Antony Yiu | October 10, 2011
I confess that I love search to a point I am a bit obsessive about it. There are just too many new and exciting features released by search engines, as well as more cool third-party tools beyond bid management software available to make search more scientific than ever. As search talents in Asia Pacific become more experienced and more tools are available to automate some of the tedious processes, I have heartache every time I hear advertisers complaining about the inefficiency of their search campaigns.
In the past 12 months, I have witnessed a significant change in the pitches that I attend. Gone are the days that agencies need to spend time justifying why search should be in their media mix. Instead, advertisers are looking for more sophisticated strategies to help them deliver performance, whether it is an increase in ROI or improvement in CPA. Advertisers have gradually moved away from looking at their campaign success purely on CPC or CTR. As search becomes more performance driven, advertisers should start evaluating whether their current search agencies are actually helping them leap frog to the next phase of search development.
Here are some quick tips to help you evaluate whether your existing search agency is up to the notch or not:
1. Bid management tools are not everything.
With an increase in popularity of various bid management software including Omniture Search Center, Acquiso, Marin, Kenshoo, Mediaplex, and many other propriety ones developed by agencies, advertisers are wooed by the “magic” that tools can help bring to their search campaigns.
Bid management tools can definitely help reduce the time and manual work that you need to manage your search campaigns, especially if you are running numerous campaigns simultaneously, covering multiple product lines or properties across a number of markets.
Before you hear any more black box magic by the salespeople, all of the bid management tools have very similar functionality, i.e. to adjust bids automatically based on your KPIs. Bid adjustments are usually carried out by either rule-based or algorithm-based, which utilises historical campaign data to do predictive analysis and adjust the bids accordingly. Some more advanced bid management tools will go a step further and can create new keywords, dynamically generate ad copies and site links, detect sold-out inventories, and of course, real-time reporting. All technologies are based on the ability to channel data with various search engines and media channels via APIs, and the utilisation of cookies to track users’ action.
Bid management tools can only start working after you set up your campaigns. That is the part that search professionals come in. Your agency should be able to give you a concrete strategy to set up your campaign including:
- How should you breakdown your campaign into account, campaign, ad group level?
- Do you need to create separate accounts or campaigns by countries, channels or devices?
- How should you assign different budget for each account and campaign?
- Which search engine or languages should you run your ads?
- Should you create keyword phrases that combine the use of two languages? For example, in Hong Kong and Malaysia, it is quite common for searchers to type in a search phrase using both local language and English.
2. Keyword bid price and match type adjustments are not sufficient.
Needless to say, keyword bid price and match type need to be adjusted on ongoing basis to drive performance. These two tasks have partially been taken care of by the bid management tools. However, if your agency runs the same set of keywords for months without adding new keywords, negative keywords, and without adjusting the ad copies, this should be a warning sign that they are not doing their job properly. Search agencies have a role to monitor the search trends and keywords phrases used and propose any changes accordingly. For example, if your competitors are running a new campaign and pushing new phrases such as LED TV and SMART TV, your agency should actively propose new keywords phrases to capture the change in search landscape. Search should not be operated in silos. Your agency should look at what phrases people are using in various social networks, blogs, discussion forums, and alike, as well as the new ad copy tactics being used by your competitors. Bid management tools won’t be able to change your ad copies based on your competitors’ activities, as well as the new words being used online.
3. Search agencies only focusing on what they are paid for is not enough.
Regardless whether your appointed agency is only responsible for doing SEO or SEM, if they don’t take a step further and ask you for your overall media plans or your web analytics data, you need to start having doubts. It is not uncommon for clients to use different agencies for SEM, SEO, and media buying and planning. Nowadays, media agencies must work with creative agencies to come up with a successful campaign. Similarly, your search agency should also work with your media agency, your search and web technology partners (Ominture, WebTrends, Google Analytics, Hitbox etc.) to propose an ongoing optimisation strategy that can bring all facades of media in sync with one another. A quick and easy way to see whether your search agency is doing their job properly is to look at how they plan their monthly and daily budget in search campaigns. If they ignore your overall media activities or your SEO performance and simply set the same daily budget throughout the entire campaign period, it will be a signal that they are not really doing their work properly.
5. Search agencies that only know about search is not enough.
Granted, not every agency has experience in running campaigns in every single industry. However, you need to see whether upon appointing your search agency, they go a step further to start learning how you operate your business, as well as try to figure out the overall competitive landscape. For competitive landscape, it is more than just running ongoing competitive reports, which most media agencies are doing nowadays.
- Is your search agency actually taking what it has compiled in the competitive reports and turn them into useful recommendations that can further drive your campaign performance?
- Is your search agency monitoring how user and search behaviour are changing in your industry and proactively proposing new ways to help you achieve your KPIs?
5. Increase in CPC is not a valid reason to ask for more search budget.
If your search agency is simply using the increase in CPC as an excuse to ask for more search budget, it is high time you find another agency. This happens because many search agencies still charge their clients a percentage of media spend as commission. Though, it is undeniable that as advertisers are spending more on SEM, they will compete more fiercely with you on the keyword bid price. However, a recent benchmark report by Marin points out that the average CPC on Google AdWords only increased by a mere 2 percent YOY; the report highlights that “search marketers took steps to improve efficiency”, which led to an improvement in CTR without a substantial increase in CPC. Your search budget should only be increased if you are seeing an increase in ROI or an improvement in CPA. Just like the law of diminishing marginal returns, as your search budget continues to increase, you will eventually reach a point that each additional dollar that you put in search, you will get less than what you receive before in return. Advertisers need to make a judgment call to determine whether any incremental budget in search is still more effective in achieving its KPIs compared to other media channels.
As the year comes to an end, advertisers will start evaluating the efficiencies of each media channel in achieving its KPIs throughout the year. These five tips on selecting search agencies are not meant to be exhaustive but merely serve as guidelines for advertisers to start pondering whether their search agencies are doing their jobs properly.