If Big Ad Agencies Can’t Handle Search Engine Marketing, What’s A Small Business To Do?

    July 15, 2004

A recent online news article entitled “Five Reasons Why Ad Agencies Hate Search Engine Marketing” struck a responsive chord in the search engine marketing (SEM) community. Lots of posts, both critical and supportive, showed up in online forums. The article made some points that I have noted myself in previous articles. The most important ones are that good SEM is labor intensive and expensive, that profitability is hard to achieve, and that the search engine companies keep moving the goal posts. I think it’s worthwhile considering the extent to which these problems also impact localized search engine marketing.

Naturally, the search engines themselves, for example Google and Yahoo, have evolved with an eye to the big, national customers. Given that background, they have developed tools and systems in the PPC arena that seem to assume the end user, whether an ad agency or a small business owner, has lots of time and resources to work with the tools. Anyone who has even dabbled in the administration of keyword bidding on these search engines knows how complex it can quickly become. Hence, the system is stacked against the small business owner from the get-go, because he or she does not have the time or resources to administer these programs. The author of the article asserts that a camapaign of $50,000 per month is necessary to turn a profit on paid search advertising. While I would question the universal validity of this statement, it does highlight the time and resources dilemma of running a successful paid search program.

Why is it so complicated to run a good PPC campaign? At bottom, because the model itself requires the advertiser to get inside the head of the consumer in an unprecedented manner. As an example: an important key phrase for my own business is “web design.” So, I bid on this phrase. (This concept itself, “bidding” on a keyword, is a truly alien advertising concept to most small business owners I know). And every day, I get visitors to my website who are interested in “web design.” But does this mean they want to hire a web design firm? Who knows. Maybe they are writing a term paper. Maybe they want to steal some ideas. Maybe they are the competition (or worse yet, a flunky hired by the competition to click on the other guy’s ads). Maybe, maybe, maybe. But I’ve spent my money, and taken my chances. Now, of course, there are lots of ways to hedge my bet. Keyword suggestion tools, bid management tools, etc. But that’s where the time and expense comes in. As a small business owner, I can’t afford much of either. Controlling for the variables is what makes this kind of search engine marketing prohibitive for most small businesses. As an alternative, the various IYP programs offer a more targetted audience for the advertiser, as well as stable pricing and predictable placement. IYP is also a model that small businesses recognize, because of the crossover from print. The search engine audience may be larger, but the IYP audience is surely more qualified.

The other major point that was made in the article, besides the inter-related points of expense and profitability, is that the search engine companies themselves keep changing the rules, thereby making a tough job almost impossible. Absolutely true. It seems that Google and Overture come out with a new option, and a new set of rules, almost every day. Of course, it’s not really every day – it just seems that way to those of us laboring to keep up with the field. What is most irritating is the feeling that they are doing this to keep up with each other, not to benefit the consumer or the advertiser. These competitive forces do little to help the industry mature, a phenomenon we have seen many times in the high-tech arena. Again, it comes down to resources – if the big ad agencies are having trouble keeping up with the changes, can the small business hope to adapt? Not really. Not until the dust settles, at least.

One facet of search engine marketing that holds some hope for small local businesses is search engine optimization (SEO) with geographic modifiers. In this scenario, the optimization of a website for organic search is made infinitely easier if a geographic term is added. For example, optimizing for the term “chiropractor” on a national level would obviously be useless; optimizing for “chiropractor, CT” has been successful in giving one of my own clients an excellent ranking on Yahoo, achieved through fairly basic SEO. Even here though, there are limitations. It may be difficult for the small business owner to find good SEO. And even geo-modified SEO is only good for certain categories: “attorneys New York” entered on Google brings up a plethora of entries that are obviously highly competititive. It depends on the industry, and on the local market in question.

It was high time an article like the one in question was published. Search engine marketing, and website promotion, is an absolutely chaotic, immature discipline, made worse by the get-rich-quick scams that are littering the Internet. Choices for small businesses abound, but they must be made very carefully. One project currently in development here at Small Business Online, http://www.SmallBusinessOnline.net is a website promotion model that approaches the problem from the opposite end – the consumer. If the advertiser can’t reliably and consistently place his message in front of the right consumer, then perhaps the consumer needs to be directed to the advertiser by a different mechanism. At Small Business Online we are working on a program that will cost-effectively help drive traffic to specific advertising. Certainly, as the shortcomings of SEM via the major engines are scrutinized, more creative methods for linking advertisers with consumers in a cost-effective manner will eventually bubble up. In the meantime, the small business needs to keep in mind that if Madison Avenue is struggling with SEM, then it’s fraught with risk. More than ever, caveat emptor should be the rule.

Neil Street is co-founder of Small Business Online, an internet
marketing and web design company
, based in Norwalk, CT. Email Neil at Small Business Online
or call him at 203.299.0889