The Forrester Wave : Search Marketing Agencies, Q1 2016

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1 The Forrester Wave : Search Marketing Agencies, by Collin Colburn Why Read This Report In our 23-criteria evaluation of search marketing agency providers, we identified the 10 most significant ones 360i, Acronym, Catalyst, Ethology, icrossing iprospect, Merkle, Performics, Rise Interactive, and Zog Digital and researched, analyzed, and scored them. This report shows how each provider measures up and helps B2C marketing professionals make the right search agency choice. Key Takeaways 360i Leads The Pack Forrester s research uncovered a market in which 360i leads the pack. Catalyst, Rise Interactive, Merkle, icrossing, Acronym, and iprospect offer competitive options. Performics is a viable contender. Zog Digital and Ethology lag behind. Search Marketers Need Search Specialists Search marketers need an agency that has search at its core in order to address top challenges and stay on top of trends. Search agencies act as specialists and advise their marketer clients on top search marketing decisions. Organic Visibility, Paid Search, And Corporate Vision Are Key Differentiators We included agencies that balance both organic visibility and paid search services and found that their approaches for both vary greatly. Additionally, each agency s vision defines its future state. forrester.com

2 by Collin Colburn with Shar VanBoskirk, Wei-ming Egelman, and Laura Glazer Table Of Contents Notes & Resources Every Search Marketer Needs A Search Marketing Agency But Search Agencies Struggle To Fulfill Discovery Needs Search Marketing Agencies Evaluation Overview Evaluated Vendors And Inclusion Criteria Vendor Profiles Leaders Strong Performers Contenders Challengers Supplemental Material Forrester conducted service evaluations in January 2016 and interviewed 10 agencies for this report: 360i, Acronym, Catalyst, Ethology, icrossing, iprospect, Merkle, Performics, Rise Interactive, and Zog Digital. Related Research Documents Brief: What s New With SEO? The Forrester Wave : Search Marketing Agencies, Q Forrester Research, Inc., 60 Acorn Park Drive, Cambridge, MA USA Fax: forrester.com 2016 Forrester Research, Inc. Opinions reflect judgment at the time and are subject to change. Forrester, Technographics, Forrester Wave, RoleView, TechRadar, and Total Economic Impact are trademarks of Forrester Research, Inc. All other trademarks are the property of their respective companies. Unauthorized copying or distributing is a violation of copyright law.

3 Every Search Marketer Needs A Search Marketing Agency The nature of search marketing has shifted from reaching customers through a singular channel (traditional search engines) to enabling discovery across all platforms, media, and outlets where consumers find. This makes it incredibly complex to ensure organic visibility and increased performance from cost-per-click media. Search marketers look to an agency partner that is specialized in search and can help enable discovery of their brands, products, and content. Specifically, marketers lean on their search agency for: Resources. Many marketers simply do not have the number of skilled in-house staff needed to maintain and improve search engine optimization (SEO) and paid search. In fact, we found many firms outsource all of their search marketing efforts (see Figure 1). In this evaluation, more than a quarter of client references have no staff for SEO or paid search. 1 Technical SEO. Most marketing teams lack the technical chops to effectively optimize their sites for search engines and a user s experience. We found that over two-thirds of client references used their search agency to accomplish tasks like crawling their sites for speed and index-ability, tracking organic web traffic, and link building (see Figure 2). More efficient paid search management. Advertisers also turn to agency partners to improve the performance of paid search investments that are beginning to tap out on returns. 2 In fact, at least 84% of client references told us that they rely on search agencies to craft their bid strategies, optimize paid search budgets and media performance, and even execute buys (see Figure 3). Biddable media support. Search marketers look to other forms of media, in addition to search engines, to enhance visibility for their brand. A search agency is most commonly used to execute on performance-based media buys. Of this study s 64 client references that manage paid search, 48% told us that they use their search agencies to buy ads in non-search engine formats like display and social. 2

