The web’s a crowded marketplace, isn’t it? Every day, folks are out there bashing in more than 7 billion search. Every. Single. Day – looking for something specific. That’s a goldmine for businesses to reach potential customers, but how do you grab their attention? There are two main ways: SEO and PPC.
Both SEO and PPC require financial investment, and the question then becomes: SEO vs. PPC: Which method gets you more bang for your buck?
We’ll be dissecting both PPC and SEO, warts and all, to see which one reigns supreme. Then, we’ll explore how these strategies can be effectively combined for maximum impact. Finally, we’ll get into budget allocation between SEO and PPC based on measurable data.
What is PPC and SEO?
PPC and SEO are two critical components that can significantly improve your online presence. But what exactly are PPC and SEO? How do they work, and most notably, how can you use both to optimise your marketing efforts?
What is SEO?
SEO, abbreviating Search Engine Optimisation, encompasses a set of best practices designed to increase website traffic and improve the quality of that traffic. Many associate SEO with long-form content and blog posts; but content creation is only part of it. In fact, an effective SEO strategy is much, much more comprehensive than that. It involves strategic link building, technical optimisations, enhanced user experience, and more.
SEO strategies have evolved over the years, adapting to the changing priorities of search engines. However, one core principle never does: sharing helpful, authoritative content on your website and making it easily accessible to both people and search engines can propel your site to the top of SERPs.
What is PPC?
Short for Pay-Per-Click, PPC advertising is a dominant method of internet marketing used to drive targeted traffic towards a specific landing page. It’s got quite an array of advertising formats, including banner ads, as well as the sponsored product listings prevalent on marketplaces like Amazon.
Traditionally, PPC functioned through a straightforward model, where advertisers were charged for every click their ad received. However, the scope of PPC has broadened over time to now include campaigns that charge by the view (like YouTube ads) and campaigns with dynamic pricing structures aimed at achieving specific performance goals (Google’s target ROAS campaigns).
SEO: Pros and Cons
Pros | Cons |
Increases brand awareness and recognition | Takes several months to see significant progress |
Fosters trust and credibility | Requires substantial resources |
Very cost effective with high ROI | Ranking for top terms can be brutal |
Yields compounding results that last a long time | No guarantees, just a strong maybe |
Provides a major competitive edge |
SEO presents a wealth of benefits for businesses. When implemented correctly, it significantly enhances brand awareness, fostering trust and credibility. A robust SEO strategy allows you to capture impressions for highly relevant terms, which might otherwise be prohibitively expensive to target through PPC advertising.
That said, SEO does come with its set of challenges. As I’ve listed in the table, its effectiveness is not immediate—it may take up to six months to witness substantial results – maybe even more. However, the results of SEO tend to compound over time and therefore offer progressively better ROI as your efforts persist.
What’s more, budgeting for SEO can be more complex compared to PPC campaigns, as SEO costs are often less clear. Optimising for organic search is resource-intensive, particularly if your strategy involves creating a substantial amount of content or undertaking significant website updates.
Lastly, although a well-crafted SEO strategy provides your business with a serious, long-standing competitive edge, achieving high rankings for key industry terms can be challenging. It demands a considerable investment of time, energy, and strategic planning to secure top positions for keywords with high monthly search volumes (MSV).
PPC: Pros and Cons
Pros | Cons |
Attracts instant traffic | High cost, High ROI |
Laser-focused targeting | You’re likely to run into window shoppers |
Provides total campaign control | You might choose the keywords |
Highly measurable results | Requires constant tweaking |
Engage in bidding wars | |
People are adopting to ad-blocking extensions (me included, probably you too) |
Effective PPC campaigns also increase brand awareness and drive traffic to your site, albeit with a typically higher cost-per-click.
PPC offers rapid traffic growth. Unlike SEO campaigns, results appear in days, sometimes even hours. Choose keywords, set budget, and watch traffic surge.
With PPC, you can retarget site visitors more directly than SEO. Testing new messaging is simple and user-friendly, as most platforms provide transparent analytics for campaign performance.
However, PPC downsides exist, too.
The ongoing expense is the most significant challenge: PPC campaigns demand an ongoing budget, which can be prohibitively costly depending on the industry. The cost per click is also rising across various sectors. An immediate stop of your PPC spend results in a sudden drop in paid search traffic!
Although targeting target keywords is simple, your competitors have the same capability and can easily access which terms you’re targeting. Audience targeting is simplified, yet audiences are becoming ad-savvy and are often more sceptic about the ads they see.
Moreover, with over 763 million devices employing ad blockers, relying solely on PPC could mean missing out on a substantial and growing segment of potential customers.
Lastly, PPC campaigns are increasingly leaning towards automation and a “black box” format, diminishing the historical advantages of clear data and testing capabilities.
Given the many pros and cons on both sides, determining the optimal strategy for boosting conversions requires careful consideration.
Let’s look at the data to properly address the SEO vs. PPC question.
SEO vs. PPC: Which is Better for Conversion?
Conversion rates (the percentage of visitors to a website who take an action (e.g., making a purchase or subscribing to a service) can vary significantly depending on the specific industry and chosen marketing channel.
