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Agency Management and Expertise

Last week I enjoyed reading Andrew Goodman's SEL piece on The Death of Search Marketing Expertise. For those of you who haven't read it, Andrew laments the lack of knowledge/expertise among modern agency owners.

Andrew's hypothesis is that this is a result of agency owners caring more about the growth of their business than the "craft" (my word) of marketing. Which I think is probably true.

This leads to a worse level of service for the agency's clients because the owner sets the culture. So the employees of the agency don't get the mentorship and development they need to grow in their roles.

On Twitter, my "in group" are PPCers who are at the "craftsman" end of the spectrum (out of the industry as a whole this is a minority). Andrew's piece is like catnip for us because the "clueless idiot who makes a tonne more money than me" is always a good out group to position against.

But no matter how much we dislike it, I think the clueless agency owner is here to stay:

  • Assume there is no relationship between PPC ability and ability to run an agency. If you plotted these two axes on a chart (too lazy to actually do this for you - sorry) you wouldn't see any correlation.
  • Now assume that to be successful as an agency owner your agency running skills + your PPC skills must be above a threshold. i.e. if you have AMAZING PPC skills you don't need to be very good at running an agency or vice versa. This assumption is false, but might be useful
  • Exclude everyone below this threshold. Going back to our imaginary scatterplot, this removes everyone below a line that slopes down from the top left to bottom right
  • Among all the people remaining there is a negative correlation between PPC ability and agency running ability. (!!)

Asking if this is good or bad for the industry is like asking if the spinning jenny was good or bad for the weaving industry in the 18th century.

The industrialisation of textile manufacture was bad for artisan weavers (i.e. all weavers prior to about 1740) but it lead to a much larger industry and cheaper/better cloth for consumers.

PPC is now out of the genesis phase and is moving towards commodotisation. People like me are trying to convince clients that they need "artisanal PPC" delivered by a craftsman - in some cases this might even be true. And I honestly believe that there will always be a market for this kind of service but it is currently a shrinking market.

I'm perhaps abusing the word "craftsman" here. The origin of the word refers to people who have done a 5-9 year apprenticeship and at least one year as a journeyman.

 

The pressure towards a commodotised service is inevitable, but for PPC the change is accelerated by the engines. "Commodotise your complements" is good strategy and one of the complements of a robust search advertising revenue stream is a whole bunch of agencies to help clients spend their money.

Comparing PPC and SEO is illustrative here - I think the commoditisation of SEO is happening and is inevitable but the pace is a lot slower because it is not being driven by the search engines. If anything, changes to the algorithm over the last few years have made the commodotised approach less effective.

Authored by Richard Fergie