4 FIGURE 1 More Than A Quarter Of Marketers Outsource Their Search Marketing Operations How many internal staff work on search engine optimization (SEO) initiatives? How many internal staff work on paid search initiatives? * 4 or more people 23% None. We outsource to an agency or vendor 26% 4 or more people 18% None. We outsource to an agency or vendor 30% 1-3 people 51% 1-3 people 53% Base: 61 marketers who manage SEO *Base: 64 marketers who manage paid search Note: Percentages may not total 100 because of rounding. Source: Forrester s Search Marketing Agencies Forrester Wave Online Survey FIGURE 2 More Than Two-Thirds Of Marketers Who Manage SEO Rely On Agencies For Technical SEO Thinking only about SEO and improving your organic visibility, what services do you rely on your search marketing agency to perform? Crawling your site for technical issues related to speed, coding, etc. Recommending content opportunities on site Tracking and reporting organic web traffic Conducting keyword research Optimizing site content for preferred keywords 92% 90% 89% 85% 85% Conducting competitive rank analysis 75% Link building 67% Base: 61 marketers who manage SEO Note: Multiple responses accepted. Only showing top seven results. Source: Forrester s Search Marketing Agencies Forrester Wave Online Survey 3

5 FIGURE 3 At Least 84% Of Client References Turn To Their Agencies For Efficient Paid Search Management Thinking only of paid search, what services do you rely on your paid search marketing agency for? Optimizing paid search budget Conducting keyword research Tracking and reporting traffic from paid search Optimizing performance of paid search campaigns Crafting bid strategy Executing buys 94% 92% 89% 89% 86% 84% Base: 64 marketers who manage paid search Note: Multiple responses accepted. Only showing top six results. Source: Forrester s Search Marketing Agencies Forrester Wave Online Survey But Search Agencies Struggle To Fulfill Discovery Needs Search marketing agencies provide lots of value for their clients in SEO and paid search. But the agencies in this category can do better to support their clients with tools and frameworks to aid in customer discovery. Search agencies should improve in the following areas: Content strategy. The agencies in this evaluation talked a lot about the importance of relying on a single partner for high-quality content and search marketing support. And rightfully so, as promoting content in traditional and non-traditional search engines is harder than ever. 3 But most search marketers don t use their search agencies for content strategy: Only 39% of reference clients told us they use their search marketing agency to create content. As one client reference told us, Our agency really needs to develop better skills in content marketing... and then we ll use them for our content needs. Understanding search s impact on other media. Search marketers have broadened their charter to include social networks, online directories, and other platforms. Because of this, marketers need to understand the synergies between media. But search agencies fall short in helping their clients with this. References gave their search agencies an average quality score of 3.9 out of 5 for the agency s ability to correlate activity across multiple media which ranked in the bottom quarter of all agency services. One client reference complained, I spend way too much time trying to figure out how other media was impacted by a change we made in our search strategy. 4

6 Identifying and prioritizing specific discovery outlets. There are myriad search engines, mobile apps, and comparison-shopping sites where consumers can find new products or brands. And search marketers need help figuring out which outlets will provide the greatest findability. As a client reference from a major retailer put it, We can t keep up with all the places where our customers research and buy. But search agencies have been slow with tools to help identify where a marketer should invest budget or resources to improve visibility. Only Catalyst even partially supports this need. Its eshelf tool identifies search engines, media, and social networks where a marketer s content or products appear. Search Marketing Agencies Evaluation Overview To assess the state of the search marketing agency market and see how the agencies stack up against each other, Forrester evaluated the strengths and weaknesses of top search marketing agencies. After examining past research, user need assessments, and vendor and expert interviews, we developed 23 evaluation criteria, which we grouped into three high-level buckets: Current offering. Each agency s position on the vertical axis of the Forrester Wave graphic indicates the strength of its current market research approach, media, organic visibility, and paid search capabilities. These criteria also evaluate agency collaboration tools and processes, account management functions, reporting and analytics methods, and client satisfaction. Strategy. An agency s position on the horizontal axis indicates Forrester s assessment of its strategy and approach to the market. We compared the corporate strategies of the agencies based on their visions, road maps, and global employee retention rates. Market presence. To determine the size of each agency s search marketing business, we evaluated its search marketing revenues, number of employees and clients, and geographic footprint. Evaluated Vendors And Inclusion Criteria Forrester included 10 agencies in the assessment: 360i, Acronym, Catalyst, Ethology, icrossing, iprospect, Merkle, Performics, Rise Interactive, and Zog Digital. Each of these agencies has (see Figure 4): Search marketing at its core. In order to showcase agencies that are search specialists, we screened only agencies that showed 20% of revenues coming from search services. This means that big digital agencies with relatively small search practices, like Razorfish, were ineligible. Experience supporting SEO and paid search. A comprehensive search marketing strategy should take into account both organic and paid tactics. We screened out agencies such as Neo@ Ogilvy that provide only SEO or paid search, but not a balance of both. 5

