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The buy vs. build argument for SEM, Part III

Over the past few months, this column has explored both the buy (outsource) and the build (in-house) arguments for search engine marketing. The topic’s origin is really quite simple: Last fall, multiple marketers asked me to conduct this type of analysis prior to going into their annual budget planning process. In wrapping up a handful of these projects, I ended up with at least one buy and one build, and realized that that certain points applied to both the in-house and the outsource crowds.

External factors
To start it off, most buy vs. build decisions are preceded by a current state vs. future state analysis. That is, the firm takes an honest look at where it is today and where it wants to be, identifies the gaps between those places, and then looks at the strategic options to close the gap. While this is a very common activity, it is usually precipitated by some larger issue. In both client scenarios, it became clear that this analysis was directly tied to the firm’s current financial position, recent management changes and an uncertain economic forecast.

Organizational behavior
With such issues lurking in the background, it is normal to address organizational behavior first. Nine out of 10 times, I see situations that are as much more about change management than they are about the discipline of search. These two clients were no exception. Multiple factors played into the builder’s decision, but the largest by far was the fact that the organization and culture simply could not effectively partner with another firm in its current state.  As one key employee said, “We could pick the best firm and it would die within our walls.” For the outsourcer, the wounds with the provider of over five years were too deep; they opted to find a new partner. “There’s just too much history,” said one stakeholder; the multiple brands, internal stakeholders and the agency itself were incapable of coming together to make the situation better.

In both cases, I brought back a document that was quite helpful in the hectic interactive agency culture of the late ’90s: the team charter, aptly re-dubbed “the search charter.” The document detailed the team purpose, values (mutual respect, assume good faith, etc.), and general process for solving problems. No specific details, such as names and duties are listed; this document is more about coming together than it is about the “not my job” attitude. Ideally, everyone puts their John Hancock on the bottom.

Educating the troops
A third factor at each firm was the need to provide education for employees whether they are in house folks running search or just those overseeing an outsourced relationship. If management is serious about education, I recommend a corporate budget of $2,500 to $3,000 per person, per year. For this sum of money, an employee should be able to:

  • Attend a conference. For this to be successful, employees should return with notes on assigned sessions, as well as any other sessions that interest them. The most valuable shows for tactical training are the SMX and SES series.
  • Search for training. Both the SEMPO Institute and the DMA provide online course for novices and experienced marketers. Multiple firms also provide face-to-face training in classroom or on-site format.
  • Subscribe to premium content. Just about every marketing content provider has premium content to share. This also applies to research and studies.

If speed to market is critical, then raise that number to $5,000 in the first year. I recommend that all education decisions be approved by management. It is human nature to gravitate toward learning more about what we do best. For those who have stellar search skills but are struggling with a changing organization, I recommend taking a soft-skill class. As much as we hate to admit it, we can all use help in this area, regardless of where we are in our careers. The American Management Association has multiple courses that can be helpful to the search engine marketer. There is even a course called “Communicating up, down and across.”

Pulling the numbers together
With decision in hand, both players needed to present the recommendation to the highest ups. This meant pulling the numbers together for both scenarios for comparison’s sake. For the buyers, the vendor’s fees are measured against the incremental return. For the builders, salary data, such as that provided by the recent SEMPO in house survey, and technology licensing are added together. Depending on the talent at hand, each side of the coin should toss in adequate education for good measure.

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