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Can Your Digital Marketing Agency Serve Two Masters?


I was brought into a discussion today with a dealer who is considering hiring a new digital marketing agency.  This is a common occurrence within the automotive community since I offer my advice regarding vendors, products, and services to dealership executives seeking a third party opinion.

 

This conversation was interesting in that the agency the dealer principal was entertaining was the same agency that works for their #1 competitor.  This was a multi-franchise store and their competitor had many of the same brands.

 

What I was trying to imagine was what this digital agency would "pitch" to the dealer principal when on some levels they would be competing with themselves.  Is there a practical "Chinese Wall" in an ad agency that confidential information or new strategies would not be overheard or seen by another internal account management team?  I doubt it.

 

Think of paid search for example. It is not uncommon that dealers independently bid on a common base of keywords.  So in some sense, everyone is using SOME of each other's strategy without any direct knowledge.

 

However, innovative conquest strategies, effective video pre-roll scripts, and clever retargeting are definitely not common. Landing page testing and perfecting a brand's "calls to action" for a local market  takes time to develop.

 

So how can one agency work both sides of the conquest game?  Who wins?  Does the second dealer get all the R&D benefits for the local market?  Is there such an advantage?

 

Now keep in mind that there is precedent that OEM's mandate one platform or search provider for certain aspects of digital marketing but should you be hiring the same full service agency that your #1 competitor is using?  Should that agency even offer to work for the top competitor to their current client(s)?

 

What say you?  

 

Brian

 

Brian Pasch, CEO

PCG Digital Marketing

brian@pcgmailer.com

 

P.S.  If you enjoyed this post, please extend the conversation by sharing this on Google+, Twitter, LinkedIn, and Facebook.  

 

Please add me into your Circles on Google+:  Brian Pasch Google+

 

 

 

 

 

 

Views: 707

Tags: digital marketing, oem, vendors

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Comment by Keith Shetterly on June 26, 2012 at 6:42am

Yes, $50million a year set this issue publicly to "crickets" for years now.

Comment by Tom Gorham on June 25, 2012 at 6:42pm

Personally, I would never mess with a $50 million dollar deal.

Comment by Keith Shetterly on June 25, 2012 at 5:49pm

It's about a $50million deal every year.

Comment by Tom Gorham on June 25, 2012 at 5:40pm

Keith, ditto! You know it, I know it, even the OEM knows it.  The emperor's got no clothes. The problem is that the OEM profits from it whether we do or not.  Oh well, time to shut up, eh?

Comment by Keith Shetterly on June 25, 2012 at 4:41pm

Tom, it's a scandal.  Plain and simple.

Comment by Tom Gorham on June 25, 2012 at 4:35pm

Keith, we use that OEM provider (not exclusively).  Recently, I was on our local Patch site.  There was our ad!  And right below it were two of our direct competitor's ads.  All three ads were virtually identical.  Enough said.

Comment by Keith Shetterly on June 25, 2012 at 11:17am

At the least, the use of the same service for PPC is ridiculous.  One of the larger website vendors sells a "basic" PPC to all dealers in the same metro on the same lines.  Same keywords (there aren't that many) and same (poor) ad text.  Essentially, they collect their fees and have the dealers bidding against each other--which makes the spend run out quickly, of course.  And they do this in metros nationally, making tons of money for themselves and Google.  Their answer when probed on this?  "You should spend more!"  Ugh.

It's a disgusting practice, and it's enough for me to avoid this company whenever I can.  


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Comment by Aj Maida on June 25, 2012 at 9:26am

"Now keep in mind that there is precedent that OEM's mandate one platform or search provider for certain aspects of digital marketing"

Yep, and hows that working out. I would not be comfortable with this. As we all know a consumer will drive a long distance (and what always amazed me use up what could otherwise be leisure time) to save small amounts of money just to "win". Now every circumstance is different, Ralph example in Northern Ca. where some people won't "cross the bay".

I am not comfortable with a situation where a company I higher to do anything that would be considered strategic is also doing the same thing for a competitor. I have a tendancy to share my strategic ideas with the agencies I work with and I wouldn't if I knew they were using them with a local competitor. If they want to share my ideas with clients who are not my competitors I have no problem. I think it is us who leads our supporting vendors and  not the other way around. How could this happen if we had to live with the idea that our conquesting ideas were being shared with people who we are trying to conquest?

Comment by Ralph Paglia on June 24, 2012 at 11:48am

Relevant to this topic, I can attest that amongst the most frustrating of experiences I had during my tenure at Tier10 Marketing was all the business we turned away from dealers who wanted to use our company, but because we already represented a direct competitor, we chose to decline. Part of the value we delivered to our existing clients was that we would refuse to represent direct competitors. As "good" as this might sound, there were many times when I felt it was the wrong decision because the perception of competition was far stronger than the reality.  For example, you look at a Ford dealership in downtown San Francisco versus a Ford dealership in Oakland.  On a map they look geographically close, but the reality is that the San Francisco bay separates them and their markets with a geological barrier, and a psychological one as well.

Comment by Jason Manning on June 24, 2012 at 9:13am

Of course not.  Why would a dealer want to follow another dealer at the pace of the same ad agency?  The ideas should come from the dealer itself.  The ad agency is a medium to get them to the consumer.  Why would you want to share your ideas?  The dealer should always remain in control with advertising.  Using your competitor's agency...do you think that is control, ultimately?

As we've always seen in the past, the largest account gets the most attention.  You want to attempt to compete with an account?  Move on.  Even a smaller ad agency with a great idea can triumph over their larger or leading competitor.  It's all in the dealer's ideas.

 

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