In January 2016, Google published Search 2.0, a set of principles for running a successful Search campaign on Google Ads. In short, Search 2.0 emphasized the importance of retaining control of keywords and bids while using iteration as the vehicle for constant improvement. This methodology has been perfected and internalized by performance agencies world-wide, including us.
But the world looks very different in 2020. Though iteration and control are still core contributors to a Search campaigns’s success, they are no longer enough to drive growth alone. Monumental innovations and changes to the Google Ads platform have brought with them a breed of hyper-efficient, automatic campaign management which means that marketers must expand their competencies to better curb the platform’s (new) blindspots. We have identified three such skill areas: 1) Understand and activate algorithmic decision-making, 2) unlock operational synergies via strategic overview, and 3) renewed focus on translating insights into actions.
But before we dive deeper into these three new skill areas, let us take a quick look at what has changed since 2016.
A New Era of Search Marketing
With more efficient, automatic account management, it has become easier to manage a “standard” Search campaign. Furthermore, the digital savviness of firms in general has grown rapidly, which has narrowed the skill gap between specialists and non-specialists. So even if digital marketing investments globally continue to increase, it is no surprise that 51% of performance agencies are cited to worry about in-housing as a threat to their traditional business models. This is not caused by agencies becoming worse (on the contrary), but because platform-centric specialists are finding it harder to provide the companies the competitive edge needed to get ahead.
This is mainly due to the fact that machine learning has evolved so rapidly in our industry. Technology has allowed algorithms to make far superior decisions in most areas of account management, and studies show that algorithms outperform humans in many cases, though the combined effects of algorithmic optimisation and intelligent human intervention are still more effective. This is a trend in all industries, but digital marketing is especially susceptible due to the data reliance and the fact that the biggest propellers of innovation nowadays dominate the industry. As an example, all of the four tech giants, Facebook, Google, Apple, and Amazon, run an advertisement platform. And their greatest advantage is data. Proprietary data.
The Power of Proprietary Data
Platforms are naturally going to be better and better at running most campaigns with less operational maintenance and the ability and access to proprietary signals makes them uniquely capable of making real-time decisions about bidding, messaging, and landing pages. Here are just some examples of how machine learning is altering the processes of working with Search marketing:
- A/B testing of ad copy on a granular level is no longer feasible since different users are exposed to different ads if you let Google optimize ad rotation.
- Matching search terms with ad copy is becoming more difficult due to the fuzziness of which search terms can trigger which keyword.
- Feed based ad copy and targeting, i.e. Dynamic Search Ads and Shopping Ads are increasing in prominence (~50% of marketing spend), limiting the control of the ad copy.
- Although Google Smart Bidding still has its flaws, it has proved extremely good at reaching specific targets without any real campaign structure.
It is very likely that in just 5 years, most media buying on Google Ads will be more or less automated. What will then determine competitive advantage?
The answer again is data.
Gaining a Data Advantage
The next wave of innovation within Search will be to integrate first party data and insights with the platforms themselves, providing signals to the algorithms based on the proprietary data that the company owns. In the same way that Google holds an advantage by leaning heavily on their own signals in the auction, companies have the opportunity to gain a data advantage from knowing 1) their customers and 2) their path to conversion. Although recent legislation has changed the rules for data collection (for example the GDPR and CCPA), there are still plenty of opportunities for companies to gain a deeper insight into who their users are. Companies with a solid strategy for user trust and data collection will be able ask powerful questions such as “who is likely to be a repeat customer?” and “what is the incremental value of seeing a Search ad?”.
Activating this data is, however, no easy task, and marketers need to acquire a whole new set of skills to bring to life their data advantage. It is not only technical skills such as data warehousing and modelling that are needed. Being strategically savvy and having organizational overview will be key to getting the upper hand. There are many questions that data alone cannot answer, like “which new product will be in demand next summer?” or “what should the budget be for an market expansion?”. Marketers need to combine their technical skills in data management with softer skills in order to truly gain the advantage needed to get ahead.
In the next section, we will introduce our view of the role of digital marketers in this new era of Search marketing and the areas that will be important to remain competitive.
Search 2020: Signals, Strategy, & Insights
In the coming years, we foresee three skill areas where marketers must develop strong competency. All three will require marketers to broaden their responsibility of strategic decision-making as well as their technical savviness, predominantly within data feed management, customer analysis, and trend tracking. In this section, we will briefly outline each of them and highlight their success criteria.
Algorithms and the meaning of value
With the rise of algorithmic account management, marketers must learn how to utilize the algorithm to optimize towards the right goals to serve the overall business objective. This requires both a deeper understanding of what the right goal is (business objectives), but also how to use different levers (targets, bid strategies, etc.) to reach the objective. This is why a combination of strategic insight, but also technical skills within data feed management and modeling will be essential for the next generation of marketers.
Success criteria for working with value signaling and goal setting:
- Customer Value Segmentation: Understanding the real value of your customers (Customer-centric marketing), e.g. building CLV models to improve target setting and/or budgeting
- Multi-channel strategy: Adopting a multi-channel strategy/perspective and using path or incrementality data to set budgets and targets based on cross-channel optimization goals
- Custom signals: Using custom conversion values to enrich the signals you feed to the algorithm
Interested? Read more in Search 2020 – Algorithms and the meaning of value (Part 2) – Online: 06/02/2020
Climbing the Strategic Ladder
Since operational excellence is providing less comparative value nowadays, marketers should take on more responsibility at other levels of the decision-making process. Taking on tactical and strategic responsibility will enable marketers to leverage Search marketing to aid with business problems outside of its normal purview, such as stock management, market expansion, and branding. There are many areas in which Search marketing can work in conjunction with the rest of the organization, but the first step is cross-departmental communication and planning. Instead of obsessing about CTR, CPA, and Conversion Rate, Search marketers should ask: What core business problems can Search marketing help solve?
Success criterias for moving up the strategic ladder:
- Strategic responsibility: Welcome strategic responsibility and understand the different levels of decision-making (operations v. tactics v. strategy)
- Organizational synergies: Adopt a broad organizational awareness via cross-departmental communication and thereby identify organizational synergies between Search marketing and the rest of the business
- Rethink hiring: Hire for balance between optimizers and innovators (more balanced focus on iterative improvement versus game-changing solutions)
Interested? Read more in Search 2020 – Climbing Up the Strategic Ladder (Part 3) – Online: 19/02/2020
Translating Insight Into Actions
In order to become a strategic partner (both within a company or as an agency) Search marketers must understand how to transfer the insight that the channel illuminates, such as Search trends, user engagement, and demographic data to the rest of the organization. Search as a marketing channel is unique in that it provides instant feedback. The customer sees an ad and decides if it is interesting. Leveraging this opportune situation to transfer insights more broadly into the organization will give way for quicker trend spotting, more data-driven decision-making, and more cohesive understanding of the value marketing brings.
Success criterias for translating insights into actions:
- Trend tracking: Improve dashboarding capabilities and build methodologies for spotting trends more quickly
- Data-driven decisions: Drive decision making with intelligent experimentation and testing rather than organizational bias
- Single Source of Truth: Develop skills within data warehousing and establish a “Single Source of Truth” for the entire company
Interested? Read more in Search 2020 – Translating Insight Into Actions (Part 4)- Online: 04/03/2020
Technical competencies and strategic thinking will surely become more essential for Search marketing specialists and upskilling will be a key success criteria during the transformation period. Over the next couple of weeks, we will dig deeper into each of these skill areas and map out how to excel in them.