Top 10 questions to ask before you hire an SEM agency

No mistake about it, hiring a search agency is a big decision. It could impact the very success or failure of your company and career. You need to find an agency you can trust to make the right decisions for you. Here are the top 10 questions I would ask an agency BEFORE hiring them:

1) How do you charge?

Many SEM’s have different business models for their fees. They can range from a % of media to Cost Per Action and there are many hybrids in between. Just keep in mind, if an agency gets fees as a % of media they are going to be incented to increase your media spend.  As an advertiser, is that what you want? If I was an advertiser I’d want my agency to be incented to improve my Cost Per Action (CPA) or Return On Investment (ROI). If that means they have to limit media spend then that’s in my best interest. Some agencies will offer a flat cost per click among all clicks that you receive. This is inherently flawed as well, since they’ll be incented to drive only low cost clicks to you in order to increase margin. Those might not be the competitive keywords however that drive your business.

2) Give examples of how you’ve saved your client’s money in PPC?

This is a great question which will peel back the onion and indicate the sophistication level of the agency you’re reviewing.  There are a number of answers to this question which should include using third party tools to analyze search network traffic sources to simpler techniques such as keyword bid management, pausing underperforming tail keywords, utilizing negatives and keyword matches etc.

3) What factors drive quality score?

This is really a pretty simple question that we recently asked a job candidate, who supposedly had extensive PPC experience. Unfortunately he did not know the answer and did not receive an offer. It’s easy to say you’ve been managing paid search programs as anyone can do it. The question is do you know the techniques that will help your business succeed in this highly competitive marketplace.

Alas, there are many factors that go into quality score; the most important however is click through rate. If your agency says match types or even worse, what’s quality score, run away 🙂

4) What tools do you use to manage your search campaigns?

The answer you want to hear may depend on the needs of your company. If the agency you’re reviewing offers one solution to all clients you may want to look elsewhere. There are a variety of tools that help agencies manage their client’s campaigns, both for analytics and bid management. Some of the better known tools include e-Frontier, Omniture, Webtrends, Clicktracks, Acquisio etc. All of them have their own benefits and limitations. What I would say is they have to match your campaign, budget and goals. If you have a simple lead generation site and expect no more that 15 or 20 quality leads per month, a bid management tool may not make sense for you. There would not be enough data points for the tool to make informed decisions and an expensive bid tool would be overkill; meaning it kills your ROI. You may be a lot better off with a free analytics tool like Google Analytics, which gives you insights into visitor behavior (what happens after the click). However, if your media budget is $10,000 per month plus and you’re generating hundreds or thousands of conversions, a third party tool that can automate many of the bid decisions and provide an assist to the agency managing it would be more appropriate. So, look for an agency that listens to your needs and matches you up with a technology that fits your budget and needs.

5) Can I have a list of references?

Listen for hesitation. A good agency will have dozens of happy clients to offer as references and be proud of it. Reputation is everything in this business and you should be able to get a whiff pretty quickly if something stinks.

6) Are you a virtual agency or do you have a physical location?

Be careful out there. It’s very easy to create a website and appear like you’re established. Again, when you peel back the onion you might be surprised about what you find. What may look to be a credible agency could be a one man shop with a contractor or two. That doesn’t necessarily mean that’s a bad choice for you, but it’s unlikely a company like that will have the processes in place to service or transition your account if, for example, the contractor takes a full time job somewhere else. Be wary, and be sure to dig into this.

7) How many people will be working on my account?

If the answer is more than two that might raise a red flag, unless your campaign includes multi-media outlets like pay per click, search engine optimization, email and display. In that case, a team that fits your budget makes sense. However, if for example you plan to spend $5,000 per month on Pay Per Click a team of three or more does not make sense and would likely either cost you too much or be ineffective. One experienced client manager should give you the attention you need, while digging deep into the aspects of your business that drive success.

8)  What other services does your company offer?

This one could expose focus of your agency. Personally, I would look for a company that specializes in paid and organic search advertising and perhaps manages other vendors with specialties like social media and landing page development for you. Search marketing is an ever changing discipline. Even as the principal of an agency, I found out how quickly I could lose touch when I moved into more of a business management role. Search is dynamic, fluid and every other adjective you can think of. You want your search management company to be on top of their game, living and loving search marketing 24/7. If not, find someone else.

9) Where are you located?

OK, I will admit there is some benefit to hiring the search marketing agency down the street. Nothing better than some face to face meetings but it’s not necessary. Search marketing campaigns can be run from any location. If the agency is not local, be sure to ask how and with what frequency they will communicate with you. A weekly call or report, with insights from the client manager, should be more than enough to keep you and your agency on the same page.

10) Do you offer guarantees on performance?

Tread very carefully when the answer is yes. The scamometer should be redlining. Search marketing, whether PPC or SEO is not an exact science and does not work for every company. What you want from your search agency is a company that is sophisticated, intelligent and focused. That’s what’s going to give your campaign the greatest opportunity for success. Disingenuous claims are simply that; a sales technique to earn your business.

If you have an existing campaign, ask the agency to do an evaluation. They will need your login and password, but this is well worth it.  A good agency will be able to take a look under your hood and make some very compelling arguments about how they can help.

Maureen Jann About the author

Maureen Jann is a veteran B2B marketer whose career in Digital Media has grown up with the Internet. A self-described jill-of-all-trades, Maureen has elevated creative problem solving to an art form and enjoys the daily challenges of driving business results in unexpected ways. Her skills as an entrepreneur, content marketer, creative director and passionate people manager set her apart from the pack. Maureen has worked in every corner of marketing making her a skilled tactical resource as well as a strategic partner. Recently, she was the captain of the marketing ship for an award-winning professional services firm and is currently creating a content marketing strategy for Point It, a digital marketing agency.

  • Ken

    Hey, great tips for hiring an SEM.

    Liked it so much, I tweeted it here:

    You’re right about many SEMs not knowing the factors that contribute to Quality Score. How can you call yourself an SEM if you don’t know about CTR, text relevance, etc.

    BTW, I see you list a bunch of PPC management tools in point #4. Have you tried the new WordStream Keyword Management Tool yet for keyword research? It’s generating a lot of buzz in the PPC community.

    Take a look: Wordstream


    April 22, 2009 at 1:11 pm

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