Only 12 per cent of Australian firms used AI in 2024-25, according to the ABS report. Released in June 2026, this number has jumped dramatically from just 1 per cent in 2022-23. Automation of the advertising platforms has been significantly quicker, with automated bids and matches becoming a standard in most campaigns. Many Melbourne business owners raise a perfectly reasonable question in this case: if the campaign is controlled by Google AI, then why employ an SEM agency? The answer to this question lies within decisions that automation cannot make on its own.
Search Marketing Goes Farther Than One Platform
Search marketing is typically associated with paid search on search engines, mainly Google Ads in Australia. There is also Microsoft Advertising, which includes Bing as well as other placements. The audience is likely to be different in some industries, so a fair test should be performed within the real account for each platform. Additionally, Google adds advertisement placements to complement its AI search functions. However, the formats may differ in different markets. Brand search, competitor search and category search all require separate budgeting and separate goal setting. Different mixes of placements will be required for a plumber in Footscray and for a law firm at Collins Street. Finally, it is important for an SEM agency in Melbourne to combine paid and organic search marketing plans.
Automation Is Ahead of Most Businesses
There are no figures about advertising in the ABS report; however, there is an important comparison to be made here. While most businesses have barely begun using AI, the same cannot be said about their advertising accounts, which already use it quite extensively. The decisions related to Smart Bidding, broad match and AI Max for Search are already automated, and the decision-making may not be supervised by a human. According to Google, the AI Max increases conversion rate for advertisers who use it by 27 per cent. These numbers are provided by the company that sells advertising itself, so independent testing is required. Moreover, the automation optimises towards the set goal regardless of whether this goal is correct or not. The poorly defined goal will not fail loudly; it will just waste money for a long time.
Where Human Judgement Still Wins the Day
Good SEM agencies earn their fee by making the tough calls the platforms can’t, calls like:
- Conversion Inputs: Sending leads that actually convert, and not just every Tom, Dick and Harry who filled in a form.
- Search Exclusions: Keeping irrelevant searches at bay and making sure your brand terms are properly looked after.
- Getting Ads and Pages Aligned: Writing copy and pages that actually match what you’re selling, where you’re servicing and what you’re good at.
- Learning vs Throwing Money Down the Drain: Being able to tell the difference between a campaign that’s still learning and one that’s just burning cash.
- Local Context: Making sure your campaign is targeted to the right areas; in our case, real Melbourne service areas, travel limits and business hours.
Take a Melbourne electrician, for example. They’re advertising right across Melbourne without any service limits. Guess what? They’re getting calls from suburbs they’ve never even set foot in. And the platform just counts those as a success. But a human being reviewing those search terms and call records can spot the mismatch pretty quickly and tighten up the targeting. Tracking quality is just as important these days, especially with the privacy regulators keeping an eye on how you collect personal info. Clean, lawfully gathered data is what automated bidding needs to learn from in the first place.
Judging a Melbourne SEM Agency in the First 3 Months
Ninety days isn’t usually enough time to see the final results, but it does give you a pretty good idea how the agency thinks, communicates and spends their time. Your sales cycles, budgets and conversion volumes all affect how quickly you can get a handle on things. The account should always be owned by your business, with the agency just having access and not the keys. A straight-up opening audit should name the wasted spend and not just list a bunch of untapped opportunities. Reports should be linking results to cost per lead or sale and giving you feedback from the sales team on lead quality. And testing plans should have clear goals and timelines, because campaigns left to their own devices tend to just drift along.
And then there’s the fee structure; it’s worth taking a close look at that too. Because percentage-of-spend models can quietly reward spending more and more.
An agency that recommends chopping a weak campaign, even when it means they take a haircut on their fee, is usually an agency you want to stick with. The machines can certainly bid faster than we can, but they still can’t tell whether a lead is any good or not.