7 Dedication and momentum in search. Because agencies are expanding their offerings outside of their core business, we chose to include agencies that are dedicated to and winning new business in search. This means companies that did not win enough new business for SEO and paid search in 2015 to account for 3% of the agency s client base, like Location3 Media, did not qualify. Large enterprise clients. Each agency in this Forrester Wave evaluation has 70% of its client base derived from enterprise-class firms. Smaller agencies like Wpromote were screened out because of this. FIGURE 4 Evaluated Vendors: Vendor Information And Selection Criteria Vendor name 360i Acronym Catalyst Ethology icrossing iprospect Merkle Performics Rise Interactive Zog Digital Evaluated in Vendor selection criteria At least 20% of the agency s revenue must come from search marketing services. At least 15% of the agency s clients must work with the agency for both paid search and SEO. At least 3% of the agency s clients must be new (as of January 1, 2015) and work with the agency for both paid search and SEO. At least 70% of the agency s clients must be enterprise-sized. 6

8 Vendor Profiles This evaluation of the search marketing agency market is intended to be a starting point only. We encourage clients to view detailed product evaluations and adapt criteria weightings to fit their individual needs through the Forrester Wave vendor comparison tool (see Figure 5). FIGURE 5 Forrester Wave : Search Marketing Agencies, Q1 16 Challengers Contenders Strong Strong Performers Leaders Current offering iprospect Performics Catalyst Rise Interactive icrossing Acronym 360i Go to Forrester.com to download the Forrester Wave tool for more detailed product evaluations, feature comparisons, and customizable rankings. Merkle Ethology Zog Digital Market presence Weak Weak Strategy Strong 7

9 FIGURE 5 Forrester Wave : Search Marketing Agencies, Q1 16 (Cont.) Forrester s Weighting 360i Acronym Catalyst Ethology icrossing iprospect Merkle Performics Rise Interactive Zog Digital CURRENT OFFERING Market research Media Organic visibility Paid search Collaboration Account management Reporting and analytics Client satisfaction Cost and pricing structure STRATEGY Corporate strategy and vision 50% 10% 10% 20% 35% 5% 10% 5% 5% 0% 50% 100% MARKET PRESENCE Search revenues Number of employees Client base Geographic traction 0% 25% 25% 25% 25% 2.75 All scores are based on a scale of 0 (weak) to 5 (strong) Leaders 360i. Four-time Leader in this study, New York City-based 360i repeats this time because of its support for user discovery across multiple search, social, mobile, and content platforms. Specifically, the agency offers creative, social, programmatic, communications planning, and brand strategy services. And it owns a host of proprietary tools to automate content monitoring, retargeting list creations and real-time bid and creative adjustments based on external data sources like weather in outlets such as Instagram, Pinterest, and Waze, among others. Domestic marketers 360i only has one international office who want to move past traditional paid search and SEO will like this firm s investment in envelope-pushing staff and innovation. Strong Performers Catalyst. GroupM s specialist search marketing agency, Catalyst, debuts in this study as a strong performer because of its leader-level organic visibility, paid search, and biddable media support. Client references like this agency s use of tools to optimize content across traditional 8

