Outsource or keep search engine marketing in-house?

When selling our services as a specialist Pay-Per-Click (PPC) agency we often encounter the same question from our potential clients: Does it make sense to outsource my PPC advertising management?

Whilst there’s no black/white yes/no answer to this question, and companies like First National Bank have gone in-house, understanding the shades of grey can better equip your company to make the smart move. The crux of the argument revolves around answering the following questions about your own company:

• Can our in-house team do the job well?
• Can someone else do the job better?

When thinking about the first question you need to consider the medium you’re dealing with and the market you’re in. The European market, for example, has undergone massive growth in online spending and, therefore, skills related to this medium have grown at a similar rate to manage it. All of Google’s biggest spending clients in that region are run by agencies who have invested time and resources into having a specialist PPC team.

In Africa, the uptake on programs like Adwords has been much slower than expected and therefore the skills to manage these programs are in short supply. What this skills shortage necessitates is that those with the skills will need to use them across clients in an agency environment.

In short, the most skilled operators in this game are best utilised across many companies and caution should be exercised when meeting a “skilled” operator who is willing to work in-house.

In addition, as the industry matures, the level of complexity necessary to optimise for size and efficiency will grow beyond what most companies are willing to invest in an internal team.

According to the argument above, the answer to the latter question is always “yes”. The smart choice, then, is to make sure their services produce greater value at a better price than the investment cost of creating your own team.

Consider the following metaphor: I need to manage my debit orders and account payments every month. When I was a student, I didn’t have that many payments to make, so I handled all of them myself. Now that I’m a busy, qualified professional I don’t have the time or the inclination to ensure my bond, car, DSTV and other payments came off my account; never mind filling out my own tax return. At some point during my life, outsourcing this task became the smart decision to make.

Similarly, with PPC advertising, if you have the right combination of in-house expertise, tools, bandwidth, and a marketplace where you can compete effectively with those tools, then in-house might make sense.

If, for example, you’re finding that you or your marketing team has to direct the keyword strategy, the regional targeting or the bidding strategy – that’s a clear indication that your chosen agency is a dud.

One reason outsourcing might fail is that while there are operators who can definitely do a better job than an internal team, they might not be skilled or incentivised enough to do a great job. Quite a few “skilled” agencies are merely using the same tools that are inherent in the advertising programs, and are renting out their operators on a time basis — merely setting up the accounts and reporting on them month by month.

In this regard, having a performance model in place like a Cost-per-Lead or a Cost-per-Sale/Acquisition not only incentivises the agency to do a better job, but it also informs you as the client as to how skilled (or not) the agency is.

If, for example, you’re finding that you or your marketing team has to direct the keyword strategy, the regional targeting or the bidding strategy – that’s a clear indication that your chosen agency is a dud.

With the above warnings in mind, let’s consider some aspects of the right way to go about outsourcing your PPC.

• Doing your homework: Knowing who the best players in the industry are – they’re the ones who have a well built up client base; they’re the ones who win the best campaign manager, best campaign, best of show and agency of the year at their industry awards events; and they’re the ones willing to go on a performance model to show they’re the best.
• Trust: The agency you chose has better tools than you could build or rent. This involves the recognition that they have tactical expertise and experience beyond that of your internal team.
• Expectations: Know what you want to achieve from your online presence – are you looking for visitors, leads, sales or for some kind of other engagement with your brand? Once you know this stuff it’s great to let your agency have access to this data – so they know where they’re going wrong and what they’re doing right.
• Internally: There shouldn’t be a need for a full time employee to be hired to shepherd your SEM agency around unless you’re spending double digit millions on your Adwords account or your agency is a dud.

Overall, it’s hard not to sound like Dante’s Inferno but the three levels of PPC enlightenment read as follows:

In worst place: Hiring a dud PPC agency on a retainer fee that creates an account and reports on it every month.

Second place: Hiring an under-skilled in-house PPC team that is close to your company and it’s expectations but couldn’t be further from the core skills and technology required to produce the real value.

First place: Hiring one of the best PPC agencies in the field on a performance model. That way their incentives are aligned with the success of your business, they’re close to what makes your business tick and they present more value than going in-house.

Image:microedge.co.uk