It’s always interesting to look at major events like the SES and people’s impressions of them. One of the best writers to attend the SES was Gord Hotchkiss, a search engine marketer and observer of the meta patterns that drive a lot of the current SEM market. He wrote an article titled “THINGS ARE CHANGING IN THE SEM WORLD” (You can look at it if you have a subscription to mediapost.com’s newsletters here). Summarized, here are the things that I liked and disliked about Gordo’s main assertions in the article:

1) Search engine firms run the risk of making themselves irrelevant if they stay in a narrowly defined niche that helps neither them nor the agencies who engage them.

We agree completely. As Gordo puts it, “Search agencies position themselves as the keepers of the vaunted black box, the holders of arcane knowledge and assets essential to the truly enlightened marketer. That black box could be advanced algorithmic optimization knowledge and technology or sponsored search management technology and advanced campaign optimization tools…the potential buyers seem content to cede this small area of expertise to the SEMs, because they lay claim to pretty much everything else.”

The problem here is that search engine marketing is MARKETING. The psychology is ancient, even if the technology is new, and people in our industry run enormous risk of being marginalized as the technologies and conditions change if we forget that.

2) Quality scoring changes require SEM firms to work harder to uncover the algorithms that make the quality scores meaningful.

We disagree with this, largely because it misses the point. Algorithms are not a good way to build a company if the rules keep changing. As one of our analysts often points out, Google will tell you exactly what they care about in SEO and in PPC in general ways. If you adhere to these general rules and do them well, you will succeed. Obsessing over algorithms will only mean short-term gain that will fail immediately after the search engines change the rules again.

Gordo does get it right, though, when he states that “We have to look at not only the quality of the ad but also the quality of the landing page and the subsequent on site experience..Without exception, the biggest challenge we’ve had in delivering effective results has been in getting the buy-in of the various groups required to take a holistic approach to search. The introduction of a quality score means this will be happening with greater frequency.”

Google cares, ultimately, about making companies that have high conversion rates and high click-through rates successful, because these companies will make more money, and as a reult spend more money with them. So, if you focus on high conversion rates and high click-through rates (i.e., make good ads and good landing pages that work in a solid, well-architected site) Google will reward you. It’s really very simple, but it’s hard to market those kinds of fundamentals and many SEM companies try to describe the “quick fix” of algorithms.

3) Search Engine Marketing Firms are the new Madison Avenue

We don’t agree with this. Online marketing represents only a sliver of the total advertising spend worldwide. More importantly we still are very immature as an industry in understanding who the customer is and how they think about things. For all of modern advertising’s failings, they still are desperate to understand the consumer and convince him to buy. There is significant knowledge about how to do this on Madison Avenue, even if they often ignore it or have no good metrics to test their assumptions.

What we do bring to the table, and the way that we will help advertising mature, succeed, and better serve consumers, is an emphasis on testing and metrics. As Claude Hopkins, the great sage of advertising, put it in 1918,

“Most national advertising is done without testing. It is merely presumed to pay. Such methods, still so prevalent, are not very far from their end. The advertising men who practice them see the writing on the wall. The time is fast coming when men who spend money are going to know what they get. Good business and efficiency will be applied to advertising. Men and methods will be measured by the known returns, and only competent men can survive.”

Okay, so he was a little ahead of schedule. But we bring that ability to have accountable, MEASURABLE marketing. It is this key component of our business that will make us equal partners with the giant advertising firms, or–if Madison Avenue does not adapt–the giant killers.