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Today at BIA/Kelsey’s ILM East conference, Christine Merritt, Google’s head of business development of channel sales, revealed the inner workings of the AdWords local reseller program.

This follows closely behind lots of industry consternation, given some of Google’s shifting moves with policies around its resellers. Given its market share of paid search, any moves affecting the local resellers of AdWords is felt deeply — for better or worse.

Its now set up with “thousands” of certified resellers for AdWords, a key way for Google to tap into the long tail of SMBs interested in paid search. It also has a higher-level Premier Reseller program, which comes with more Google one-on-one support and other premium services.

In both cases, Google has tightened up its requirements of transparency, after many resellers in the past have abused the system — and naive SMBs — with hefty markups. That not only leads to high churn, an already challenging problem local SEM, but these practices also make Google look bad.

Think of it in the same way that bands are against ticket scalping. So having been burned by such practices, Google has shifted its terms and policies about whom it works with. This has been galvinized further under the current administration, led by Merritt’s boss, Todd Rowe.

So what are the ideal local AdWords reseller partners Google looks for? Merritt points to large sales forces, complimentary (and non-overlapping) product sets, companies with innovative ways to resell AdWords, and those that generally have a philosophical alignment with Google.

She named ReachLocal as a good example of a company that hits all these marks for reselling paid search. In terms of mobile, she named Steve Espinosa’s new outfit AppStack as a great company for getting SMBs up and running with mobile websites, and also bolting on mobile SEM and SEO services.

Going forward she mentioned the possibility of different tiers of the program to optimize various reseller sizes, spend levels and needs (think “Silver” “Gold” “Platinum”, etc.). She admits this could repurpose principles of the acclaimed reseller program employed at her and Rowe’s former employer SAP.

“We’re talking about tiering,” she said. “How do we best serve the companies that want to partner? We have resource constraints like everyone else, so we want to make sure we’re mapping to different sizes of businesses.”

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