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List Companies Are Largely Still Searching for Search

List professionals and their clients understand the value of search engine marketing and optimization as part of a multichannel approach, but for the most part list companies are not quite ready to add search as an internal function. Still, at least two firms are bucking the trend.

Though many list executives hope eventually to bring search into the fold as a service offered directly, some have opted to partner with third-party service providers. One example of this strategy is found at Direct Media.

“We are strongly considering starting our own internal search unit, but it requires a tremendous level of expertise, ongoing training and staying on top of the different rules that the search engines put into place,” said Ed Bocknik, executive vice president of e-commerce at Direct Media Inc., Greenwich, CT. “Right now, we have partnered up with a company to offer it to our clients.”

That partner is eVision, Branford, CT, and the company handles both search engine optimization and pay per click. Bocknik said Direct Media talked with several search companies and allied with eVision in April 2005.

Another approach taken by some list companies such as Millard Group and Worldata has been simply to refer clients to outside search vendors without getting directly involved.

“We are referring clients to various search companies, but we are not taking a fee,” said Jay Schwedelson, corporate vice president at Worldata, Boca Raton, FL. “We are looking at bringing it in-house, but we don't feel the structure is there within the channel for our role to be significant enough.”

As for partnering with an outside company, Schwedelson said it just creates another middleman situation.

“Aside from not having to find a vendor, the client does not benefit,” he said. “I don't think that anyone is doing anything deceitful, but I just don't think the client is benefiting.”

Meanwhile, ParadyszMatera has been involved in search since 1999 with its PM Digital division. PM Digital is a full-service online agency with more than 20 employees. Aside from search, it also does creative, online marketing, tracking and analysis. Chris Paradysz, CEO of ParadyszMatera, New York, said it's imperative that the list industry get up to speed in this area.

“It's a serious investment like the list industry invested in itself 20 years ago,” he said. “This is as critical, if not more critical, because the consumers live in multiple channels, and that's the way they want be communicated with.”

Paradysz is enthusiastic about the possibilities of search.

“In my career this is the most exciting time I've ever had,” he said. “It's the biggest opportunity ever, but to jump over the line in anything you can't dabble.”

Mokrynskidirect also started an internal search operation as part of its online services division two years ago, though the division works with an outside technology vendor that provides the bid management and reporting system. The division has six members with three working on search.

“We partner with a company for the technology but we manage the technology, client relationships, search engine relationships, bidding and reporting,” said Steve Tamke, senior vice president at Mokrynskidirect, Hackensack, NJ.

Tamke declined to name the technology company but admitted that the team originally relied on its partner for a lot more of the process; now, the team is versed in search.

Fellow list professionals say they face several challenges before heading down the path Mokrynskidirect has taken. For one, the similarities between search and list brokerage and management are limited.

“The list person and the search person are trying to accomplish the same thing for the client, which is new customer acquisition, so there is synergy but it is two different skill sets,” Bocknik said.

Forging direct relationships with search engines is not easy, according to Schwedelson.

“The way that it's structured right now, the major players in search — the Googles and the Yahoos — are certainly not extending a hand and saying, 'Hey, list brokers, we really want you to play a role here,' ” he said. “Until the search engines really want to acknowledge the list professional's role as a media broker, I don't see it being a win-win for the list broker and their clients.”

Paradysz acknowledged that dealing with search engines is not as straightforward as renting mailing lists.

“With the major search engines, you have to go through very rigorous testing to do business with them — one, to qualify; two, to have any kind of credit relationship; and, three, to be able to get any kind of access to their major tools,” he said. “Anyone can do a self-service type of search engine marketing, but you're not really using the sophisticated analytical tools and sophisticated buying types of services that they offer.”

But Tamke said Mokrynskidirect has found no resistance from the engines in terms of recognizing them as a media broker.

“If you can talk the talk, they are receptive,” he said. “We've had client situations where we got further than marketing agencies.”

Mokrynskidirect's division has encountered challenges of its own.

“The rapidly rising price of keywords is a factor as more and more people enter the bidding,” Tamke said. “Also, more and more people are clearing cookies from their computers, and having that cookie there is essential for getting credit for the sale.”

For list companies, it seems that getting deeper into search will require a significant investment.

“List professionals need to bring the abilities inside and be recognized as a media broker, but one person is not a department or a group,” Schwedelson said. “Any single decent-size account with search can take a person's entire day.”

Buying a search firm might be an option, Paradysz said, but a good one would be very expensive. Either way, the investment needed is sizable in terms of money, time, personnel and technology.

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