The 2015 State of Search Industry Report from the SEMPRO Research Committee, Search Engine Land and Marketing Land is out and offers a nice look at where many search-based marketers' heads are when it comes to digital marketing focus, spend and more.
I say search-based marketers because the online survey of 500 professionals is primarily focused on readers of the two blogs, which tend to be search-oriented pros. That’s not to invalidate the data, but to simply establish some level of expectation of inherent bias in it. While certainly the survey takers likely include some broad-based marketers, CMOs and even integrated agency types, the core audience of Search Engine Land and Marketing Land are SEO pros. That’s neither good nor bad. It just is.
Knowing that, here are some takeaways from the report that I noted, keeping in mind my perspective is that of a broad-based, digital marketing strategy focus. Search, social, online media, email, apps … they’re all important in my tool box. While social may be my most robust area of focus, the others never fail to take some level of attention in what I typically recommend for clients.
When 86 percent of brand marketers, noted as “marketer/client” by the report, say they carry out email marketing and just 50 percent of agencies do, you can assume that brands are very protective of their email marketing programs. There are several reasons for this, but the fact that email marketing is still the most effective spend in the digital landscape (almost 2:1 in ROI according to the Direct Marketing Association) is likely chief among them.
Which leads to the question - As search or other digital avenues continue to prove their worth, will they, too, become more brand-side activities rather than agency led? Chances are good that will happen. Let’s see if the ROI value of Search and other areas continues to rise.
Yahoo! has transformed itself into a more broad-based web property under Marissa Mayer’s leadership and though it’s still heavily dependent upon search for revenue, search marketers have all but given up on it. Of those surveyed, when asked if they’re investing more or less in the various search engines, 60.2 percent said Yahoo! wasn’t relevant. And 44.9 percent said they’re investing less. I think it’s time to take the exclamation point off the logo, Yahoo.
When asked which social advertising platforms are marketers using most, 58 percent of agency-side marketers said Facebook ads, compared to just 30.5 percent of brand-side marketers. In fact, brand marketers were more likely to use every other ad platform than their agency counterparts. Is this because brand marketers are experimenting more or perhaps casting wider social nets? Are agencies blinded by the power of Facebook or do they know something brand marketers don’t?
We’ll likely see these numbers level out as Twitter, LinkedIn and platforms like Instagram become more tested and stable, but if agencies don’t figure out how to not hitch their cart to one horse, brands may lose faith in them.
The survey asked what the typical fee structure was like for brands paying digital partners. The answers were broken own over verticals of email, display, social media, paid social, paid search and SEO. A big, fat portion of brands say they pay on a fee per click basis (22 percent for social media, 18 percent for paid social). Yet, the corresponding number of agencies reporting being paid that was 1.2 percent for social and 4.2 percent for paid social.
Certainly, the brand-agency sample wasn’t 1:1 so the data isn’t a perfect match, but with a sample size of over 500, something doesn’t jive. Agencies say they mostly get paid with flat agency fees with anywhere from 28 to 41 percent reporting that structure in the various verticals. But marketers report only paying 13 to 23 percent that way. So something doesn’t fit.
From the agency side, I can tell you that brands paying a fee per click are
A) Undermining an agency’s value, and
B) Exposing themselves to fraudulent billing, as clicks can always be gamed.
Most brands don’t like paying percentage of media spend because that motivates the agency to just recommend spending more money. The flat agency fee seems to be the fairest approach to billing, so it will be interesting to watch those numbers over time to see if that grows.
Annual State of the Whatever reports are useful when you look at the results over time. Not much is changing really in the digital marketing space. We still have problems figuring out ROI and arguing for budget (which the survey also covers). We are seeing more spend on social media, especially in social advertising. But Search is still the dominant digital channel in terms of spend, even if email has proven to be more effective from an ROI standpoint.
I don’t know that I would say there’s much to fault about the study. It seems to parallel my experiences talking with clients and brands about their digital efforts. But there are certainly some interesting nuggets in there to ponder on.
You can see the entirety of the report at the SEMPO website.
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