What to do when your Agency is Purchased by Scorpion
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September 13, 2024
GNGF Bought by Scorpion
Well – the rumors from 2 weeks ago turned true… last week, Scorpion purchased digital legal marketing agency, GNGF (or Get Noticed, Get Found for those of you in the game for a while.) There’s been online forum chatter amongst their clients as to what this means. I’ve talked with 4 different GNGF law firms and thought I’d share a summary of those thoughts here.
First, the Upside….
Scorpion has an absolutely massive data set to work with. Their AI technology, especially as it pertains to Google PPC is really world class. Combining the sheer volume of data and their AI expertise means Scorpion’s ability to optimize their overall PPC bidding system is unparalleled in the legal world. GNGF CEO, Mark Homer sited this in a recent podcast interview about his sale as a strong upside for GNGF’s clients. It’s also their rationale for Scorpion having a completely closed system – in which end clients don’t have access to their own Google Ads, Keywords, and the backend of their proprietary platform. That’s a tradeoff you have to be comfortable with in order to benefit from Scorpion’s AI prowess, massive data set and extremely efficient campaigns.
Additionally, Scorpion pioneered amazing website design and while the website design world has caught up, most of the Scorpion sites remain visually appealing (and presumably mathematically optimized for high conversion rates.)
UPDATED CONTENT: After this published, I did receive an email from a Practice Management expert with the following… (which attests to how a large spender can benefit from Scorpion’s closed box system):
I sent your Scorpion article to two lawyers recently. One is a small family law firm who is in the process of trying to leave Scorpion. He said the article confirmed his feelings and suspicions about Scorpion. The other lawyer, a small firm federal plaintiff employment lawyer, whose firm has “volume issues” said this:
I have been a client of Scorpion since 2016 or so and they have done well for me since day 1. They have literally made me millions of dollars.
But….
Scorpion Handcuffs
I really dislike the technical, analytical and contractual handcuffs employed by Scorpion:
Technical Handcuffs
Scorpion’s proprietary system means a)you can’t work on your own site b)you can’t transfer your own site to another vendor c)if Scorpion’s code base doesn’t support what you need, you are shit out of luck. To this date, I haven’t seen a multi-lingual site developed by Scorpion using hreflang tags, for example. If I were a GNGF client, whose site is currently built on the widely utilized WordPress platform, I’d have huge qualms about donning the technical handcuffs of a proprietary platform. (Note: I have NO insight into Scorpion’s intent to migrate GNGF clients onto their platform, but I don’t know how they could deploy the benefits of their closed system without doing so.).
Analytical Handcuffs
Want to see data from your own PPC campaigns? Sorry – it’s a closed door; you can’t get in.
Scorpion shall be under no obligation to disclose Paid Search Keywords to Clients
Relying on the reporting fox to guard your campaign henhouse is a very very bad idea. If I were a GNGF client – I’d be downloading all of my current keyword data and establishing business benchmarks that I control for Google Ads Campaigns. You literally don’t know what you are buying. One of the big problems with not being able to access the data in your own PPC campaigns is that you can’t disambiguate Branded vs. Non-Branded campaigns. And this is so foundationaly important because the economics are so fundamentally different. Put differently, if you can’t see into your own campaigns, an agency can deliver you low cost and high converting branded traffic (“Smith and Jones Law Firm“) under the premise that it is high cost, incremental business from expensive competitive keywords (“Motorcycle Accident Attorney Nashville“).
Further, separating branded vs non branded ad campaigns is getting increasingly important, as Google goes out of its way to conflate the two.
Contractual Handcuffs
I’ve never liked retaining a client on the sole basis of a contract and to be fair, I have seen shorter term Scorpion contracts than some big box providers (looking at you FindLaw). Ignoring the fact that the agreement has a one-way For Cause termination clause:
Scorpion may immediately terminate the Services if Scorpion has reason to believe that (i) Client is attempting to disparage or defame Scorpion; expose Scorpion to legal liability; or otherwise act in a manner reasonably likely to harm Scorpion’s business interest;
What i really object to in the contract is Scorpion’s ability to modify where and when the clients’ ads are actually targeted. While they enumerate specific zip codes in their contract, they also include the provision to modify these. And because the law firm doesn’t have access to the Campaigns, there’s NO way to know where (or when) your ads are actually being served – which is a huge problem for a locally based business.