10 and non-traditional search engines. And Catalyst earns perfect scores for its paid media tools, optimization strategy, quality, and results. Catalyst falls short of being a leader because of its small account management team and only average vision for the future of search marketing. This firm is an easy yes for marketers who already rely on GroupM for media management, but we d recommend it for operationally-minded marketers (Catalyst shows a penchant for consumer goods manufacturers) who want one partner to manage both SEO and paid search. Rise Interactive. Rise Interactive places as a Strong Performer in its first search marketing agency Forrester Wave evaluation because of its unique treatment of search marketing investments like a financial portfolio. Specifically, the Chicago-based firm models the media mix, budget allocation, client and agency staff utilization, and interplay between paid search and SEO that will yield optimal return. Client references give Rise high marks in market research, organic visibility, paid search tools, and reporting. The optimization-driven approach of this firm doesn t suit everyone, however. Companies that need more holistic support will find that Rise s account management, international experience, and efforts to manage collaboration fall short of competitors. Merkle. Though it s a brand you might know better for its database marketing and customer engagement strategy services, Merkle has a search marketing and performance media agency formed through the acquisitions of Impaqt and RKG. This Strong Performer informs client strategy with its proprietary DataSource tool that compiles data from many different sources, allowing it to have behavioral data on 95% of US households. And client references give high marks to Merkle s organic visibility and multichannel reporting capabilities. This agency does fall below average in this study for paid search, primarily due to low scores for its optimization strategy and work quality. Even so, data-savvy pioneers will like Merkle s analytics chops and its aim to improve brand discoverability on intelligent agents like Cortana, GoogleNow, and Siri. icrossing. Veteran digital and search marketing agency icrossing makes a resource-rich partner for large direct response marketers who need support primarily for acquisition efforts. True to its SEO legacy, icrossing earns great marks for organic visibility. And its best scores come from the quality and results of its paid search ads. icrossing also boasts rich customer insights capabilities based on user data from its parent Hearst and a proprietary machine learning tool built to predict search behavior. Worth noting however, is that icrossing isn t the innovator we found it to be in previous evaluations. Its road map includes initiatives already implemented by competitors. And its vision to be a marketing agency for the modern world lacks uniqueness and executional specificity. Acronym. Acronym brings a consulting-partner model rather than an agency-feel to this evaluation. Note that this firm offers staff augmentation for the right price to clients who need additional headcount, expertise, or help getting a fast start. Client references love this hands-on approach to total-business transformation. Acronym ties for the highest customer satisfaction scores in the study, in part due to accessible account management, executive involvement in account strategy, and its emphasis on mapping and influencing critical moments in a customer s decision. 9

11 But marketers who want a more straightforward search marketing partner will be frustrated by Acronym s diffusive tendencies. It demonstrates limited experience bidding in media outside of paid search and programmatic display, and its paid search optimization strategy and quality of work for paid search earn low scores. iprospect. Search marketing stalwart iprospect now also includes stylings from Covario, an agency it acquired in 2014, to beef up its West Coast operations and SEO offering. This is a stronger version of iprospect; its market research, organic visibility methods, paid search tools, and work quality for SEO and paid search earn top marks. Large multinational marketers will value iprospect s strong collaboration processes and broad geographic footprint. But count on some ongoing growing pains with this firm its corporate road map is looser and employee retention rate lower than others. Contenders Performics. While we like that this firm has consistently focused on driving performance by creating dynamic, personalized, and optimized experiences across owned, earned, and paid digital touchpoints over the years, Performics did not demonstrate the boldness we expected of it based on past evaluations. 4 This, as well as low scores for SEO results, paid search work quality, and reporting and flexibility, place Performics as a Contender this year. Conservative multinationals looking for reliability will value this firm s global staying power current clients and employees do: Performics boasts top scores for account management and its global employee retention rate. Challengers Zog Digital. The smallest agency we evaluated, Zog Digital, debuts in this study as a Challenger primarily because its scale and experience don t measure up to incumbents. It owns no specific tools or processes to manage collaboration, has fewer account management resources than competitors, and owns one of the lowest Net Promoter Scores in this evaluation. 5 But the firm has some fundamentals down: quality scores for organic visibility work and results are tops. Consider Zog Digital if you are new to search or seek an alternative to those more established players to get a fresh approach or working style, for example. Ethology. Boutique agency Ethology s limited scale and structure land it as a Challenger in this year s evaluation. It hasn t yet inked formal methodologies for how to prioritize discovery outlets or optimize paid search budgets for different marketer types. And it struggles to clearly and consistently articulate its strategic vision. However, based on the financial and emotional commitment of this firm s leadership, we hope Ethology will evolve from consultants who do anything a client asks into an agency that owns competencies to deliver on deliberately determined service areas. In the meantime, tap it for content marketing support. Eighty-five percent of client references use Ethology for content creation. 10

