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Last month, I tweeted that:

Twitter’s coming ad platform is going to create quite a bit of tension between digital agencies and their search-specific counterparts.

A few people asked me to elaborate on that point and given that Twitter unveiled its Promoted Tweets product this week, it seems like a good time to explain what I meant.

Ad agency execs will be among the first to admit that their companies have a miserable track record when it comes to identifying new trends.  And even when they have sensed shifts in the market, they’re generally so slow to react to them that they end up addressing the problem with the same response anyway – through the acquisition of companies they probably never should have let exist in the first place. 

That happened in the late 90’s when traditional agencies, thinking online was a fad that didn’t warrant significant investment, were forced to acquire interactive agencies.  Amazingly enough, those same interactive agencies then went on to largely ignore the emergence of search, only to watch it rise to account for nearly half of all online ad spend.  Once again, ad holding companies were in a position where they had no choice but to acquire search marketing firm’s (SEM’s), not only because they were interested in capturing the upside associated with all the dollars going to search, but as importantly, because their lack of search expertise created potential downside by putting existing client relationships at risk too. 

So, when social media marketing (SMM) started to appear as though it was going to be the next big thing a couple of years ago, digital agencies seemed determined not to let history repeat itself — they moved aggressively to build out a set of services that would make them competitive in SMM.  They weren’t alone, of course.  Companies from all corners of the Marketing Communications world, including PR firms, creative agencies, and yes, search marketing firms, did exactly the same thing.  The fact that social media platforms hadn’t yet created paid ad programs that provided real benefit to marketers meant that most agencies focused on using “earned” media tactics instead, and every type of agency could make a compelling case as to why SMM was most directly aligned with its legacy business. 

This ultimately created a scenario where most holding companies were hesitant to position any one of their agencies as its SMM specialist.  Instead, they’ve allowed agencies to compete with one another with the expectation that the market would ultimately sort itself out and help them decide the best way to move forward over the long-term.   

A series of recent developments would indicate that order is finally being created in in the world of social media.  First, Promoted Tweets (understandably) look an awful lot like Google’s paid search programs — both AdWords and AdSense.  This means that marketers who use the platform will need to be experienced in the art and science of services ranging from keyword research, to writing ad copy featuring strong calls to action, to real-time bidding in auction-based environments that reward relevancy.  Using Promoted Tweets at scale is also going to require systems (i.e. real technology) that can aggregate, process, and report on massive amounts of data.  

Facebook’s “Ads” program, which also bears more than a few similarities to paid search, is starting to gain some traction too.  And Facebook knows much of its future growth is going to depend on its ability to meet the needs of direct response advertisers.  For that reason, it’s started looking to the search marketing community for guidance on how to best develop and then evolve its platform.  All Facebook reported that Facebook execs at last month’s SMX West (a search marketing conference) “expressed a deep appreciation for the sophisticated analytics SEM professional use to hone campaign performance at scale.” 

All this reminded me of a 2005 blog post I wrote in response to criticism that search was too narrow a category for an agency to focus on exclusively and that it would ultimately be absorbed by larger brand strategies.  

Back to the original question we were faced with [when starting Reprise Media] - of whether search is a big enough business for search engine marketing firms - it’s actually become irrelevant. SEMs haven’t had to migrate towards offering other ad programs because the market has actually migrated towards them instead. We’ve seen this manifest in bids on ads in RSS, bids on behavioral advertising, bids on the “automotive” category in Quigo’s AdSonar network…It’s like one broad pool of content networked together by advertising.

At this stage, you can add Promoted Tweets and Facebook Ads to that list. And given the parallels between the histories of search and social media, it seems obvious that SMM’s real growth is going to be tied to these paid programs.  While digital agencies can continue to position themselves as experts in the services that have historically been associated with earned SMM (conversation monitoring, sentiment analysis, creation and management of social media profiles, etc.), it’s difficult to see how they can make the case that they’re best equipped to handle paid media as well.

And this is exactly what’s going to create the tension I previously alluded to.  Digital agencies finally anticipated the emergence of a new category and took proactive steps to make sure the opportunity didn’t slip away.  But given the way platforms are evolving, it’s clear that their search-specific counterparts are actually better positioned to manage SMM.  It will be fascinating to see whether digital agencies continue trying to compete with partners for something that can no longer be considered a core competency, knowing the alternative is watching what could be massive amounts of revenue go somewhere else yet again.
  
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