Commentary

Fear of the O-Word, Part 1

Meet "Rohit." To some, he's a savior. To others, he's an anthropomorphic nightmare. If you work with him, you probably don't want to talk about him, and if you don't work with him, you probably need to know more about him.

Rohit runs a company in India that handles search engine marketing outsourced from the U.S. He's not willing to share his real name or the name of his company with the press. Due to non-disclosure agreements (NDAs), he cannot disclose the names of the leading SEM firms who employ him and his fast-growing company.

He can, however, share insight into a controversial subject that most people are afraid to discuss, especially on the record. The transcript of our recent conversation spanned thirteen pages; in this two part-series, you'll read excerpts about the work Rohit's company handles, why everyone's scared to openly talk about it, and, in Rohit's opinion, why there shouldn't be any panic in the U.S. about all interactive jobs heading overseas.

Ready or not, here he comes.

Rohit: We are an agency based out of India and are a full-service search engine marketing firm. My business model is outsourcing. We are currently working with large SEM agencies in the U.S. who either hire full-time resources from us or outsource projects in full or part to us.

Search Insider: Here's a hypothetical question. Let's say I ran into the head of a major SEM agency who happens to be a client of yours. I don't know this when I approach him, but I happen to ask, 'Hey, you guys are taking on a lot of business, but you're only 40 people. Do you outsource any of it abroad?' How do you think he'd respond?

Rohit: Many agencies are today outsourcing a lot of their processes to companies abroad. They may not accept that, but I can tell you many companies do outsource. Secondly, I do not see why it should be of any concern. I know the whole question of outsourcing has become a big political debate, but we both know that's how the business will operate in future. It's smart outsourcing that will win the day for any serious business entity.

SI: Why do most of your clients require signing NDAs? Why are they so eager to keep this hidden?

Rohit: I understand where you are coming from--and that's true. Most agencies use outsourcing today in the interactive industry for two reasons: 1) to increase their operating margins, and 2) to tap the knowledge resource. Outsourcing is still not very open in the interactive space as it is today in, say, software development. In software, clients ask for it quite openly. They look for an onshore + offshore model so they have someone locally to interact with clients. I am sure that's going to get replicated in the interactive space too.

SI: So I'll ask you again, why isn't it so open in interactive? Why are software companies fine discussing it while interactive companies stay in the closet?

Rohit: First of all, in terms of size, the industry is still growing up. I believe it still has not become as big. Secondly, since the barrier to entry is presumed to not be very high, many small shops have started doing SEO and SEM, so it's still fairly unorganized.

SI: What do you think U.S. companies should know about outsourcing? What points do you want to make sure MediaPost's readers, largely based in the U.S., understand?

Rohit: First of all, one has to understand, marketing is the most important variant for any small, medium or large business entity. It's the communication between and you and your target, so one cannot obviously play around with it. But if marketing has been outsourced to agencies locally as we always do in the case of ad agencies, interactive marketing is just another medium, and it's absolutely as possible to outsource it to an agency offshore as it is to an agency onshore.

But one has to know and understand your outsourcing partner carefully. In software development the mode of communication is technology, but in marketing the mode of communication is technology and cultural know-how. If I, sitting here in India, do not understand what a U.S. customer will look for, I will not be able to justify my role as a marketer. Cultural know-how is absolutely important.

SI: So what's really being outsourced to you? Is it the technology, or the marketing too?

Rohit: Well, both. One cannot generate value out of interactive marketing as an outsourcer if he is not open to outsource both. Our kind of services are heavily integrated between technology and marketing.

SI: So it's more than just the optimizing keywords.

Rohit: Yes.

SI: With search specifically, what parts of the marketing do you cover?

Rohit: Strategy, analytics, copywriting, media buying, optimization, PPC (pay-per-click), reporting...

SI: And with analytics and reporting, you're talking not just reading charts and reporting metrics, but the real intelligence behind the data?

Rohit: Yes, absolutely... analyzing the server logs, not just the NetTracker or WebTrends reports.

SI: And with copywriting, how is it you have skilled copywriters there? That sounds baffling, in a way, that you'd have as skilled copywriters in India as you'd find in the U.S.

Rohit: Yeah, absolutely. If you talk about our agency itself, we have a team of copywriters. There is a proper process we follow. It's not just picking up a project and optimizing it. I can tell you, some of the best brands' websites are being worked on by people out of India. I am not trying to exaggerate things, but these are some facts, and the sites are doing wonderfully well on the search engines.

* * *

As the conversation initially picked up momentum, Rohit wrote, "In a way, you have raised some concerns for me." He rose above these concerns to open up a dialogue, even if it's started by one who hides his name. Next week, he shares his thoughts on politics and the risks of outsourcing.

In the meantime, thank you, Rohit, for overcoming some of your fears, and even more importantly, for sharing them.

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