At TangoCode, our customers are constantly asking us whether they should build or buy a custom SEM reporting solution. This is such a common dilemma. There are big differences between the two approaches, and because each agency is unique, there’s a lot of research necessary to ensure you choose the right one for you. With more than 5 years’ experience in the SEM reporting business, we’ve helped many agencies just like yours determine whether to build or buy their SEM reporting solution.
If you are currently going back and forth on the build-versus-buy debate, read on. Here are some things you need to consider to make the best choice for your agency.
Building Your Own Custom SEM Reporting Solution
If you are ready to consider a custom SEM reporting solution, you have two primary options. You can do all of the development in-house, or you can outsource the development to a third-party technology partner.
Building An SEM Reporting Solution In-House
If you choose to build in-house, here are some things to consider:
- Experience With Industry APIs: If you have a well-equipped team that’s well-versed in your industry APIs, an in-house solution may be feasible.
- Opportunity Cost: If you reallocate your agency’s time and resources to build an SEM reporting solution, how will that affect your client contracts? Do you have the manpower to spare? Will employees work on development during overtime hours
- Best Practices: Does your team have a solid understanding of industry best practices? Do they have the necessary knowledge to design a usable, practical reporting solution that will reflect the proper metrics?
If you do decide to build in-house, platforms like Microsoft’s Azure and Amazon’s AWS allow your developers to easily build your reporting system without the need for physical servers on the premises.
Who Is Building a Solution In-House for?
The build-in-house approach is best suited for agencies with highly skilled team members who can take on the development process without sacrificing best practices or time on client accounts.
Working With a Third-Party Partner To Create An SEM Reporting Solution
If you know you want a custom solution, but you lack the in-house experience to design one, you can work with a third-party technology partner.
If you choose a third party technology partner, you’ll want to consider:
Industry Experience & Best Practices: As with an in-house custom-build solution, it’s important to make sure your chosen third-party partner has experience in your industry and with digital marketing solutions, and a knowledge of development best practices.
- Integration: Do you have existing systems that will need to integrate with a new SEM system? If so, make sure the technology partner can design a tool that allows for easy integration.
- Breakeven Cost: You’ll need to consider the breakeven cost for hiring a third party technology partner. Consider the total amount it would cost for two to three employees to design the system in-house (at their full time salary). Anything above this cost is too expensive. (Also consider the long-term ROI of a proprietary tool compared to one with a monthly subscription cost, which are generally based on growth metrics like number of accounts.)
- Growth and Scalability: Your agency is constantly growing and changing. Make sure you select a third-party technology partner who understands your future growth potential and is willing and able to work with you to design a custom solution that will grow with you.
- Goals: Make sure you work closely with the third-party technology partner to ensure that they understand your specific goals and have a solid plan to accomplish them. Some technology partners offer a what is essentially a “one-size-fits-all” approach, which may not be the best option for your agency.
- Portfolio: Does the technology partner have a portfolio that matches your agency’s goals and APIs? Make sure they are able to work well with your team and your long-term growth.
Who Should Work With a Third-Party to Building a Custom Solution?
This approach will most benefit agencies that want a custom-built SEM reporting solution but lack the dedicated resources and technical skillset to develop them in-house.
Thinking Inside the Box: Buying an SEM Reporting Solution
There are some benefits and risks to purchasing a pre-built SEM reporting solution. If you’re planning to buy, consider the following:
- Best Practices: Best practices are already incorporated into off-the-shelf SEM reporting solutions. This is a big pro for new agencies that don’t have the finances to fund a custom-built system or who are not yet familiar with their industry’s best practices.
- Cost-Effectiveness: Pre-built solutions are usually less expensive in the short-term than custom-built solutions — but keep that long-term return on investment (mentioned above) in mind.
- Short-Term: A “one-size-fits-all” approach is a great short-term option for agencies that want to determine what they need in a custom SEM reporting solution before they invest in a custom-built system.
- Security: When you work with an off-the-shelf solution, you have to work with their cloud software. This can pose a security threat to your clients’ and your own business’s proprietary information.
- Growth Potential: As you grow, will your off-the-shelf reporting solution have the capacity to grow with you? If not, what is the switching cost to moving to a larger system?
- Flexibility: Pre-designed SEM reporting solutions may not offer the flexibility you or your clients demand. Does the system allow for customization? Do custom reports matter to you or your clients?
- Volatility: Consider what would happen if your chosen reporting solution carrier were to fail. Would you have a disruption of service? Would you have to start over from scratch and lose valuable data along the way? (Dasheroo clients learned this lesson the hard way when Dasheroo went under and was unable to obtain more financing. The company was eventually acquired, but this situation could have easily been worse for existing agency clients.)
The “buy” approach can be a good fit for new agencies that want an SEM reporting system and need the fundamentals in place, but may not be at a point where they can invest in a custom-built system.
They are also a good solution for large agencies that are no longer in a growth stage, and that do not need a lot of flexibility or customization — or ready to move on to more robust and enterprise solutions like Adobe Marketing Cloud or Salesforce Marketing Cloud.
A custom-built SEM solution isn’t right for every business. But if you think it might be the best approach for your agency, contact TangoCode to learn how we can develop a custom-built system to meet your specific goals.