Ethics of Sectoral Based SEO Services

Ethics Of Sectoral-Based SEO Services

By Richard Hearne
Expert Author
Article Date: 2007-08-07

As titles go, this post title is sure to have some people scratching their heads - ‘What is this guy on about now? I can hear some people saying.

Well if you choose to bear with me the meaning will become very apparent in a moment or two.

The enquiries I receive

Sometimes the most interesting outcomes come from the business enquiries that aren't really business enquiries. This post came about because I received an enquiry from someone asking me to look a their website. I get a lot of these requests - some genuine, some competitor intelligence, and some where a site owner is not 100% that their current SEO provider is applying best practice techniques. In the latter case, site owners most often are looking for third party validation of their current SEO strategy to sooth any fears they have. More about this in a second.
Specialisation is good… most of the time

My academic background comes from the economics discipline. Economic theory generally recommends that specialisation is a good thing. Indeed, I would say that SEO is quite a specialised area. But what about SEO companies that focus in the main part on just one particular niche? Does this create more problems than it solves?

The case of the [city] widget

The following case came about from email communication with someone who contacted me to check their site. It quickly became apparent that their enquiry fell into the third category I mentioned above - validating a current SEO campaign/strategy.

In order to maintain confidence I wont be naming names, and I'm only going to say that consumption of the product or service offered by the enquirer is geographically dependant. There is a large number of suppliers of what I'm going to refer to as "[city] widgets", and the niche is highly competitive. Very often ‘[city1] widget' is not a substitue for ‘[city2] widget', although some substitution may occur where the user is location elastic.

The specialised SEO company

After looking over the website in question I found, what in my opinion, could be very dangerous utilisation of a particular technique (I'll be writing about that shortly). So I made my opinion known to the enquirer and asked them to contact their SEO provider and seek some further clarification.

Follow-up correspondence contained some interesting information from the SEO about the technique used and why it was ‘perfectly safe', but, more relevant to this post, why the SEO provider was initially chosen by the enquirer to promote their site.

It turns out that the SEO company is question are very much a ‘Sectoral-based' SEO provider. That is, they are very active in one particular niche.

Why would you choose one SEO provider to promote your ‘[city] widget' over another?

It's more than common to use track record when selecting a supplier for a good or service. Proven track record is often a very good indication of future performance. In this particular case track record was indeed a strong criterion. I paraphrase:

seen as they represent our three main competitors, and those competitor sites all rank on page #1 for "[city] widget", our site should do so also by the end of the year

For me that opens a real can of worms.

Is it ethical to represent competing sites?

In this case it appears that the SEO company in question represents lot of sites selling [city] widgets. They also happen to market software that enables the purchase of ‘[city] widgets' which I'm sure is a very strong supporting factor. And, in fairness, the competitor sites mentioned do rank well for ‘ widgets [city]' (the order there represents the more likely search query).

So what's the big issue? Well, in cases where [city] is different there really is no conflict. But in the case of representing multiple sites from the same [city], can one SEO company ethically represent multiple direct competitors? I'm sure arguments can be made for and against, but I take issue with one provider promoting multiple competing sites. Why?

Well there are only 10 spots available on page #1 of the SERPs. And we know very well that the real action is in the top 3 spots. So how does a provider representing 4 websites all targeting that same honey-pot phrase "widgets [city]" do so ethically? A number of questions arise:

1. Are all clients aware that their SEO provider is also promoting their direct competition? Are NDA's involved?

2. Will each client site be promoted equally? If so, how?

3. Is the SEO company being paid a performance-related bonus/retainer? If so, is it similar for each client site? If so, could the provider profit by rotating resources to make each site rank highest for a short period of time?

4. Is the same internal individual responsible for actually working on each of the competing client sites? If so is data from any of the client sites being used in the promotion of competing sites?

5. If the SEO company has multiple employees, and client sites are assigned to different team members/teams what steps are taken to ‘wall' information?

6. Most importantly for me, are client expectations being properly set? Is each client aware of how much traffic each position in the SERPs will receive? Are newer clients of the competing group aware that they may never attain number #1 position as older clients may have an ageing benefit both on- and off-site?

Those are just a few questions that come to my mind when a single SEO provider is promoting multiple competing websites. I'm not saying that promoting multiple competitors has to be unethical, but I do have the view that doing so opens up a whole new set of issues that make it wholly more likely to end up being unethical.

The can of worms gets even ‘wormier'

So I've stated my view that providing SEO for competing websites can be unethical. But there is another dimension to this can of worms that really grinds my gears - PPC. Let's imagine that the SEO provider is a full service SEM company.

What happens when, as with many websites in this niche, PPC is used to promote the sites in question? And now consider what if the same provider of SEO also manages the PPC campaigns for the competing sites?

PPC is a very different beast in general to SEO. For a start PPC usually is managed under a % fee structure - the management firm usually gets a % of the total spend.

Now I'm no PPC expert, but I do know that PPC uses a modified auction system. Bidders can set their maximum bid, and all other things being equal, the highest bidder has their ad display above all others.

Let's pause for a second and add back into the mix the fact that PPC management companies generally receive a % payment based on total spend. Now suppose that the same company is managing 4 separate accounts, all targeting a similar set of keywords, and all demanding results.

Personally I would be more than a little anxious that it might be very easy to manipulate the spend of all 4 accounts for reasons not entirely in the clients best interests.

We're sorry, but the maximum bid keeps increasing…

For instance, it could become advantageous to have clients bidding directly against each other in a bidding match where there is only one winner - the management company (although the PPC engine wont ever be on the losing side either).

I can picture explanations being sent to clients explaining that the maximum bid is increasing incrementally, and that in order to attain better results a higher spend is required.

Higher spend = higher management fee.

I think you can quickly see that conflicts of interest could become all the more problematic.

Am I generalising?

The above of course is simply my own opinion. Again, I must state that the above case doesn't necessarily mean that the SEM company in question is acting unethically. But in my view when one company promotes multiple competing sites there is an over-riding need for clients to have oversight which requires knowledge of the ‘bigger picture', and for the provider to be absolutely transparent in order to maintain ethical standards.

Just my view. What do you think?

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About the Author:
Richard Hearne is the founder of Red Cardinal, a dedicated search marketing consultancy. A frequent contributor to Google's Webmaster Group, Richard regularly advises clients on Internet marketing strategy and Search Engine optimisation campaigns. Richard's thoughts and research can be found on his search marketing blog.