing PPC campaign does have several aspects to it which you could learn with experience. Each business with its own unique challenges and objectives would need to a tactical approach to get the best out of search marketing.
Should you be re-inventing the wheel here? Is this best use of your time learning and managing PPC campaigns yourself? Or would it be rather wise to hire an expert to do the job while you stayed on top of everything being done? Remember, I could teach a marketing manager within an hour how it works and what needs to be tracked.
3. Can A Marketing Automation Software like Marketo replace the experts and help you do it yourself?
Well, I would rather not comment on how far softwares can go today, but we often come across several inefficiencies and wastages when we Audit PPC Campaigns managed by other PPC agencies. If other experts can get it so wrong then I wonder what softwares can do with their limited intelligence that I know of.
His second argument is about time. Jon says that agencies convince clients with this argument about time:
“I’m too busy to manage search. It’s easier to pay an agency to take care of it for me.”
He goes on to explain this and I quote:
“The agency doesn’t understand your business like you do, so they can’t react to competitive changes or deal with new business initiatives as well as you can. The only things they can do without you are tweak bids, use tools to suggest new keywords, and generate reports – all tasks that automated software can do better and cheaper than a consultant can.”
Is that really all agencies can do without clients – tweak bids, use tools to suggest new keywords and generate reports? Who does the following Jon?
- Who brainstorms and defines the line of communication based on business strengths and goals?
- Who researches competitors and decides which keyword themes to focus on?
- Who writes text ads and their variations with different lines of communication?
- Who researches and creates keyword themes from various sources?
- Who decides what is the intent behind keywords and search term?
- Who analyzes at actual search terms and decides whether or not they are relevant to business?
- Who decides what keyword match types are ideal?
- Who does all the thinking behind using negative keywords?
- Who plans the ideal campaign and ad groups structure?
- Who designs and optimizes landing pages for better user experience and conversion rates? Isn’t landing page critical to B2B lead generation?
- Who does A/B testing on these landing pages to improve them for best possible conversions?
- Who defines remarketing lists and strategizes which audience to be targeted with what kind of messaging?
There is plenty more to this list. How many of these and how efficiently can your marketing automation software do? What is the learning for marketers to excel in all these areas and get the best out of their PPC campaigns?
Did you really think all that PPC agencies did was to tweak bids, suggest new keyword and generate reports? Even if this was the case do you really think your marketing automation software can do any of these better than a PPC specialist? Well bring it on. How about a test run of your Marketo vs my optimization on a campaign? Challenge accepted?
Why Companies Shouldn’t Outsource PPC Campaigns
Jon provides the following 5 reasons (first his argument in quotes followed by my counter argument):
“B2B transactions have a more complex sales cycle, involving multiple decision makers – each using search in different ways, with different motivations, and at different times during the sales cycle. An agency that works mostly with consumer companies may not have the proper expertise to deal with the specialized needs of B2B.”
- Thank you for conceding and explaining that B2B campaigns need specialized approach to PPC. For this very reason a marketing automation software could be way too far from replacing a PPC specialist. Also there is no shortage of B2B specialist PPC agencies so all that marketers have to do is hire an specialist agency for managing their PPC campaigns.
”Agency business models are focused on the largest spenders. Agencies are, by their nature, service businesses that are only profitable if companies spend $10,000 per month or more on search. (These minimums keep going up every year.) That leaves the majority of B2B companies out in the cold. Be wary of agencies that promise to provide reasonable service at levels below $10,000, since at those levels an agency can profitably give you only a few hours a month.” - Heard of PPC agencies working on fixed retainers Jon? We do and we do work with smaller budgets as well as deliver enough value in ROI to comfortably justify our retainer fee. Also we have different teams specialising in B2B and B2C. Sounds too good to be true? Well I am sure there are several others like us. Wish you had done some research about PPC agencies before making this poor narrative.
”One of the most important skills for PPC success is picking the right keywords that your prospects actually use when they search – something you know best.” - Are you really that stupid? Well here is a fun fact: Did you know 15% of search queries on Google are new, never been searched before? Do you think it is humanly possible for any company to get into the heads of their customers and know what exactly are they going to type to search? Google offers the Keyword Planner tool for a reason right? To search keywords your prospects might be searching for? Also there is a search term report in Adwords that shows the exact terms people typed to see ads? Don’t you think those exact keywords are discovered over time?
”Over time, the balance of power between business knowledge and SEM knowledge will shift even further towards business as Google continues to find ways to reward relevant content and discount search agency tricks.” - What agency tricks are you talking about here when it comes to SEM? Oh god did you refer to SEO tricks by any chance? While I agree that business knowledge is as important as SEM expertise but tell me How exactly do you think SEM knowledge will shift towards business? Unless of course someone started learning SEM.
In-house improves flexibility and the agility to react quickly. I recently met with one B2B marketer who was paying his agency a whopping 40% of his overall PPC budget, yet they were still bidding on words that were not converting to leads. All the back-and-forth emails and phone calls required to coordinate changes created latency and information loss. This meant it took weeks to get a new campaign launched. In contrast, his competitor who kept search in-house could launch new campaigns in under one day. It’s no wonder the competitor had better PPC results. - I haven’t heard of an agency that charged 40% of campaign budget or a client that paid such insane amount for campaign management. Also you have to find a really inefficient agency that took weeks to prepare and launch a campaign when it could be done in a day (did you really hire one from Mars?). We avoid all the back-and-forth with emails and phones calls using state-of-the-art project management softwares and our turnaround time is usually 24-48 hours. I am sure there are many other agencies that operate with this agility and if they don’t then they wouldn’t really survive in business for long right? As a marketer you could judge an agency on these parameters from their references, testimonials or pre-hiring conversations.
“Agency incentives are not aligned with your goals. When you outsource PPC, you give up control over how your money gets spent. Whatever your agency promises, their first incentive is to grow their own business – meaning they will usually tell you that search is performing great. This is the fox guarding the henhouse! It is up to you to put their information in the context of your overall demand generation strategy and to make the critical decisions about whether your marginal dollar is best spent on search or another demand generation activity.” - Those big ticket media-house agencies have their business goals aligned to make clients spend more money to earn more commission. However why should a marketer even consider working with them? The specialist PPC agencies like us take great pride in success that we deliver on campaigns we manage and that’s how we win more business.
Also, with a little bit of understanding about key metrics to track in real time (my 1 hour training could take care of this) marketers could precisely control budgets. There are alerts that can be setup in AdWords to send you email when something changes drastically. So I don’t really think that the client-agency relationship has to have those grey areas anymore.
Should You Bring Search In-House Purely Banking On Marketing Automation Software?
To be honest I am not against the some value marketing automation softwares bring to the table. If it does make business sense given your circumstances to hire in-house PPC Specialist with the experience and expertise you could get from a specialist PPC agency then it’s not a bad idea either.
However saying that marketing automation alone can replace expertise that PPC agencies bring to the table is far too fetched in insanity. Also it doesn’t hurt for marketers to learn basics of PPC marketing. We in fact prefer to educate our clients so they could understand and appreciate what we are doing to make their campaign successful.
In this particular case Jon Miller has clearly gone too far away in ridiculing the value of PPC agencies in an effort to make a case for his marketing automation software.
That’s a real desperate ‘Fox’ eyeing to steal some eggs out of your henhouse every month, for doing pretty much nothing.
