You’re on a budget. Which should you invest in SEO or PPC?

When people are looking for a product or service, the first place they look is Google.

So naturally, when they search, you want your company to be the one they find first.

 

Search engine marketing is an incredibly important part of any digital marketing strategy. For many companies, it’s actually the most important, because it brings the highest return on investment.

There are two ways to get seen in a Google search: SEO and PPC. They may seem similar at first glance, but they’re actually two very different things.

SEO stands for search engine optimisation . This is the process of taking steps to maximize your website’s chances of appearing on the first page of Google’s organic search results for relevant keywords. This means making sure your content is the best it can be, that your page answers the user’s questions, and that you have backlinks from other websites to vouch for you.

PPC stands for pay-per-click advertising . You’ve probably noticed that unless you’re using an adblocker, there are search results labelled as advertisements at the top of most Google searches. The way that Google displays the ads has changed a few times over the years, but today, there are four of them at the top of the page, above the organic search results. Next to each paid search ad is a little green icon that says “Ad.”

Those results are PPC advertisements. The company pays based on how many people click on their link. The cost per click can vary drastically, depending on what keyword you’re targeting. It could be as low as a few pence, or as high as £30.

Both SEO and PPC can be very efficient when it comes to ROI, and for many brands, it makes the most sense to invest in both forms of search marketing. But in the real world, budgets aren’t always what we wish they could be, and sometimes, you do have to make choices about where to invest more.

Here’s an analogy I like to use when it comes to PPC vs SEO. Starting a PPC campaign is like turning on a tap that starts putting out water as soon as you turn the handle. Results start coming in almost immediately, but when you turn the tap off, the flow of water stops.

SEO, on the other hand, is like turning on a tap that takes a while to start flowing. For a while there, you wonder if the tap might be broken, and you’re not sure whether any water’s going to come out at all. But then, it starts flowing. And once it starts, when you turn the handle back to the off position, the water doesn’t stop right away. It will eventually, but it keeps flowing for quite some time afterward.

So should you pour more money into SEO, or should you take that money and put it into PPC instead? There isn’t one single, universal answer to this question. It can vary based on your industry. Some companies get the most out of PPC, while for others, SEO is absolutely essential. But, there are steps you can take to determine which strategy is best for your particular business.

SEO and Competition: Can You Rank Without Breaking the Bank?

SEO is a zero-sum game. There’s no way around this fact. For any given keyword, there are anywhere from dozens to hundreds of websites that are optimising for it. Of those, only ten can appear on the first page.

There’s a very strong element of competition at play, and that’s something you need to consider when you’re considering SEO as part of your marketing strategy.

Some keywords hardly have any competition at all, and ranking for them is practically a cakewalk. Have you ever Googled a question hoping for an answer, but all that you could find were ancient forum threads from 2005?

Whatever you typed in, there wasn’t much competition for it. No one was actively trying to optimize for that particular search query.

On the other hand, there are some keywords that are basically impossible to rank for unless you have millions of dollars to spend. The SERPs are dominated by big brands and authority sites, with thousands of backlinks, massive brand recognition, and astronomical budgets. For these kinds of keywords, it’s all but impossible for the “little guy” to compete.

Now, this doesn’t necessarily mean that SEO is worthless for you just because your company offers a project management SaaS, and the SERPs for “project management software” are pretty much impenetrable. This is where longtail keywords come in.

Longtail keywords are longer and more specific than “head” keywords. Here’s an example. “Project management software” is a head keyword. It’s fairly broad and general, and as you can imagine, it gets a lot of search traffic. It’s also very competitive, with the SERPs dominated by big brands and authority sites. For a fresh new startup with limited funds, it’s going to be an uphill battle.

“Best project management software for freelance developers” is a longtail keyword. It doesn’t get as many searches as “project management software,” but it’s easier to rank for. And people who search for it are looking for something pretty specific.

They’re probably in a buyer’s mindset, and may be ready to make a purchase decision sooner rather than later. That means that if you can rank for the longtail keyword, you’re in a prime position to convince them that your product is the right choice.

So as you can see, even if SEO looks prohibitive at first glance, it’s possible that once you start looking into longtail keywords, it has the potential to drive a lot of conversions for your business.

Investing in SEO Is a Long Term Game

SEO can be very profitable, but it’s not something that brings in sales overnight. It really does take time to start taking effect. You won’t see the benefits of a newly started SEO campaign within a week.

It can take up to six months to really start seeing results, and that’s something that a lot of people don’t realize at first. It’s a marathon, not a sprint. But when you win at SEO, you can win big.

SEO takes time because it’s complex and multifaceted. It’s not simply a matter of plugging in a few variables.

There are quite a few different aspects at play. Part of it is on-site optimisation. Part of this is having the right markup, so that Google knows what each page is about. Part of it is content development.

If your content doesn’t do a good job of answering the query, it probably won’t rank.

This applies not only to the copywriting on the main pages of your site, but also to any blog posts that you might have.

Blogging can have a positive effect on SEO , but it takes time. The posts need to be written, either by you or by a ghostwriter, and they need to be published regularly on an ongoing basis.

And then, there’s link building. This is incredibly important, although a bit elusive for non-experts.

The reason that Google was such a big deal when it came out in the late ‘90s was that they didn’t just look at what words were on a page to figure out which results to display.

Instead, they also looked at whether other sites were linking to any given website. To rank in Google, you need links from other relevant websites.

