Search engine marketing agency Didit announced last week it will issue up to $1 million in Campaign Performance Trust Accounts (PTAs), essentially insurance accounts, to clients that launch new search campaigns in the fourth quarter of 2008.
Mark Simon, Didit’s VP of industry relations, said this comes after Didit noticed a trend towards companies bringing their search engine marketing initiatives in-house. “A lot of marketers feel they’ve been burned by their agencies,” he said. “We need clients to have a renewed faith in what [SEM] produces as an industry.” This venture poses many questions of accountability for search agencies, especially with today’s economic downturn.
In fact, the Association of National Advertisers released a study conducted last month that found that 42% of marketers have established in-house agencies. Many of these are managing search campaigns.
Despite this, other search marketers are questioning whether moves such as this are necessary, as most search agencies rely on more traditional performance pricing or pay-per-click models.
“It’s an interesting topic, to say the least, and it’s definitely going to spark conversation,” said John Tawadros, COO of iProspect. “But I don’t know if I agree that this is a trend or an epidemic, per se. I haven’t heard anyone referring to paid search as something that needs to be insured. The growth rates in paid search are still astronomical.”
Simon said Didit is urging SEM agencies that are “confident enough in their services” to offer similar incentives.
“If you look at paid search, where could things go wrong? With the publisher or the agency,” Tawadros said. “I think in both cases, just good business practices would dictate that you would make good on your error.”
He added, “If people think that they’re able to do things as well or better than experts who have been in the search business for years, just building out campaigns for clients, then where is the future of this industry going?” It remains to be seen whether other search agencies will follow suit.
Tawadros is skeptical. “They’re looking for other agencies to join, but at the moment, I can tell you we’re not going to create insurance policies,” he said. “We don’t feel the need to. It’s about results. Insurance policies say, ‘If something goes wrong, I’m somewhat protected,’ I’m not looking for that. I’m looking for confidence that as an agency you can deliver.” Didit declined to share which of its clients are currently participating in the PTA program.
