Read Mark Baartse, Consulting Director of First Rate’s comments on one of the most important things that you need to know about SEM in this recent .NETT article by Luke Telford.

Every small business wants to get more online exposure for their brand online. This is why SEO is such a competitive industry. Businesses are constantly vying for the number one spot in search listings, but what many don’t know is that there’s more than one way to get there.
A term that is often used interchangably with SEO is SEM, or search engine marketing. SEM is significantly different to SEO, and it’s important for anyone who is trying to improve their search rankings to understand how each of the services can benefit their business in different ways.
Every time someone uses a search engine, they encounter SEM. SEM results are the highlighted links that appear at the top, and in a column to the right of search results. Advertisers pay to appear in the results for specified keywords. When a searcher clicks on their link, the advertiser is charged a commission by the search engine.
Kate Conroy, product specialist for AdWords at Google Australia, explains that SEM is essentially a way for businesses to buy ads or sponsored links on search engines.
“It’s distinct to SEO, which stands for search engine optimisation, which is about making your website more search engine friendly, so that it shows up higher higher in the organic, or free search engine lists,” she explains.
One major benefit to SEM is that it can provide a very quick turnaround in search results.
“SEM can give you immediate results,” explains Mark Baartse, consulting director of First Rate. “[It allows you to] respond a lot faster to changing market conditions, and you can respond a lot better to changing campaigns.”
“One of the most important things about SEM is that it’s a very quick way to get a presence on a search engine,” says Google’s Conroy. “When you buy sponsored links, or ads, on a search engine, you can often be up and running in under an hour, so you can have your ads showing very quickly. Whereas for SEO, generally it’s a very long-term project, so you may have to spend months or even potentially years making changes to your website and waiting to see if that will improve your results in search engines.”
Another benefit of SEM is that it allows you to control the exact details of the message that the searcher sees.
“With SEO, you can’t always control the page that people are going to end up on. With SEM you can,” says Conroy. “If you have a good understanding of your site, and which pages are likely to lead to something that’s going to cause a profit for the business – like buying something or coming in to visit your store – then SEM is going to give you greater control over that. You can put them in a place on your site where they’re more likely to drive the business’s bottom line.”
“Probably the big advantage with the SEM side of things is the real ability to tailor your marketing message,” explains Craig Somerville, managing director of Reload Media. “If you’ve got a great offer like ‘free delivery’ or ‘overnight shipping’, or if you’ve got a price point on a particular product, then you can get that across to the potential customer as they’re searching for that product, and display it to them in those four lines.”
SEM also allows businesses to set up a very specific way of measuring its return on investment.
“It gets to the point where you can actually track how profitable every single keyword you’re running is,” explains Somerville. “You can also track things like which ad messages are working best. You might find out for instance that free delivery is working better than overnight shipping, or that free gift wrapping is a better offer,” he continues. “So you can actually use SEM as a really good way to A/B split test your marketing messages which can then help drive other marketing strategies as well.”
The practical application that sets SEM apart from SEO is that it allows businesses to target short-term goals like marketing campaigns and promotional offers. Whilst the benefits of it are much more direct and measurable than SEO, explains Google’s Conroy, it shouldn’t be viewed as a replacement.
“We recommend for all businesses, if they’ve got the time and the budget, that they should be looking at both SEM and SEO,” she suggests.
One reason for this is that the cumulative effect of having the top ranking position in both paid and organic search generates more traffic than either would separately. “Let’s say that somebody types in a keyword for Katoomba Accommodation, and your business is actually showing on both the free listings and the paid listings, the clickthrough rate on both will go up, so it’s greater than the sum of its parts, just because you own more real estate on the page,” explains Conroy.
One criticism of using paid search is that most searchers just ignore the sponsored results, automatically blanking them out in favour of the ostensibly more relevant organic listings. Despite this, Conroy insists that the paid links do generate quite a lot of traffic, although the amount depends considerably on the nature of the searcher’s query.
“Say for example someone puts in a query like ‘history of the roman empire’. In that case we wouldn’t expect that many clicks on ads, as it’s not really something that’s commercial in nature,” she explains. “But if we have someone type in ‘car insurance’, then we would actually expect a significant portion of the traffic to go to ads, because people are looking for somethingsthat’s commercial, and the ads are meeting that commercial need, often in a way that the natural search results are not, because they’ll say things like ‘Get a 10 per cent discount if you buy car insurance online’ or something like that.”
Conroy reports that in her personal experience she’s seen clickthrough rates from anywhere between 1-2 per cent up to 50-60 per cent, especially for listings that target brand terms.
On the other hand, Reload’s Somerville has a more specific idea on the exact proportions between SEO and SEM clickthroughs.
“The average split is about 70 per cent SEO and about 30 per cent SEM,” he estimates. “But it depends on the search term. What we’ve found and what a lot of the other articles that have come out have shown is that SEM tends to be used by a more purchase-ready customer.”
Someone who’s at the information-gathering stage of the purchase cycle will probably favour organic listings over the paid results, elaborates Somerville.
“When the person actually gets ready to purchase stage, they’ll get to the point where they type in the exact make or model of the camera that they actually want,” explains Somerville, “and that’s where you’ve got to hit them with the targeted ad saying ‘this is the model you’re looking for, this is the price point, and a great offer like free delivery or guaranteed next day, or whatever it might be; that’s where we often see really good conversion rates on SEM, and that’s where the percentage of people clicking on paid ads actually goes up.”
Given this, many small business owners would no doubt like to know how many searches are commercial, rather than informational, in nature. Google’s Conroy explains that her company is also curious about this information, but has been unable to ascertain the exact figure itself.
“It’s a really tricky thing to do, because you need to discern a user’s intent from a query and often you get queries that could go either way,” explains Conroy. “If somebody’s searching for ‘Lamborghini’, for example, does that mean they want to buy one, or does that that mean they’re just a fan, and they want to read a fan site about other people who have this specific car. We’ve actually had people try and look at it, and we’ve found it hard to discern ourselves.”
See  the .NETT article here

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