5 tips for selecting a paid search agency

Companies will spend over $35 billion on paid search marketing this year, and many advertisers spend hundreds of thousands to millions of dollars per month on keyword campaigns. Search has become an incredibly complex and competitive industry, where minor mistakes can lead to significant revenue losses.

With such high stakes, marketers often turn to agencies to help them manage their paid search programs. These agencies run the gamut from small shops that do simple keyword bidding and campaign management, up to integrated digital agencies dedicated to managing all aspects of multimillion-dollar online advertising programs for large brands.

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Selecting the right agency is critical. If you don't find an agency with the right "fit" for your brand -- on a technical, operational, and philosophical level -- your paid search programs will suffer. Working with the wrong agency could lead to campaigns that don't fit with your business and branding goals, which will result in lost sales opportunities, potential long-term damage your brand, and wasted resources.

Before you begin to search for a new paid search agency, ask yourself whether you need an agency to run your entire search program -- from strategy, to set up, management, bidding, optimization, measurement and reporting, and ongoing services -- or whether you just want an agency to run a piece of your paid search program, such as just managing bidding and optimization. If you just want an agency to run a piece of your paid search program, but will manage the majority of it in-house, you'll probably want to select a smaller, local agency.

However, if you're looking for a strategic agency partner to run a large-scale paid search program for one or more brands, then you'll need to conduct a comprehensive search to find the right agency. You need to ask each agency the "hard questions" -- and if they can't answer, they aren't up to the task of running a large-scale search program. Here are five questions to ask prospective search agencies.

Do you focus more on strategy or execution?
Your agency isn't just there to execute on a plan for your business; it should be your partner in developing, furthering, and attaining your core company goals. Make sure your agency has a method in place for helping you devise and reach key revenue and business objectives -- instead of just focusing on the nuts-and-bolts of bidding.

How do you measure long-term customer value?
Your agency should think of each of your customers or potential customers as its own -- and have the technical, marketing, and messaging strategy expertise to use paid search to cultivate a long-term, revenue-generating relationship with each one. Does the agency focus on a single transaction model to acquire new customers via paid search, or instead build value with each new acquisition over the long term? Make sure it has a strategy to build customer lifetime value from first-click through to repeat sales.

How will you improve my existing programs?
Asking an agency this reveals two primary factors. First, how well it understands your business, current efforts, and the vertical you operate in. Second, it showcases the expertise of the agency. As mentioned, you want to make sure your agency is aligned with your objectives and seeking its perspective upfront lets you know how much of a fit it may be and how much effort you'll need to invest in getting it up to speed on your business and industry.

Which technology platforms do you use?
There are a wealth of sophisticated, robust advertising management solutions today that can make the difference between an ad-hoc paid search program, and one that's highly optimized, meets, or exceeds ROI goals, and continues to achieve acquisition, sales, and branding targets. Find out which tools the agency uses, but also make sure it is adept at using them to get optimal results. You want to make sure your agency's teams aren't wasting valuable time on execution, and are instead focusing on building your business through strategic campaign planning and optimization.

Can we see some references?
Always contact a few brands the agency works with to ask them specific questions about their experience. Find out what it's like to work with the agency on a day-to-day basis, and what exact value it adds on a strategic level.

Finding the right paid search agency shouldn't be left to chance. Make sure you don't just have chemistry with your external agency team, but that it can provide thought-provoking, innovative responses to each of the above questions.

Matt Lawson is the vice president of marketing for Marin Software.

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