This can become a strategic nightmare: what if you don’t answer the phone at night? want to support a new office location? want divorce clients from a wealthy part of town? don’t want a specific type of accident? take a week’s vacation?
Account Person:Client Ratio
One of the upsides to running campaigns through all of this AI automation is that you don’t have to employ many people to do so. A Scorpion Account Executive told us she juggled 60+ accounts at a time – turning the AEs essentially into order takers and report readers. IMO there’s no deeper relationship, no consultation, no getting to know your business, no thinking outside the box, no strategery. To be fair, I believe at Scorpion’s very large accounts do get a VIP treatment with an Account Executive running fewer accounts; but do you really want to be one of sixty while the market’s 100 Pound Gorilla gets individualized attention?
SEO vs. PPC
I strongly believe that digital agencies should be playing the whole chess board. Go back 10 years and Scorpion was a solid player in the SEO game, but I wouldn’t count them in the top 10 today. That’s simply because SEO success is much less scaleable than automated, AI driven PPC campaigns. Now this is a fully subjective statement on my part and I’m sure someone can show me some counterpoints, but overall Scorpion has shifted heavily to paid management.
Speaking of SEO and GNGF I will say; we have fundamental disagreement on the strategic value of backlinks, as at Mockingbird we see them as foundational for a successful campaign and disagree with the notion that links aren’t that important (as described by GNGF here: Local without Linkbuilding). Given the difficulty and high cost of acquiring successful local links, I don’t believe a move to Scorpion is going to change the SEO game for GNGF clients. I could very well be wrong from an SEO perspective.
Market Exclusivity
You also have to believe their brilliant (and I don’t say that with sarcasm or derision) AI driven system is optimized for the primary benefit of their clients. I simply don’t believe that to be true for the fundamental reason that they have multiple competitors within a given market. There’s simply no way to be a great date when you take 7 people to the same prom. Given the zero sum game nature of PPC – someone is winning and someone is losing.
Business Model and Expense
Finally, there’s a matter of money. In the examples I’ve seen, Scorpion provides a subscription to website, infrastructure, and team and then charges a percentage of spend on top of that. It’s a great MBA plan, but I’m not sure it works for their end client. In the contract I’ve grabbed screenshots from – this was for a $25K spend with broken down thusly:
- $5,000 one time setup fee (which we will ignore for further analysis b/c the rest of this is monthly….)
- $5,200 to license the team and website. Now I’m not sure how you combine the website and the team (and I don’t think you can, b/c there’s already a 20% ad management fee the presumably goes to pay for… the team. This is a very very expensive website; over a 3 year period costing over $187K. I’d frankly rather buy a Ferrari 550 Maranello every three years instead.
- $1,575 to license the marketing suite
- $525 for call tracking and reporting (which is bluntly LESS than we charge; but I believe ours goes much much deeper with integrations into IMS software.)
- $100 for reputation monitoring
- $100 for hosting and maintenance
- $3,500 for roughly (their words not mine) 20% for ad management fee on the remaining money.
So that $25K monthly spend drops to an ad spend of just $14,000 with an effective ad management cost of 44%; which is bluntly exorbitant. So if you find yourself moving over…. calculate this number, the true ad spend management fee.
Moving Forward
I’m not encouraging you to break your contract with GNGF… but I think now is a very good time to ensure that you aren’t making some decisions with long term consequences that you may come to regret.
“Scorpion shall be under no obligation to disclose Paid Search Keywords to Clients” Is that from their contract? That should be a non-starter. No segmentation between brand and non-brand? To me, this doesn’t meet the minimum guidance from Google’s Advertiser guide: Working with third parties: “Not sharing the cost and performance of advertising campaigns. You have a right to know, at a minimum, the number of clicks, impressions, and cost of your Google ads.” While it doesn’t explicitly say keyword data, keywords are at the heart of cost and performance data. Are they buying media based on qualified consultations? Retained clients? Do the law firms have any say in how media is purchased or is pure black box? What if there are sites the law firm doesn’t want to advertise on? Do they have any control of where media is being purchased?
Like it or not, most clients aren’t buying marketing, quality or not. They’re buying leads. Or maybe they’re trying to buy revenue.
Since forever, companies like Scorpion have focused on scale over quality, and in many cases ethics.
Hopefully, the good clients will realize they’ve lost control of one of their most valuable assets and come looking for a help from a reputable law firm marketing agency, and give you a call 😀