SEO vs SEM: What’s the Difference?

User SearchSo, you have a business, old or new, and need to be found online.  And you have a number of different people in your ear telling you to spend money here or there.  “We can guarantee you’ll be found,” they tell you. “I can drive more traffic than the next person,” says another expert.

All the while they’re throwing acronyms at you like they’re going out of style. “You need SEO,” says the expert. “It’s all about SEM,” claims another.

Now, where do you go from here?

Your next step is get a little education.  There is no shortage in the ways you can spend your money, but as a smart business owner, you know you shouldn’t spend that money if it’s not going to bring you something in return. That’s ROI, which is an acronym you’re probably familiar with in the traditional meaning – return on investment. Now it’s time for an ROI of a different sort – return on information.

We’ll start with SEO, which is search engine optimization. In short, it amounts to creating a presence (like your website) that meets the relevancy measures of the various search engines. Unless you’re in a tiny niche industry, your focus here is on the major engines (e.g. Google) and on providing content that is important to your target audience. The algorithms that the various engines use has changed over time, but using keywords in useful content that match what your audience has in mind is the place to start.

You’ll occasionally hear the term “organic search results,” which essentially refers to the results you see from a search engine that are returned based on how your keyword relevancy drives the usefulness of your site, at least from that search engine’s point of view. This is the natural set of results that are not driven by advertising or other explicit forms of placement.

Moving on, we turn to SEM, which is search engine marketing. SEM is a broad set of practices that you use to drive traffic to your online presence, and it includes SEO as one of those options, along with the following options:

  • Online ads – This area primarily includes online banners displayed on a results page (search engine results pages – SERPs) when your paid ad meets the search criteria entered by your audience. You’ll normally pay for each impression, which is each time your ad is displayed.
  • Pay-per-click (PPC) – Similar to the process above, the difference here is that you only pay for those visitors that actually click on your ad rather than views or impressions.
  • Paid inclusion – The primary difference of this over SEO, is that you are paying to have your site included earlier in the process and potentially higher in the rankings, rather than waiting for the engine to find you naturally through the normal course of crawling the Internet.
Overall, which method you choose will depend on your budget and the results you want to achieve. To help in that selection, you’ll need to ask a few questions of anyone you work with.
  • What is the cost to acquire each new potential customer? If the cost to acquire a new customer exceeds the money you’ll make on each one you gain that’s a losing proposition, no matter how many new customers you capture.
  • How targeted can my efforts be? Although it may vary for your industry, you’re best return will normally come from focusing your efforts on a core of customers that are most likely to buy from you. It’s better to attract the attention of 100 potential customers that are at least 50% likely to buy, than attracting 1000 that only buy at a 10% rate.
  • How flexible is my marketing approach? Going in, you’ll need to remember that your approach is going to change over time as you learn what works and what doesn’t. Online activity is dynamic, as is the actions of your competition.  If you’re too locked into an approach you’ll eventually lose out.

While I’m only scratching the surface here, this should be a great start. There’s nothing wrong with using the experts to help you achieve your goals. After all, that’s really the smart way to go, since you probably won’t have time to do everything yourself. After all, you have a business to run. And now you are armed with information that will help you start to ask questions and get the returns you need.

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