I agree.

It just appears that there is disagreement on how CJ gets there.

Building internally will take them several years.

Acquiring an established SEM Agency like Performics gives them instant presence and credibility.

Again, I hope that CJ doesn’t acquire Performics from a competitive standpoint, but it’s gonna happen. At the least, VCLK will make a bid as they should.

For the time being, in my opinion, Pepperjam is the only true full-service agency with an affiliate network.

BTW - according to my sales team, in the 8 years we’ve been doing PPC & SEO for many top tier clients we’ve never once competed with CJ for search business. In fact, to the best of our knowledge we only competed with Linkshare once and we ended up winning that client.

In my opinion, Linkshare and CJ would be better served by just acquiring an SEM or media buying agency.

Kris

As per the SEM division more or less than 5% of overall revenue, I don’t have a clue. But it seems like CJ is moving in the right direction

Thanks for your response.

Pepperjam has been a full-service internet marketing agency for nearly eight years.

The launch of Pepperjam Network makes us a full-service (search, affiliate management, media) internet marketing agency with an affiliate network component.

Besides Pepperjam and Performics who else is there that has those two things (full-service agency & network)?

I agree that CJ and Linkshare are the juggernauts here and have an extensive list of clients to also sell SEM or related services to.

The difference is that you can’t just turn network managers into professional PPC or SEO managers let alone media buyers. At the same time, you can build a staff of professional SEM’s or Media Buyers but it can take several years.

BTW - my argument is based on the debate that’s been going on at the Search-Engine Strategies (SES) conferences for the last two years (buy, build, or white label). White labeling is a short term solution. Building an internal team can take years. Buying is expensive, but it’s the only real solution for companies the size of CJ and Linkshare who are competing with agencies the size of iCrossing, iProspect, and Pepperjam. Note that PJ is the only one with the affiliate marketing network component.

The fact that SEM / SEO / Media Buying represents less than 5% of CJ’s and Linkshare’s business (correct me here if I’m wrong) suggests that they need to acquire a company to be a true full-service player or build a staff internally, which will take them some time.

That’s it. My point is simple. You can not just build an SEM agency overnight because you have a client base from your network technology. However, it is much easier to take your existing agency business and introduce them to a next generation affiliate marketing technology - that’s what Pepperjam did and that’s what differentiates us (among other things) from CJ, Linkshare, and the other networks.

I appreciate the dialogue here.

It’s nice to have CJ’s side of things.

Kris

I understand, but CJ Search is not a well-recognized or established SEM Agency.

We’ve watched as CJ and Linkshare attempted to introduce search over the last few years, but for the most part this hasn’t worked well, at least publically. These divisions of CJ and Linkshare still represent an insignificant proportion of the overall CJ and Linkshare companies (my guess - less than 5%).

In contrast, search [and online media buying in the case of Pepperjam) represents at least 40-50% or more, including staff and revenues, of the overall Performics and Pepperjam business.

Under CJ’s existing model they aren’t considered a major player in search like Performics is, or Pepperjam for that matter.

In my opinion, the only way that CJ can become seriously recognized for search is to purchase Performics or a similar large SEM agency.

I honestly don’t hope you guys acquire Performics because you would be much closer to the Pepperjam model than you are now.

However, I still expect it to happen.

No disrespect to ValueClick’s numerous divisions (i.e. lead gen, shopping comparison, affiliate marketing, “paid inclusion” [whatever hat is these days], etc.), but CJ is not considered a full-service agency in the eyes of the industry and therefore you do not compete on the same level for search business as Performics and Pepperjam does.

I believe it is much more difficult to start out as a network and then attempt to become a full-service agency, unless you acquire the agency.

The reason I believe this is because once you build relationships and hire hundreds of employees based primarily on technology (automation) the client comes to rely on you for just that. For other services, such as search and online media buying, most advertisers tend to favor companies with an established presence in these areas - CJ (and Linkshare for that matter) does not have an established presence, while Performics and Pepperjam does.

Thanks for your comments.

http://www.cj.com/advertisers/cj_search.html