Hiring a PPC Firm

by pdrs 2 replies
Hi There,

The company I work for is in the process of vetting a few PPC advertising management firms.

We have a fairly significant budget for ad spend (in the thousands) and I've been in contact with quite a few different firms ranging from larger worldwide marketing agencies to smaller local boutique shops and as you can imagine the prices/spend expectations vary wildly.

I'm just wondering if anyone would care to offer any advice or things to watch out for when working with a firm like this.

We are looking to strictly increase online sales, we also have brick and mortar locations (approx 15 locations nationwide) but a different marketing team looks after that so I want to be very clear with the PPC/marketing people that the goal here is to drive e-comm sales and not just "brand awareness".

Without giving too much away, we sell handmade chocolates as well as some novelty items (t-shirts, kitchen gadgets, various mugs, bags, etc...).

Look forward to any response!
#pay per click/search engine marketing (ppc/sem) #firm #hiring #ppc
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  • Profile picture of the author dburk
    Hi pdrs,

    Here are a few tips for you in your vetting process.

    Be careful of larger agencies that manage large numbers of clients per account manger. It's not unusual for a campaign manager at a larger firm to be handling 100+ clients simultaneously. With a bidding automation system it's not hard to do that, but you get a much less personalized service, in other words, your campaign is managed more or less the same way as everybody else and it might not give you much advantage in the marketplace.

    PPC advertising is one of the most competitive advertising platforms so you need a winning strategy and very active micro-management of campaigns to defeat your toughest competitors.

    Another thing to watch out for is an agency that focuses on reducing cost rather than growing your market share. There are some business situations where this makes sense, for example if you we preparing to sell your business, or wind down due to retirement, or have maxed out your business's capacity for the foreseeable future. If your goal is to increase online sales, or grow total profits, make sure the your agency knows how to do those things, because not all agencies do. Many are trained exclusively on reducing acquisition cost and maximizing ROAS, and that generally leads to lower sales growth rates.

    If your primary goal is to increase online sales, a focus on lowering acquisition costs, while seemingly good for ROI, can lead to a loss of market share, especially if taken to an extreme. They will deliver nice reports that show how much your ROAS has improved, but total sales, and more importantly, total profits might be lagging behind your competitors that are growing sales more aggressively.

    You are in a contest to win customers away from competitors. Merely settling for the crumbs left behind by your competitors can be great for improving ROAS and lowering your CPA cost. However, that appraoch can seriously erode your market share. Keep in mind those are merely metrics, and should not be considered business goals. You cannot deposit a better CPA or ROAS metric in your bank account. Those metrics are useful for diagnostic purposes, and should not be treated as a goal, because they have no bankable value on their own.

    Ask the campaign manager for a general strategy that matches you goal. If the answers all focus on lowering CPA, improving ROI, and no specific plan for how to grow sales and capture a bigger share of the market away from your competitors, then you can bet that they are going to be managing your campaigns like a cost center rather than like a profit center.

    A cost center management mindset is prevalent in most agencies, yet the top performing agencies are all focused on Profit-driven marketing which flips that mindset upside-down, treating your campaigns as a profit center rather than a cost center. The Profit-driven approach will grow your business at a much faster pace and in the long run will be far more profitable than using a cost center approach.

    Take what the sales reps at those agencies tell you with a grain of salt, they are trained to find your psychological triggers, and push all the right buttons to sway you toward choosing their agency. Those slick sales people are not going to managing your campaigns. Instead ask to speak to the campaign manager that is likely to be managing you campaign and ask them for a general overview of the strategy they would implement for reaching your business goals. If their answers are all referencing cost containment, lowering your CPA, and improving your ROI, then they are not the right agency to grow your business.

    Make sure the campaign manager's general strategy fits with your primary campaign goal. If your goal is to grow online sales and he's talking about ROI, CPA, and lowering costs, then his approach isn't going to match your goals. Those may all sound like nice objectives, and they are in some circumstances, but they will tend to minimize your primary goal if it is to grow fast. Move on to the next agency until you find a manager that produces a strategy that is perfectly inline with your business goals.

    HTH,

    Don Burk
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  • Profile picture of the author MikeFriedman
    Along with what Don said, which I think is a great answer, I would also want to know how often they will be available for updates and what kind of updates they will provide. Initially, you would probably want to be able to talk to them once a week or so. As trust builds, that can be dialed back.

    There are a lot of PPC managers that basically disappear until the invoice is due next month.
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