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| Allegory (subtle…) of the Adwords Wholesaler |
Ok, the title is a bit sensationalist… But what honest worker has never been exasperated by the smart alecks who take advantage of loopholes in the system to make easy money, to the detriment of their own clients?
Since Jean-Marc and I created Eureos, our mission has been to promote SMEs through the web. For us, that means implementing an effective web strategy to bring our clients quote requests. These requests must be qualified and exclusive, with a single objective: maximize sales at the end of the chain. One request = one lead, and we tally the score at the end of the month (with the right CRM).
Web wholesalers play against their clients
However, in this niche, we are facing a new kind of competitor: Adwords Wholesalers (let’s call them A.W.). Their business? Buying Adwords keywords and reselling the leads obtained this way to several competing companies. To do this, they use websites specially created for the occasion, which generally boil down to two pages: a landing page and a contact form. They choose their themes as the wind blows and fashions change.
A good deal for clients?
At first glance, their clients feel like they’re getting a good deal: the cost per lead is generally lower than what the company obtains through its own means (and even then, not always, even though they are resold to 4 or 5 other competitors), and implementation is immediate.
Except that… when we bring in a lead through the company’s website, the prospect has deliberately chosen to contact that company and not another one (or else separately). In terms of return, that generally means 10 to 15% “waste.” However, with contacts obtained through A.W.s, not only is the request less targeted (30 to 40% waste), but the competition is also on the case, which suggests catastrophic conversion rates. This poor lead quality has a cost for the company: the lost time of its field sales force.
Another perverse effect: by giving money to A.W.s, you de facto weaken your own Adwords campaign: bids go up, and it is difficult to fight alone against a pooled budget.
Sometimes the good guys win in the end
Fortunately, there is some justice: since we provide clients with the means to measure their sales effectiveness through a CRM, they quickly realize that the conversion rate is not the same. But in the meantime, the wholesalers have reduced their costs, found other clients, and continue to monopolize the top spots in Adwords. Once they have exhausted one line of business, they will move on to the next.
