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Search Marketing 2004: What's Right, What's Wrong

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Danny Sullivan's wide-ranging keynote address at Search Engine Strategies San Jose prodded several raw nerves in the industry, sparing neither search marketers nor the search engines themselves.

A special report from the Search Engine Strategies conference, August 2-5, 2004, San Jose, CA.

In a longer version of this story for Search Engine Watch members, Andrew Goodman offers his own insights and analysis of industry trends, describing the increasing competition between traditional search engine optimization firms and advertising agencies and providing context for the undercurrents of change currently rocking the industry. Click here to learn more about becoming a member.

Search Engine Strategies (SES) veterans have long recognized the even-handedness, timeliness and breadth of the material presented at the conferences. The continued growth in attendance testifies to the wisdom of the strategy of offering a little something for everyone, and constantly gauging audience interest in various topics and points of view.

When it comes to the keynote address, though, we get a glimpse of what Danny Sullivan really thinks of the state of the search engine marketing (SEM) industry, and it's always a treat. Sullivan spoke to a standing-room-only crowd at the brand-new McEnery Convention Center in downtown San Jose. He noted that 150 people attended the first conference in 1999. Today, some SES dates attract ten times that number, with four stops a year in North America alone.

Thanks to the prolonged Google pre-IPO quiet period, recent unflattering media portrayals of search engine marketing, and bubbling controversy about a fledgling industry association called SEMPO, you could have cut the tension in the air with a knife as attendees arrived at SES. Sullivan broke it with his feisty address.

Some veteran attendees I spoke to afterwards felt that this keynote was more controversial than usual. Newcomers, by contrast, sensed an animus in various speeches and conversations that week, but couldn't quite fathom what it was all about.

It was this theme of respectability--or lack of it--that provided some of the background context for Sullivan's keynote. He railed against a blog entry by well-known business author Seth Godin that argued, in part: "Lucking into (and it is luck) the top slot of a great word on Google is not a business plan. It's superstition. It's blind faith." It goes without saying that Godin speaks from little experience, having never spent any time in the professional SEM trenches.

In castigating the news media for inaccurate reporting about search engine marketing, Sullivan recalled that several years ago, pundits predicted the demise of search engine optimization and related service firms, either because search engines would get wise to their tactics or because the preponderance of search listings would become paid.

Although it can't be denied that SEO has taken some severe body blows in terms of the proportion of listings on search engine results pages that are now paid for, there is no disputing possibly the most important bullet point in Sullivan's presentation: "it didn't die." Nor does Sullivan expect it to die anytime soon.

Because advertising as a whole is not a growing industry, he argued, the growth of search engine marketing will inevitably involve a continued effort to increase its share of corporate marketing and advertising budgets at the expense of other media. That leads to the overarching message of Sullivan's talk, which I'll save to the end (keynote reviewers need to use suspense, too).

Next, Sullivan turned his fire-hose on the intransigent current behaviors of major search engines. While pointing hopefully to the return of a "four-crawler" environment (with four leading, regularly-updated brand-name spider engines for consumers to choose from (Google, Yahoo, Ask Jeeves/Teoma, and MSN), he saw little to celebrate in such an environment if certain deficiencies aren't remedied.

He presented a webmaster's wish list that included features like warnings of shifting algorithms and index changes; some type of "express line' for accredited webmasters to report spam to the engines; agency-style commissions for selling paid search listings (Sullivan congratulated those few paid-SEM consulting firms who can survive on service fees alone, but felt it unfair that they must do so); and in general, "a partnership in attitude on both the paid and free sides."

Using his own search for a Radio Flyer Wagon for his son as an example, Sullivan also addressed some of the continued shortcomings in the user's search experience, implying that spammy results could be reduced with a comprehensive implementation of better search engine cooperation with accredited SEM firms, and a drive towards standards in the SEM industry. In this example, retailers without physical local brick-and-mortar presences were using misleading geographic keywords to improve their rankings. The end result: an annoyed user.

To distil Sullivan's keynote down to its overarching message: search engines and search engine marketing firms have a mutual interest in working together. But towards what end, or against what perceived enemy? This talk seemed to focus mainly on the enemies: index spammers, bad search experiences, rogue SEM firms, and uninformed journalists.

Beyond that, the working-together strategy would target corporate marketing departments who over-budget for ineffective traditional media campaigns and under-budget for online marketing, and who continue to ignore data on the superior return on investment associated with search engine marketing. Sullivan seemed to say that it's not merely a question of waiting and watching for "big agency money" to flood in; that much of the growth and advocacy will be driven by the SEM grassroots--talented search engine marketing firms of between one and fifty employees, speakers and educators in the field, and in-house SEM professionals. Agencies, indeed, have been known to actively discredit the SEM component so they can get back to business as usual.

Given the pedigree of Search Engine Watch and the Search Engine Strategies conferences, this talk was not as controversial as it might have seemed to a newcomer. Given the unresolved nature of the questions Sullivan and others raised at the San Jose conference, one thing seems certain: there will be record attendance at the next few events.

Want to discuss or comment on this story? Join the State of the Search Marketing Industry 2004 discussion in the Search Engine Watch forums.

Andrew Goodman is the founder and principal of Page Zero Media and author of the forthcoming book Winning Results with Google AdWords.

In a longer version of this story for Search Engine Watch members, Andrew Goodman offers his own insights and analysis of industry trends, describing the increasing competition between traditional search engine optimization firms and advertising agencies and providing context for the undercurrents of change currently rocking the industry. Click here to learn more about becoming a member.

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