Posted April 14, 2011 8:53 am by with 11 comments

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The recent 2011 annual report from SEMPO (Search Engine Marketing Professional Organization) and Econsultancy gives some data that can make one wonder a bit. The survey is of mostly North American companies and agencies in the search game.

The question I have is about the use (or dare I say popularity) of the in-house SEO model. In-house SEO’s are just that: staffers on a company payroll that have the job of search engine optimization for an organization’s particular needs. SEO agencies ran the show for the start of the SEO era but as more and more people became skilled in the SEO arts more companies decided to bring that function in house. The chart below, however, shows the cycle might be possibly changing again.

The number of companies polled using less than 10% of their SEO budgets for agencies (which is virtually a complete in-house play) dropped from 62% to 50% from 2010 to 2011.

So does this mean that the in-house model is dead? Not by a long shot but it could indicate that the cost of carrying an in-house team has been a focus of cost conscious companies during the recent economic times. Companies may be willing to give up a lot of control (and many would argue quality) by going back to agencies because carrying pay rolled employees is bigger than just a salary and supplies. Most companies add at least 35% of an employee’s total salary to get the total cost of carrying that person with the extra money representing benefits etc.

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Everything in life and business is cyclical so maybe this is just the natural order of the SEO game. We really have so little history of the industry to make any conclusions about how these cycles might play out but in the hyper accelerated world of the Internet maybe we are there already.

One other thing the report pointed out is what SEO’s of all stripes consider to be important with regard to doing their jobs.

The rise of the mobile net is on the mind of the most search marketers with nearly 80% saying it is significant to their efforts. The biggest ‘non-issue’? The Bingahoo alliance with 55% of the respondents saying that it was not significant to them. Looks like Bing has their work cut out for them.

So what is your take on the in-house SEO vs agency issue? Is the cost of the in-house play worth the return one can get from having dedicated resources for the mission critical SEO play? Should a company look at just the cost of having staff or should they be a bit more discerning about what the value is as opposed to just the expense? Is it that maybe in-house teams aren’t returning the results that were promised? Is it that the sample for the study is not representative (in your opinion)?

Let’s hear your voice on this one.

You can get a sample of the report or purchase the full report here.

  • Richard Vaughan

    Without having explicit SM spend I’m not sure it can be argued confidently that the data here shows that in house SEO work is being shunned for agency work. One could equally argue that in-house SEOS are taking advantage of the unqiue strengths of agencies to augment their own strategies rather than replacing them.

  • My gut reaction is that when large organizations pulled folks in-house, they initially cut the agency spend completely, and now it’s evolving into a mixed model where the in-house SEO manages the external resource on an ad hoc basis rather than the full-blown (and much more expensive) agency relationship. The in-house SEO has realized what they do and don’t need from an agency, and outsourced a portion rather than the complete SEO program.

    • Good points both @Richard and @Dan. There is never likely to be a clean black and white divide between in-house and agency SEO. A hybrid approach could serve to help companies keep in-house staffing to a minimum and allowing them to utilize particular agencies for their strengths rather than the full suite of services. This will mean that agencies need to be more willing to ala carte services and the one of the main skill sets of an in house SEO will be to manage various vendors which is often much different from being a true SEO.

      Thanks for the input.

      • Another feather in the cap of an in-house SEO I would say is the ability to measure independently the effectiveness of external work. This tends to keeps the SM agencies honest and leaves the in-house SEO with the flexibility to pick and choose the right partners and advise the business of the real ROI of these relationships. Even in my relatively short career as an in-house SM I’ve been shocked at the hugely varying levels of competency and value-add that agencies and subcontractors can provide.

        • Great points guys as I was involved in such a scenario just yesterday as a different division of the company I work for contacted me and asked me to look over a proposal that an agency sent for some SEO work. I was then able to advise of the good, bad, and missing in that proposal to basically polish it up to keep the agency in line.

          If someone isn’t available in-house to advise in situations like that, it’s highly likely that businesses can get taken advantage of by some agencies claiming to provide SEO services. Granted, there are many SEO agencies out there that know what they’re doing and provide legit services….but unfortunately there’s a crop of “marketing” agencies that slap on “SEO” to their offerings and charge too much for too little.

  • I’d be interested to see if the in-house SEO manager was brought in or promoted from within the marketing department. It’s possible that larger companies initially made an employee who just had a marketing background, not specifically in SEO, responsible for their SEO. It might have been an attempt to save money when the economy went bad, but now companies are starting to outsource again.

  • I think you guys have hit it right on the head. I know personally I came in-house as just an SEO and now manage relationships with outside agencies for PPC, content,etc. We also realized it’s more cost-effective to outsource the things we don’t have the resources for vs bringing someone in house.

  • My personal thought on this one is that many of the mid-top end SME’s as well as larger organisations do have some sort of in house element to assist with SEO. For me though I think the real argument is how far does SEO go?

    I firmly believe you have to look at it as online marketing as a whole, especially if you have some sort of in house strategy you have to cover all angles which isnt always possible due to time and resource.

    Ideally if you have a client with an in house team it may be they can cover the on page activity such as content, blog posts, articles etc and that the agency could deal with social media management, article and pr syndication.

    I do not think the shine is coming off, just that companies are now realising there is more than just “SEO” needs looking after.

  • I’m biased on this as I am an in-houser, but my experience is that companies can have a much more effective search marketing plan if they have at least 1 person in-house that lives and breathes the industry jargon, trends, news, relationships, etc.

    BUT….I believe the most successful companies learn to balance the necessary tasks and begin to realize which of those tasks are better left to an outside agency since agencies can add an entirely different bag o’ tricks and capabilities. I don’t think it should come down to one or the other, but instead an effective blend of whatever resources can get the job done most effectively and efficiently.

  • I agree completely with Dan Perry. I believe companies are finding in-house talent necessary to build out the program and educate internally while the agency compliment helps internal staff scale.

  • Rajesh Kumar

    I think companies should hire a SEO on their own payroll, This way a dedicated SEO will be able to know about the company’s products and services in a better way and can perform the things more efficiently