I don’t know Zunch, but I’d argue that it’s generally good riddance when overpriced fancy SEM firms go belly up. As Google creates easier, better, and cheaper ways to do great in-house SEM (e.g. Analytics and PPC management) it’s not surprising places are opting for this approach. For the most part the big SEM firms are dramatically overselling types of SEO that cannot be done at all or are best done in-house or with the greater expertise found in small SEM shops and freelancers. My $9600 bad experience with a fancy SEM firm last year led to a refund, but that was thanks to threatening to blog about it and the written guarantee of increased traffic. I think very few get refunds despite generally poor performance.
After a clever and intense process of selling me on the service it was frustrating to watch them apply generally good but obvious principles of SEO. Also frustrating to note that I knew more about SEO than they did from attending a few Webmaster World Conferences.
So, is Zunch the beginning of a new trend? Perhaps a good trend.
Joe Duck 
Overpriced and fancy and in a field wherein there is considerable fraud. Quality seems to count only when the con men begin to run out of ignorant marks.
Reminds me of the salesman peddling these two-thousand dollar commodity options: when he encountered a potential client who asked him ‘why can’t I just buy a thirty-five dollar option from a reputable firm’ the salesmen just hit the disconnect button and called the next potential victim.
It would be interesting to try to measure the “legal but scammy” economy, which is extremely large – I’d guess 10% or more of the total economy. Whereever you have high pressure sales, and often where you have the type of scammy but legal things you are talking about, you have companies taking advantage of confusion and ignorance to sell things at inflated prices. The inflation is often equal to the cost of the high pressure sales effort. In multi level marketing this is often the case – you pay $10 for the vitamins you could get at Wal-Mart for $5. The extra goes to fund people in the pyramid.
The problem is it’s hard to scale proper SEO, without cookie cutting it. Hence the problem.
The bigger they are, the more people they have there, the harder it is to get their 40 people on staff up to par. Hence the bugger.
Once they get over X employees.. you start seeing crap happen that shouldn’t be happening.. or stuff that should of been done fall though the cracks.
This is why SEM can be scaled, but SEO you can’t. It’s why you have a few dozen good SEO’s out there and that is pretty much it.
Roger that’s a really interesting idea that SEM scales but SEO does not. I’d agree, but unfortunately a lot of medium sized and large internet projects still don’t get that, and count on weak SEO firms or people rather than biting the PPC bullet.
In fact a case can be made that good old fashioned SEO is almost dead because the search engines have put a lot of roadblocks in the way of getting sites to rank well. There are exceptions, but I sure would not want to take a new site and try to get it ranked well within a few months.
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