It seems to be the hip choice to spend money on SEO right now. The forums are full of people claiming; don’t spend money on Google Adwords, it is expensive and short sighted. In some instances, this is true, however it does not tell the full story.

Why does PPC advertising work?

The bottom line is Google Adwords works extremely well in some markets. First of all you have to realize that spending money on PPC advertising is a strategic choice. The strategy could be long or short term, however you do need to look at it in a targeted and outcome based way. You can’t spend money on PPC advertising in an aimless manner. Second of all Google Adwords has to be one of the most ubiquitous advertising method on the planet right now. More people interact with Google on a daily basis than watch the Super Bowl. You can reach any niche, any target in a cost effective way not imaginable 10 years ago.

What is the problem with Google Adwords?

However in recent years Google Adwords has become  too good for its own boots. We regularly document changes in the pricing of Google Adwords, and mostly they never go down. Over the last 6 months the cost of ALL adwords has increased, with some markets experiencing a 24% increase in the cost of advertising. Some keywords cost $50 plus per click, which is pretty much out of the reach of any small business marketing budget. This is compared to a far lower cost per click on something like Facebook. The other problem is that, because almost anyone can have a panel of Adwords  on their website, and because the best markets have become wary of advertising from Google, the quality of clicks from Adwords has also slowly decreased.

When does SEO work?

Building, and raising, an online profile takes time, effort and skill. SEO isn’t just about links, or just quality web content. It too can take time and money that might not see a return if done incorrectly. It is certainly more fickle than an Adwords campaign. However it is generally a far more profitable strategy for long term lead generation. In some markets, where there is little competition for certain keywords, one good link from an online directory can be enough to give a website a front page berth. In fact this would be the case with almost all local markets, and local keywords, where there are less than 10 competitors looking to make the front page.

In this scenario, the cost to the website owners might be a few hours in the beginning and then maybe one or two hours a month after that to maintain front page status. This is compared to $1 per click on Google adwords in a small market that, in a $150 campaign, will only generate a few leads for one month only, after which the owner has to start all over again. Even if you look at spending money on Facebook ppc advertising, you might get some response from 50c per click, but again it is short term and may generate some followers on your Facebook page, but that is about it.

To use a real life case study, in one month one company received over 5k visitors from search engines, 2.5k  came from his PPC advertising, which cost a total of $2,169.20 for the one month. The other 2.5k came from organic search at a cost of $533. What’s more, the traditional SEO visitors had a higher conversion rate than PPC visitors, at 2.3% vs.1.4% respectively.

When is a Google Adwords campaign a good idea?

Spending money on Adwords can be a very effecting marketing strategy in the following scenarios;

The strategic campaign

Got a short term offer, or event, that might last for one day or two weeks? Adwords is a great idea for this. If you are promoting an event, or something that is only going to exist for a short term, ppc in any form is one of the most cost effective online advertising methods. Adwords or even social media advertising allows you to target a diverse range of people, even in just one local area. SEO for this scenario would take a long time to build, for something that exists for only a short period of time.

Where SEO is expensive

Effective, long term SEO can be expensive in highly competitive global markets. International insurance companies are a good example. The leading Australian global insurance companies have exceptionally high PageRank and have tens of thousands of affiliates linking to them. If you were to launch a marketing campaign in this market, the $50 price tag per click would actually see cheap. If you found the right target, and could convert, almost any form of ppc would work better than attempting an SEO campaign

Where you are branching out into new markets

If you are an established player in one market, and you are looking to move into a new area, Adwords, or some other ppc campaign,  might be your best and only option for an online marketing campaign. When a website builds an online profile, the search engines will give the website a ranking for a particular keyword. Once that keyword profile has been established, it is very hard to shake. So if you have rated well for “Sydney Marketing” if you suddenly want to add “Brisbane Marketing” onto your keyword profile, you are not only looking at starting again, you are also looking at having to work against the “Sydney” keyword profile you have already got.

We will go into the major Adwords markets later this year, but for now, you can see, Adwords are great in the right place.