Google Adwords Overwhelms me!

A small business owner (small~ less than 20 people, less than $30 mill annual revenue)in 2004 could run an adwords campaign by himself and make a decent bit of profit. Now - that is IMPOSSIBLE.

We bagged an important online retail account last week. The client is one of the largest online jewelry stores in US. I asked their CEO why he considered outsourcing PPC advertising management (given the fact that the campaign was being managed in-house for the past 4 years and PPC remains the most important customer acquisition channel for the company). He put it in simple words - " Google adwords overwhelms us".

I could not agree more.

Google has been introducing changes in adwords at a rapid pace (rapid is probably an understatement, here). And, a lot of this has been prompted by Google's drive for "dis-intermediation". Google wanted to give all the tools a marketer might need to manage his campaigns in-house. But, they overlooked the fact that all these tools actually made the campaign management process much more complex - making it even more important for an advertiser to take SEM Agency help. Had they understood the market - on an overall level a bit more, this might not have happened.

The market scenario is this -

1. There are VERY VERY FEW (read 1 in 1000 people who claim that they do SEM) who are really good in PPC campaign management. And they are more likely to be working for interactive agencies or SEM agencies or big companies. The demand supply scenario is totally skewed - demand outstrips supply by a wide margin (and thanks to Google, the gap between demand supply continues to increase)

2. Even the interactive agencies and generalist SEO companies are struggling. In the past 3 years, companies (and people -- calling themselves "consultants") had jumped in the SEO/SEM space. It seemed such a no-brainer business to generate good returns from. The entry barriers were miniscule, businesses were diving into SEO/SEM like crazy and  because marketers were ignorant about SEO/SEM, any gibberish on "meta tags and quality score" had a "WOW! Effect".

However, this was too good to last long.

Agencies simply failed to recognize the importance and value of the most important element(or, entry barrier) in this industry - KNOWLEDGE.

Most SEO agencies got one guy trained on adwords (or maybe hired one guy who knew adwords). Then they tried to build a team around the "in-house adwords guru". (Google introduced Google certification and this made life even simpler for "self sworn gurus").

They often neglected two very important things - 1) in a mad rush to join the client land grab they neglected the importance of processes and systems - hey this was a new industry getting built and to expect that you could win the game without processes is STUPID 2) they underestimated the fact that they could get hit as well by an adverse demand-supply equation. The IN-HOUSE adwords guru, one fine day, got an offer from a big agency ,and left... taking 70% of the "captive" knowledge base with him... and leaving the agency stranded

To compound the agony of the agencies, Google was introducing a new feature every week (quite literally). The SEO firms have started feeling the heat. They now spend hours hoping... that there is that "ignorant agency (KNIGHT IN SHINING ARMOR) with pots of cash" somewhere, that could buy them out. They know time is running out fast.

So, what am I trying to say...

Google might still pull it off... at least they feel they can - their BIG DIS-INTERMEDIATION plan. The resistance comes from just one segment - Process driven SEM firms - the ones that have developed solid systems, processes, technology - KNOWLEDGE BASE  and have established robust training practices/processes.

And yes, there is one more big HOPE AGAINST Google's dis-intermediation attempts - Yahoo!

I am hopeful that with  founders - Yang and Filo- coming back at the top - they would at least provide a  stiffer competition to Google.

Unfortunately, I can't say the same thing about MSN (wish I could). They seem to be helping Google  increase domination, indirectly, through pathetic support and AdCenter platform.

- Udayan Bose