12 Engage With An Analyst Gain greater confidence in your decisions by working with Forrester thought leaders to apply our research to your specific business and technology initiatives. Analyst Inquiry Ask a question related to our research; a Forrester analyst will help you put it into practice and take the next step. Schedule a 30-minute phone session with the analyst or opt for a response via . Learn more about inquiry, including tips for getting the most out of your discussion. Analyst Advisory Put research into practice with in-depth analysis of your specific business and technology challenges. Engagements include custom advisory calls, strategy days, workshops, speeches, and webinars. Learn about interactive advisory sessions and how we can support your initiatives. Supplemental Material Online Resource The online version of Figure 5 is an Excel-based vendor comparison tool that provides detailed product evaluations and customizable rankings. Data Sources Used In This Forrester Wave Forrester used a combination of three data sources to assess the strengths and weaknesses of each solution. We evaluated the vendors participating in this Forrester Wave, in part, using materials that they provided to us by March 14, Vendor surveys. Forrester surveyed vendors on their capabilities as they relate to the evaluation criteria. Once we analyzed the completed vendor surveys, we conducted vendor calls where necessary to gather details of vendor qualifications. Customer reference calls and surveys. To validate product and vendor qualifications, Forrester also conducted reference calls with three of each vendor s current customers, and administered online reference surveys to seven to nine of each vendor s current customers. 11

13 The Forrester Wave Methodology We conduct primary research to develop a list of vendors that meet our criteria to be evaluated in this market. From that initial pool of vendors, we then narrow our final list. We choose these vendors based on: 1) product fit; 2) customer success; and 3) Forrester client demand. We eliminate vendors that have limited customer references and products that don t fit the scope of our evaluation. After examining past research, user need assessments, and vendor and expert interviews, we develop the initial evaluation criteria. To evaluate the vendors and their products against our set of criteria, we gather details of product qualifications through a combination of lab evaluations, questionnaires, demos, and/or discussions with client references. We send evaluations to the vendors for their review, and we adjust the evaluations to provide the most accurate view of vendor offerings and strategies. We set default weightings to reflect our analysis of the needs of large user companies and/or other scenarios as outlined in the Forrester Wave evaluation and then score the vendors based on a clearly defined scale. We intend these default weightings to serve only as a starting point and encourage readers to adapt the weightings to fit their individual needs through the Excel-based tool. The final scores generate the graphical depiction of the market based on current offering, strategy, and market presence. Forrester intends to update vendor evaluations regularly as product capabilities and vendor strategies evolve. For more information on the methodology that every Forrester Wave follows, go to Integrity Policy We conduct all our research, including Forrester Wave evaluations, in accordance with our Integrity Policy. For more information, go to Survey Methodology Forrester s fielded its Search Marketing Agencies Forrester Wave Online Survey to 77 search marketers who are client references of search marketing agencies participating in this Forrester Wave. Forrester fielded the survey during. Exact sample sizes are provided on a questionby-question basis. This data is not guaranteed to be representative of the population, and, unless otherwise noted, statistical data is intended to be used for descriptive and not inferential purposes. While nonrandom, the survey is still a valuable tool for understanding where users are today and where the industry is headed. Endnotes 1 Twenty-six percent of client references told us they have no staff for SEO, and 30% said they use their agency to do everything for paid search. Source: Forrester s Search Marketing Agencies Forrester Wave Online Survey. 2 For more information on Forrester s forecast of digital marketing trends for the next few years, see the US Digital Marketing Forecast, 2014 To 2019 Forrester report. 12

14 3 The more content assets a marketer creates, the better chance it has of being found in today s SEO world. See the Brief: What s New With SEO? Forrester report. 4 Source: Executive briefing held with Performics during. 5 Net Promoter and NPS are registered service marks, and Net Promoter Score is a service mark, of Bain & Company, Inc., Satmetrix Systems, Inc., and Fred Reichheld. 13

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