Is Search Engine Marketing Dead? Will Agencies Become The New DSP?

MagnifyingGlass-SearchSearch data will integrate with a variety of media channels, changing the way demand side platforms (DSPs) support online advertising and increase the return on investment (ROI) on campaigns. After all, DSPs provide the technology connecting the ad-serving process. At MediaPost's Search Insider Summit Saturday, Matthew Meadow, search associate media director at the agency Draftfcb, led a discussion to reveal the future of search and the role of DSPs with panelists Frost Prioleau, CEO at Simpli.fi; David Rodnitzky, CEO of PPC Associates; and Jonah Spegman, director of digital media marketing at Scripps Networks.

Paid search will continue to become part of a broader digital marketing strategy where consumers buying goods and services interact with multiple types of media as they make purchase decisions. In 2011, search engine marketers watched as companies such as Simpli.fi grew stronger, and IgnitionOne (SearchIgnite at the time) broadened its focus from paid search into display, allowing the company to gain a complete view of how each piece performs through DSP technology. That plan is likely to expand to include social media in 2012.

In the Forrester research report titled "The Future of Digital Media Buying," analysts Joanna O'Connell and Michael Greene explain the changing media-buying landscape as it pertains to display advertising. The strategies tapping new technologies, DSPs, and audience targeting appear similar to search-marketing tactics. The analysts write that "the most successful exchange buyers look a lot like search engine marketers wearing a display hat, in that they" make data-driven decisions, embrace performance-based buying, and optimize campaigns in real-time. 

Providing insight into Scripps' segment targeting strategy, Spegman said typically a brand's company owns the most important data. Spegman has the good fortune to work for a company with a variety of owned-and-operated sites he can pixel and take the data to the ad exchanges. So a better approach to renting third-party data remains buying strategic sites, placing cookies in the browsers of visitors exposed to the ads on those sites, and using that as a way to run data, rather than commoditize it.

Meadow points to the lack of "granular" reporting when it comes to working with DSPs. "Being an obsessive and compulsive data freak, I can't get around that because I just want to dig deep, deep, deep," he said. 

Most search marketers believe keyword-level bidding remains the key to a successful paid-search campaign. Find the keywords that work and the pot of clicks and conversions appears on the other end. But DSP providers believe in other methods too.

Simpli.fi supports keyword-level bidding -- that along with instant search retargeting, which Prioleau defines as serving an advertisement to those who have searched on content based on the prior ad impression, could have four to 10 times the click-through rate compared with impressions served a week later. "The computer must be more than human on the other end," he said -- because it tells the marketer not when a keyword works on a site using a specific creative on a particular time of day, but when it doesn't, and why.

It turns out that DSPs have the data to offer alternative marketing suggestions. Spegman said the DSPs he works with give him the "keys to the ignition to drive the train," and thus help correct some of the rudimentary and simple decisions a machine might make.

Search marketers have a talent to digest large amounts of data to make real-time decisions, so the trend for media to become more biddable will capitalize on it best, Spegman said.

Not all agree. Rodnitzky believes change is coming for today's DSP model. He compares DSP technology with electronic stock trading platforms and believes that the current iteration of DSPs remains in trouble, and they will need to evolve. Access to the data allowed them to disrupt Charles Schwab and old-school companies. Today, banks give away the access to the research for free. This pushes the trading desks into a corner, where they have to change less and less. This increasing margin compression, along with Google's acquisitions including AdMeld, will potentially provide access to "incredible" data.

In this rapidly evolving space, the role of technology and agencies will change. Spegman believes DSPs will become agencies. They will move away from the core focus of providing ad technology and offer more professional services.

Rodnitzky, who tried to build a search algorithm in 2006, points to the complexity of working with multiple companies as the biggest challenge these days. On the other hand, he can't see one company being good at everything, either. The complexities will require an agency to have a vertical expertise to support clients. "There's no way a search marketer will be an expert in social, display, mobile, video and voice," he said. "Search engine marketing is dead because you need to also know [the rest]."

Tags: dsps, search
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1 comment about "Is Search Engine Marketing Dead? Will Agencies Become The New DSP?".
  1. Kevin Lee from Didit , December 12, 2011 at 2:28 p.m.
    We actually have found that we get the best reach and performance as a MEtA DSP (Logically that shouldn't be true if the systems were in fact fully functional and transparent). However, API-level integrations with DSPs have provided significant flexibility and redundancy simultaneously. More complex, yes. Worth it? DEFINITELY?