E-consultancy Search Marketing Buyers Guide – a small gripe about some of the companies featured

I have finally got round to having a read through this years E-consultancy Search Engine Marketing Buyers Guide. This is the second year we have been featured ourselves; as a relatively small agency growing fast and with great ambition, it is a great pleasure to have been asked.

However, I do have one small gripe and it has nothing to do with the production of the guide itself or E-consultancy. For those who read this blog regularly you by now may have worked out that generally when I post it is because I am having a moan about an aspect of the digital marketing industry that disappoints me; this is a another of those times. A small gripe but nevertheless something I found frustrating.

Upon receiving the template to complete a few months ago for the buyers guide, I was absolutely delighted to see a new question posed this year concerning the % of revenue that is accounted for by media spend. I read this question as meaning the following; ‘how much of your revenue is in reality not ‘your’ revenue at all but simply money being passed through your books that ends up in the coffers of Google, Yahoo and the other engines, via Paid Search?’.

So as an example; if company ‘A’ has turnover of £10m but their percentage of revenue that is accounted for by media spend is equal to 80%, it means that in real terms they turned over £2m. Why? Because the other £8m is accounted for by client click costs simply ‘passing through’ the books.

Great I thought! I have often wondered with ‘larger’ agencies, dealing with some of the world’s largest brands, how much of their revenue is related to click costs and therefore how much money they are actually making for themselves. However, what was disappointing to see was the number of agencies who simply avoided this question.

In fact I won’t name them, but many agencies even refused to disclose revenue figures, including the agency who, in their own words, are ‘the fastest growing search marketing agency in the UK’. If so, why not back it up with your figures so we can all see just how much you have grown. Have you not heard of Companies House? If I want to know I can easily find out!

Anyway, back to the question regarding media spend. My view is that transparency is key in our industry…across everything. This should extend from the delivery of consultancy all the way through to how much money you are actually making. Not revealing the level of media spend only goes to suggest you have something to hide; that you are not quite as you seem; that the lovely big revenue figure that most are only to happy to reveal is actually masking a true figure which is significantly lower.

So to avoid the cynics like me getting on your back next year why not be open and honest about this. E-consultancy obviously included the question for a reason. I presume it was to try and flatten the playing field; to try and get a truer picture of who the movers and shakers are in terms of actual revenue made from consulting services, etc not the money that simply passes through the books to the search engines.

Perhaps in some cases there are good reasons not to disclose revenue or media spend figures but in an industry crying out for transparency, agencies should lead the way by being open with their figures.

Until the next rant…

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