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Monday, April 26, 2010

Google Affirms the Vital Role of Marketing and Advertising Agencies

It's great news that Google has taken the time to think through the pivotal role of agencies in helping advertisers advertise on the Google AdWords platform, and to release a new AdWords Certification program. As the head of a search marketing agency, I value the fact Google is explicitly affirming their philosophical support for the agency world at the same time as they release specific changes in programs and pricing that support that relationship. Official mission statements are important; they ensure that no one at any level in the company is hearing contradictory messages. Sometimes, all it takes for us to be able to work better together is to hear someone say (and write): you've got a formal place in our ecosystem, and a special place that won't be interchangeable with everyone else's place, or too easily devalued.

So, the obligatory punch on the shoulder, and "aww shucks, thanks, guys".

To be sure, no one is naive enough to think that Google won't also work directly with some advertisers. But there should be no more talk that Google is uncertain in its approach to the agency ecosystem, or that the powers that be at Google somehow want to "cut agencies out of the equation." You don't invest in support, agency teams, new certification programs, and new API models unless you're sincere in the support.

Waiving AdWords API fees for agencies using their own bid management tools adds up to a significant chunk of change. It also, as Google notes, leads to more innovation. In developing new ways to automate marketing, developers at agencies (and the end client) won't have to mentally subtract out the cost of the API tokens when deciding how much time and money to invest in new tools. If some agencies abuse the privilege, that's easy enough to stop. Tell them to stop it, or the fees will kick back in (and their Partner status could be revoked).

Outside the AdWords ad world, this might seem like a minor deal. To those in it, it's pretty significant because it means Google has indeed evolved into a mature player much as many of us hoped and expected.

Here's a quick before and after to give you a sense of things:

Before: A confusing Google AdWords Professionals certification that was very easy to achieve, handed out to a wide variety of semi-qualified individuals, with no clear delineation between scrappy upstarts who can pass a simple test, and who would be really interested in helping you with your AdWords advertising; and real agencies with infrastructure and a track record of working cooperatively with Google and solving many client problems over time. Later, a Qualified Company certification got bolted onto that. While a step in the right direction, it left too much confusion in the marketplace and didn't give enough credit to the difference between entities (agencies) and individuals (anyone who can get a decent grade on what amounts to an open-book exam).

After: A redefinition of the Qualified Individuals status to help individuals showcase their talents to potential employers (not directly competing for clients with more qualified agencies or experienced in-house talent); a redefinition of the Partner Certified Qualified Companies to mean more rigorous exams, and a range of other benefits like a searchable Google Partners listing.

There's quite a bit more to it, but that's a start.

I started as early as 2005 trying to articulate the case for such an evolution at Google -- mainly, in both editions of Winning Results with Google AdWords. While many in the space sort of took Google's informality at face value (panting with lust at any announcement of any kind of Google certification), I always figured they'd have to take another crack at this because the ecosystem of resellers and partners (assuming it demonstrates its value and shows itself deep, wily, and resilient enough to maintain customer relationships as opposed to being disintermediated/crushed) must be treated formally as such, much as it always has been in the technology world, with companies like Microsoft serving as the global standard (but there have been hundreds of others). As Google began rolling this type of thing out with Google Website Optimizer and Google Analytics (as strange as it is to be a "reseller" of free products), the logic became clearer, and you knew/hoped that Google would soon be on its way towards formalizing those relationships on a few fronts.

The old approach and the old programs were a bit tantamount to us out here being asked to "fan" Google on a Facebook page, without too much interaction, formality, or "anything in it for us," and as a result, on the other side, Google couldn't ask too much in terms of stated qualifications, business characteristics, more rigorous certifications, etc.

The new approach takes aim at the future and walks us all kicking and screaming into adult relationships. The old, informal ways were fun and we will miss them. But they're a thing of the past.

I'll leave off quoting at length from Winning Results with Google AdWords, 2nd ed. (2008), where I addressed this sort of thing.

"Third parties often advise clients on how to use AdWords, or directly manage complex campaigns. ... Observing Google's progress in dealing with the environment of marketing and advertising agencies, they have never fully given up on the idea that advertisers really should be coming directly to them for advice. However, this situation appears to be improving.

A Google Advertising Professionals (GAP) program, launched in November 2004, was an interesting initiative that was supposed to sort out qualified from unqualified individual AdWords campaign management practitioners. A company wide (agency) version of this is also available. This is more of a training and indoctrination program than anything else, however. The reward to the qualified professionals and agencies is minimal at best, though ostensibly it helps advertisers avoid working with "hacks".

Agencies certainly get much less out of Google in terms of financial rewards (such as a commission) than they have in any relationship in the history of advertising. On a variety of fronts, including the Google-agency relationship, observers have asked the question: is Google sucking the proverbial oxygen out of the room? While consultative relationships have improved and become more formalized -- a key improvement, to be sure -- many of the leading AdWords consultants and evangelists must make their living from service fees alone ... while Google's extreme profit margins continue to fuel the company's growth. There are practical hurdles to be addressed before such traditional advertising industry practices can be adopted, particularly in the "geek culture" which has served Google so well. However, the goodwill ... of the search marketing agency community ... may hinge on a recalibration of their financial relationship with Google.

In its formative years, having the right (geeky, iconoclastic, world-beating) attitude at the right time was a big part of what made Google into a global powerhouse. Some critics predict that this same attitude could be its undoing. Experts believe that the degree of cooperation with the developer community (and I would add, the marketing ecosystem) will determine whether the company has the staying power of a Microsoft.

Through the back door, Google may be studying ways of responding to the above analysis. Beyond AdWords, the company has new, highly technical products, like Google Analytics and Google Website Optimizer. It has initiated partner and reseller programs for these products. By instituting criteria for membership, working closely with the community on product development, and figuring out ways of steering valuable consulting business to such resellers and partners, Google can study the ins and outs of forming such productive relationships. Such relationships seem to be founded on classic models common in the software industry, especially in high-ticket enterprise software. What makes this unorthodox (as usual) is that Google's products are often free, and many of the customers for them are small to midsized businesses. What will it mean for my consulting firm to "resell" Google's free product to a small customer, I wonder? Like many others, including Google themselves, I can't wait to unravel that puzzle. ..."

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