Should Marketers Outsource Search?

by Aaron Goldman, Feb 21, 2007, 3:30 PM

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In my last column, I covered the ongoing debate about whether or not search marketing is rocket science. Ultimately, I downplayed the importance of that issue and put the focus on the real question behind this hotly contested topic -- should marketers outsource search management to dedicated firms?

While the answer varies based on each particular marketer's situation, there are certain qualifying criteria that can help all marketers determine if they are good candidates for handling search in-house.

Gary Angel of SEMphonic takes a stab at this in his recent byline in E-Commerce Times. Below are three questions he advises marketers to ask themselves --along with my comments.

1. How important is the Internet acquisition channel to your business?

I dismiss this question as "not applicable." As I've pointed out  repeatedly in previous columns, search is more than just a direct response vehicle capturing "low-anging fruit" at the bottom of the sales funnel. Search is a platform by which new media delivery and consumption habits are being formed. As such, search has the ability to engage consumers across the entire purchase funnel, from awareness to interest to desire to action.

2. Is search marketing a core function to your business?

Now we're getting to the heart of the matter. For some companies (e.g. CPG, OEM) search is viewed as a marketing channel. For others (e.g., publishers, Internet retailers with vast product lines) search has deeper implications for their business. For these marketers, search is how consumers fundamentally interact with their brands.

Examples of the latter are Amazon and eBay. Search is truly core to these businesses. Amazon harnesses the key attributes of search via its algorithmic product recommendation engine. EBay's on-site search function and deep customer profiling provide tremendous proprietary online consumer behavior data -- another crucial component of advanced search marketing. For these companies, being search experts is not just in their DNA, it is truly a marketplace differentiator.

3. How well does search marketing fit your culture?

 Angel describes the business culture for companies that are good candidates to manage search in house as "analytic, measurement-oriented, technical, aggressive, and younger."

 I'd also add dynamic, forward-thinking, innovative, and media-savvy to the list. If your company thrives on having its fingers on the pulse of what's coming next and has internal processes built into the corporate hierarchy to leverage and capitalize on emerging media trends, then you are a good candidate for bringing search in-house.

 

So should all marketers that meet these criteria bring search in-house?

 

Angel points to two main reasons marketers outsource search:

1. Fear: "Lack of knowledge still leads many companies to believe that simply can't build the expertise in search marketing to manage a program themselves."

2. Resources: "Many organizations have a hard time staffing appropriately."

Angel suggests that both of these issues can be overcome and, ultimately, his recommendation is that "if you've been thinking about the possibility of bringing your SEM efforts in-house, there aren't necessarily any compelling reasons why you shouldn't."

 Well, I'd like to add a few.

3. Experience: Regardless of how long you've been in the industry, it's difficult to keep up with all the various applications of search -- PPC, SEO, clickstream analysis, retargeting, customer profiling, etc. Not to mention all the different search platforms -- international, local, mobile, content, IYP, paid inclusion, shopping feeds, etc. Very few marketers today have experience across all these platforms. Most search agencies, however, have successfully tapped these channels for one client or another and can apply those learnings without the "trial and error" that a marketer doing it for the first time would face. Additionally, staying on top of emerging trends, evolving algorithms, new technologies, and best practices can be tough without exposure across a diverse range of marketers, objectives, and results.

4. Technology: As all search marketers know, technology is crucial for automating parts of the campaign management process and tying together disparate sources of data for holistic measurement and analysis. Some search firms have proprietary technology that would take a great deal of time and budget for any marketer to build for itself. However, as Angel points out, "most agencies aren't using in-house [technology] solutions. When they are, the solutions are usually worse than the commercial solutions available to anyone." While that may be true, this underscores the importance of...

5. Scale: With few exceptions, if a marketer wanted to manage search in-house using a "commercially available" search technology, it would be more expensive than if it tapped that same technology through an agency. Agencies are able to secure discounted pricing based on sheer volume aggregated across clients. Additionally, this volume affords agencies dedicated resources assigned to their accounts for troubleshooting, training, etc. The same goes for the search engines themselves. Firms that manage large search media budgets across multiple clients reap the benefits of dedicated staff and inclusion in advisory councils, beta releases, etc.

6. Flight Risk: Let's say a marketer is able to overcome all the issues above and/or renders them moot. Any marketer building an in-house search team runs the risk of having all the knowledge walk out the door with one or two key individuals if they leave the company. We all know how strong the demand is right now for folks with search experience. And, while agencies are certainly not immune to employee flight risk, the risk is mitigated by the relative ease with which team members can be reassigned and ramped up quickly and efficiently.

Ironically, one of the arguments I've heard recently is that search is just "too important" to leave in the hands of an outside party. For those who have been involved in search since the early days, it's quite gratifying to hear these words. For so long, search firms had to fight to get a seat at the table. Now, in some cases, that seat is being reserved for family members only.

It's reminiscent of the struggles of the larger online advertising community clamoring for share of marketers' minds and budgets in the late '90s and early 2000s.  Clearly, that effort was successful -- but you don't hear a lot about marketers building in-house online advertising practices. So why should search be any different?

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