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Comparing SEO and SEM: Which is the Right Investment?

Marketers and agencies often pit SEO and SEM (or PPC) against one another, claiming one is better or more valuable. At Clarity Quest, we believe in the power of both. SEO and SEM have been some of the lowest cost-per-lead sources for our agency and our clients. In fact, choosing both can work to your benefit. Companies that own both a paid and organic listing on the same Google search results page experience almost 10 times higher click through rates (according to SEER Interactive).

If you need clarification on the features and benefits of SEO compared to SEM, this chart compares the two apples to apples in several categories. See below for more detailed explanations of each category.

Table Comparing SEO and SEM (PPC)

 

Features

A typical search engine results page (SERP) lists 10 organic results, each containing a blue webpage title, a green URL, and a description of the webpage. Some SERPs may also display links to relevant news stories, images, scholarly publications, local business listings, maps, and the Google Knowledge Graph, which gives detailed information directly in the search results. The number of organic results served depends on the search query.

Advertisers using Google’s SEM platform, AdWords, can choose to display one ad headline (up to 25 characters), two lines of body copy (35 characters each), and a landing page URL. AdWords offers additional Ad Extensions to improve the functionality of paid ads, such as a phone number, address, reviews, and more links to relevant web pages. The Google Display Network allows advertisers to serve image and video ads to Google’s partner websites based on several targeting criteria including keywords, placements, topics, interests, remarketing lists, and demographics.

Traffic Potential

The beauty of SEO is that you can rank in the organic search results for an unlimited number of long-tail search terms. 15-20% of daily Google searches have never been searched before. With 3.5 billion Google searches completed every day, that’s in the neighborhood of 600-700 million new, unique searches per day. Intelligent keyword research, proper website optimization, and strategic content creation can position your site as a match to the search intent of a huge number of search queries.

Traffic from paid search, on the other hand, is limited by your budget, among other factors. Across the AdWords accounts we manage (Search Network only for this example), our clients pay an average of $3.65 per click to serve ads in the number one position for highly competitive search terms. If your SEM budget is $2,500/month, for example, that’s about 700 clicks per month.

You won’t be able to get more traffic from paid search unless you a) give it more budget or b) further optimize your campaigns. Cost-per-click depends on the competitiveness of your keywords, your account structure, the quality of your ads and landing pages, and the position in which you want your ad to serve on the SERPs. Even with further optimization, you can only lower your cost-per-click to a certain extent given the competition in your market.

Keyword Opportunities

Again, your opportunities for ranking organically for a particular search query are potentially unlimited. The only factors limiting your ability to rank for long-tail searches are the overall quality of your website and the depth of your content. While defining specific keyword targets and optimizing content to rank for those terms used to be the goal, Google’s sophisticated algorithms now recognize the overall subject matter of your content and reward for relevancy. Instead of optimizing for a limited set of keywords, focus on becoming a subject matter expert and creating high-quality, useful content.

With SEM, you can choose to advertise for any keywords you want, but will again be limited by budget. It’s best to select a few well-targeted topics and keywords for which your prospective customers will be searching. Within the AdWords Search Network, there are four keyword match types that allow you to be selective in your targeting strategy based on the relevance of the search query to your keyword.

  • Exact Match – Show your ads when the search query matches your keyword exactly.
  • Phrase Match – Show your ads when the search query is a close variant to your keyword.
  • Broad Match – Show your ads when the search query is a relevant variation or synonym of your keyword.
  • Modified Broad Match – Identify a term that must be included in the search for your ad to show. 

Cost

You cannot have success in SEO without commitment. Successful SEO requires keyword analysis, website optimization (and sometimes a website overhaul), and dedicated, consistent content creation and link building efforts. You will need a dedicated internal resource or outsource marketing department to focus on all facets of SEO, continually monitor rankings and traffic, and stay up to date on the latest search algorithm changes and trends. It requires an experienced resource and financial commitment to initial work and ongoing improvements.

Likewise, SEM campaigns require a dedicated budget. Some companies will spend $1,000 on an AdWords campaign over the first two weeks, then quit due to lack of conversions. This is misguided and shortsighted. A successful SEM campaign requires an investment of time and money. Give your marketing agency or internal department a few months at a minimum to optimize your account and get it running efficiently.

Expect to spend at least $2,500 per month in ad spend fees at a minimum. Commit to the campaign, then evaluate after an appropriate amount of time. Don’t quit too early, or you could be dismissing a valuable channel. Depending on the size of your account, the monthly maintenance costs of an SEM campaign can be lower than SEO management. Anticipate campaign setup fees between 30% and 60% of your monthly ad spend for quality SEM management services if your ad spend budget is below $10,000 per month. For monthly ad spend budgets above $10,000 per month, service fees will scale down as a percentage of spend as there are economies of scale in campaign management. Again, monthly management must be done to ensure SEM success.

Goals

Many online marketers focus solely on organic rankings to judge the success of an SEO program. While higher organic rankings certainly increase your traffic potential, you should focus more on the overall website traffic earned from organic search. If you have high rankings but organic traffic is falling, that’s a sign you are focusing on the wrong keyword set. As long as you create exceptional, valuable, high-quality content to match the many intentions of searchers through every step of your sales funnel, the rankings and traffic will follow.

The goals of an SEM campaign differ slightly depending on the network you’re targeting. For the Search Network, the goal is very similar to your SEO goal. You want to match the intent of the searcher, serve compelling ad copy and offers that entice the searcher to click, and drive visitors to targeted landing pages that contain the content they need. While you can also drive website traffic and conversions through the Display Network, your display ads are more often going to help increase brand awareness and visibility. Strategic remarketing campaigns can also re-engage visitors who have been to your site but failed to convert, helping your company stay top of mind.

Time-to-Value

Depending on the level of competition and your dedication to SEO and content creation, it could take 6-12 months or longer to crack the top page of the organic search results. We often say SEO is a marathon, not a sprint. Once you achieve top rankings, however, it’s easier to hold on to your position and reap the long-term benefits of SEO.

SEM, on the other hand, can bring in leads and drive conversions right away. Following intelligent keyword research and account setup, your ads can get in front of targeted searchers on day one.

Still not sure where to invest your online marketing dollars?

We are happy to guide you in the right direction. Give our healthcare and tech marketing experts a call to discuss your campaigns today at 877-887-7611, or request a quote online.

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About the Author:

Brian Shilling
Brian is a Branding & Digital Marketing Director with experience leading diverse teams of marketers and designers in strategic marketing, content creation, and crafting comprehensive messaging and positioning platforms for our healthcare and tech clients. To learn more about Brian's experiences and qualifications, visit our Meet Our Executive Team page.

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