Getting The Most Out Of Your SEM Agency

Should we use an SEM agency or take it in-house?

The recent trend to pull search marketing in-house has generated more than a few articles on this topic, so I thought I’d put an industrial strength spin on it. Here, I’m not going to contemplate whether you should use an agency or not, but rather how to use your agency (and how not to) in order to extract the most value from them.

At Yahoo!, we try to use an SEM agency in businesses for which we think it makes sense. In these businesses, we are solving what I would call ‘generic’ search marketing problems. Bringing users into our properties to subscribe to our services is the goal here. Yahoo! markets web hosting services, online dating services, even search marketing services in this manner. These are easy to outsource because they follow a basic impression-click-conversion pattern. If you can track your conversions with a third-party pixel or javascript tag and translate those conversions into a quantifiable value, you should definitely consider using an SEM agency.

Play to their strengths

Use your agency for things that they are good at. Leverage them for campaign management and optimization. Have them do lots of creative testing if they have the resources. Last month I wrote a column on planning and reforecasting. This is a great use of agency resources. Have them bring competitive insights to you. They probably see more of the industry than you do, so they can likely help you see how you’re doing versus others in your space. Landing page testing is another task that is well-suited for outsourcing. Agency SEM managers are often adept at evaluating landing pages once you’ve created them.

A Note on keyword expansion

Some agencies are good at keyword expansion and others aren’t. One tip I have on this is that if keyword expansion isn’t your agency’s specialty (or even if it is), use your existing assets to grow your keyword portfolio. That is, if you have a search box on your site, see what users are searching on and use that. If you don’t have a search box, see what other keywords your users are searching on to find your site and test them out. What searches are driving organic leads to your site? Don’t be afraid to buy these, especially if they convert.

Pick your battles

While using an agency can save you resources, you can’t always use them for everything. I’ve made the mistake of trying to put agencies on specific businesses where they lacked expertise. That did not go very well, and in each case we ended up pulling the program back in-house after a good deal of frustration. In addition, sometimes your SEM programs are tied so closely to your business that they can’t easily be outsourced. Examples of this are businesses where the value of a conversion is highly variable, or where the conversion itself can only be tracked through internal systems. In one sense, this makes it much more challenging, logistically, to engage with an agency. In another sense, managing the business of SEM for such a property can require very specific skills that your agency may not have.

Weeklies, QBRs and feedback

Because we have multiple SEM advertisers at Yahoo!, it’s important to make sure that each one gets the right level of service from our SEM agency. Over the past year or two we’ve put several processes in place to make sure we’re on top of this. First, I have weekly in-person meetings with my agency account team where we review every business under their care. Second, every quarter the agency conducts a quarterly business review (QBR) where we look back at last quarter’s performance and look ahead to projects for the next quarter. This is the time to bring in competitive insights and deeper analysis of the metrics. We don’t conduct QBRs for every internal business, mostly just the larger ones. Finally, after each QBR we actively solicit feedback on the agency’s performance. We ask for a numerical rating as well as qualitative feedback. After the feedback is collected, I work with the agency to open action items that will address any negative issues that came up in the feedback, and we evaluate progress against those items the following quarter.

Making good choices

Having worked for SEM agencies in the past, I can tell you that the most important assets an SEM agency brings to the table are a) good technology and b) smart people who work hard. Outside of these basic requirements, its really up to you, the advertiser, to create a relationship that makes sense for you and your business. To review: Use SEM agencies to solve generic SEM problems. If you have SEM needs that are very specific to your business, pull them in-house. Where you do engage with an agency, meet in person weekly, review the business quarterly, and evaluate their performance and insist on results.