In the old days, you could rank with all kinds of irrelevant and spammy links from article directories, blog comments, and other low-value sources.

But today, standards are a lot higher. The best links are natural editorial links that you didn’t actually ask for, but that doesn’t mean that link building is dead. In 2017, it involves a lot of outreach and creativity.

The days of link wheels and link pyramids are far behind us now, and SEO is quite a bit more challenging than it was back in 2005.

All of this takes time. Building up a robust backlink profile with relevant, high authority links is an ongoing, long-term process. So is creating unique, relevant content. But once the pieces are in place, you’ll see long-term gains well into the future. This “slow burn” aspect of SEO stands in contrast to PPC, which can be a much faster process.

PPC Can Bring Fast, Measurable Results — But It Can Cost You

PPC is another matter. When you invest in paid search advertising, you really can see results quite soon after you begin your campaign. SEO is notoriously difficult to quantify precisely.

There are measurements that we can use, and metrics that we can show our clients, but it’s all a bit oblique. Plus, it can take months to start seeing results.

With PPC, it’s much easier to tie the money you spend to the sales that it brings. It’s much easier than SEO to track exactly how many leads or sales your ads are bringing in.

With PPC, you can track calls, click-throughs, and conversions quite accurately and precisely. A well-designed and well-managed PPC campaign can also drive traffic to your website very quickly.

But as with all things, there are still drawbacks. One of them is price. PPC can get quite expensive, depending on what industry you’re in. Some industries, notably legal services and auto insurance, are notoriously pricey per click.

Just as highly competitive organic SERPs can leave you priced out and unable to stand a chance, the astronomical cost of some PPC keywords could potentially price smaller players out of the market.

For some consumers, PPC ads may also seem more biased and less reliably trustworthy than the organic results below them. They’re clearly labelled as paid ads, as they should be, so people know that they’re advertisements and not organic search results. Depending on who your audience is, there may be a perception that the organic results “earned” their position, while ads are only there because the company was the highest bidder.

 

Plus, there are some demographics who are very likely to use adblocking browser plugins that make the PPC ads disappear completely from the page. In mid-2016, the use of adblockers was predicted to increase by nearly 35%

A widespread distrust of advertising in general is quite pervasive among some groups of people, particularly tech-savvy individuals in their 20s and 30s. It’s possible that your particular brand is marketing to people who are very ad-averse, and who just don’t respond well to that form of promotion. These people will either block the ads entirely, or skip over the four PPC ads and go straight down to the organic results instead.

On the other hand, there are some types of products and industries where PPC can be immensely successful. Wordstream, a US-based online advertising company, created an excellent infographic showing which industries spent the most on PPC in 2011 . That was quite some time ago by digital marketing standards, but not much has changed when it comes to who’s spending money on PPC.

As Wordstream noted in a related blog post, there are a few different types of clients who put the most money into PPC . As you can imagine, this is the case because in those industries, PPC works. The biggest PPC spenders fit into a few distinct categories:

 

  • Industries where each customer has a high lifetime value. Universities, American medical and dental practices (which are private, and very different from the UK healthcare system), and utility companies get a lot of recurring substantial income from each customer they acquire. When you attend a university, you’re generally there to stay until your degree is complete. And when was the last time you switched internet service providers?
  • High margin businesses. Sometimes it’s a matter of a lot of value at once from each customer, not recurring value over a long period of time. Legal practices, home appliance retailers, and cars all fit into this category.
  • Products that people primarily buy online. There are some things where it’s more convenient to walk into a Tesco and buy it on the spot, rather than to wait for shipping from an online retailer. But at the same time, there are other things that you’d be hard pressed to find at a local shop. Rare, obscure, or uncommon items are things people generally order online, and it’s a prime opportunity to bring in customers with PPC advertising.
  • Seasonal products. Florists and costume shops see spikes in sales at certain times of year. No one’s buying Halloween costumes in January, and more people buy flowers for Valentine’s Day than on a random day in June. For products that are seasonal, buying PPC advertising during at the right time of year can bring some serious returns.

 

 

Naturally, these are just some of the types of businesses that can benefit from investing a significant amount of their marketing budget into PPC. But as you can see, there are definitely some industries where it works unusually well.

When doesn’t PPC work? Well, if it costs more to acquire each customer than you’ll make from that customer over their lifetime, it’s not worth the money.

Like all forms of advertising and marketing, PPC should bring in significantly more profit than the amount that you spent on it. While in some cases, PPC campaigns fail because they’re poorly targeted or poorly managed, there are certainly some situations where the cost per click might not be worth it for your business.

PPC may also not be worthwhile if there isn’t any significant search volume for relevant keywords. There are some things that people might certainly want to buy, but they might not be searching for on Google or actively seeking out.

 

So Which Should I Invest In?

As you’ve seen, there’s a lot of variance in the effectiveness of both SEO and PPC. The type of business you’re running, the kind of product or service you’re selling, the cost of PPC or competitiveness of SEO, and the lifetime value of each customer, are all things that can affect the viability of both channels for your particular company.

There’s no easy answer to the question of SEO versus PPC, but with some careful analysis and a little experimentation, you can gain insights into whether one, both, or neither form of search marketing is worth the investment.

Not Sure Where to Invest?

Not quite sure whether SEO or PPC is a better investment for your business? I’d be happy to help. At Finetune Digital, we work with quite a few companies for which it makes sense to focus on SEO, on PPC, or even equally on both channels.

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