Moving search agencies to the top of the value chain

This morning Media Post published a commentary of ours Is a search agency’s biggest competitor Google? I know, one normally thinks of Google and search agencies working in allegiance together. And while that is true at one level, when you analyze the relationship through the lens of “vertical competition”, you realize that Google wields tremendous power over search agencies.

The reason Google has such power in the search marketing supply chain right now is because most agencies sell clicks, and those clicks are mostly sole-sourced from Google.

Unchecked, this arrangement puts search agencies in a tenuous position — Google can change its prices and policies at will, and search agencies can be stuck in the position of absorbing the blow. The solution is to have search agencies elevate their role to selling conversions, not clicks, and become the king of the hill in delivering end-to-end, pre-click/post-click experiences.

Google doesn’t sell post-click marketing, so agencies can be at the top of that supply chain. Conversions have much greater value to the CMO than clicks. And since there’s much more room for differentiation in post-click experiences than the 130 characters of search engine ads, this is not a commoditized service.