When analysing major industries overall, SEO tends to outperform PPC advertising in achieving conversions. In some cases, the difference in conversion rates between SEO and PPC can be substantial. However, in some industry outliers, PPC might demonstrate a higher conversion rate.
To help you make an informed decision, I’ve put together a table presenting average conversion rates for SEO and PPC across various industries. Please check the table for industry-specific conversion rate benchmarks.
Average Conversion SEO for PPC and SEO by Industry
Industry | Organic Search (SEO) | Paid Search (PPC) |
Travel | 8.5% | 8.5% |
B2C ecommerce | 3.3% | 1.2% |
Professional Services | 12.3% | 7.0% |
Automotive | 2.5% | 1.3% |
B2B ecommerce | 4.0% | 1.8% |
B2B Services | 7.0% | 5.0% |
B2B Tech | 1.0% | 2.5% |
Industrial | 8.5% | 4.7% |
Agency | 2.3% | 6.6% |
Financial | 4.7% | 6.0% |
Legal | 4.3% | 1.8% |
Real Estate | 3.2% | 1.5% |
Cosmetics & Dental | 3.5% | 1.9% |
Healthcare | 5.6% | 5.1% |
Data Source: Ruler Analytics, 2021
In the B2B e-commerce sector, organic searches boast a conversion rate nearly three times higher than their PPC counterparts, at 4% compared to 1.8%. This trend holds true for B2C e-commerce as well, where organic search conversions reach 3.3% versus PPC’s 1.2%. In the legal industry, PPC campaigns are among the most expensive, often costing tens or even hundreds of dollars per click. Despite this, SEO achieves a significantly higher conversion rate of 4.3% compared to PPC’s 1.8%. Only in a few verticals, such as Financial Services and B2B Technology, do PPC campaigns surpass organic search in conversion rates.
5 Benefits With The Larges Conversion Rate Gaps: SEO Vs. PPC
- B2C Ecommerce: In the B2C ecommerce industry, SEO demonstrates a conversion rate that’s 2.8 times greater than PPC.
- Legal Services: SEO outperforms PPC in the legal services sector as well, converting customers at a rate 2.4 times higher than PPC.
- B2B Ecommerce: Within the B2B ecommerce landscape, SEO converts customers at a rate 2.2 times higher than PPC.
- Real Estate: The real estate industry exhibits a similar trend, with SEO converting customers at a rate 2.1 times greater than PPC.
- Cosmetic & Dental, Industrial, and Professional Services: A conversion rate disparity of 1.8 exists between SEO and PPC in the combined category of cosmetic and dental services, industry services, and professional services. In this category, SEO converts customers at a rate 1.8 times higher than PPC.
Understanding the Gap
One significant factor contributing to this gap is credibility.
Google prioritises content that is trustworthy, authoritative, and valuable to readers.
Visitors landing on a site through organic search are more likely to find content that fosters conversion.
When you consider PPC, however, users have become more adept at identifying ads and are now become more sceptic towards them. The Result? Those who visit a site through PPC may already be less inclined to convert.
Discover how to track your SEO conversion rate and leverage SEO to enhance your conversion performance.
The Benefits of Using PPC and SEO Together
A common misconception in the digital marketing sphere is that SEO and PPC advertising are inherently rival strategies. While they function through different mechanisms, you can effectively integrate PPC and SEO to form a powerful search engine marketing plan.
Astute marketing professionals are well aware of their value proposition and therefore leverage them to achieve specific goals with a broader digital marketing framework. Bearing this in mind, utilising both SEO and PPC, the question of which method is “better” becomes irrelevant.
SEO… | PPC… |
Facilitates reaching potential customers at various stages in the sales funnel. | Provides valuable insights into relevant keywords and search queries used by target audience. |
Improves the user experience of the paid traffic. | Offers a means to maintain visibility and drive traffic in a competitive SEO environment. |
Contributes to the development of a site authority and trustworthiness in search engine algorithms. | Can generate a consistent stream of website traffic while SEO efforts gradually produce results. |
Curious how you can benefit from these methods? Here’s a breakdown:
#1 Testing Keywords with PPC Ads
Think of PPC ads as a test kitchen for SEO keywords. Run PPC ads targeting specific search terms and see how they perform. This gives you quick results to decide if those keywords deserve a spot in your long-term SEO plan.
The data you get from PPC, like which keywords lead to sales, is like gold for your SEO strategy.
You can even test different landing pages with PPC, see which ones convert better, and then make those winning changes to your SEO landing pages.
#2 PPC for a Quick Boost in Search Results
Stuck in a competitive SEO race? PPC can be your fast track to the top. Launch a campaign targeting relevant keywords with the right bids, and voila! You’ll be at the top of search results for those terms almost instantly. The catch? It costs money to stay there. SEO takes more time and effort to outrank competitors organically, but it’s a strategy you can sustain in the long run.
#3 PPC Drives Traffic While SEO Grows Your Credibility
The purpose of SEO is to build a strong, trustworthy reputation online. It takes time and effort, but it pays off in the long run by attracting visitors naturally. PPC ads, on the other hand, are like eye-catching signs that grab people’s attention right away. They can send traffic to your website fast, even while you’re working on improving your SEO for long-term success. This way, you don’t have to wait for SEO to kick in before you see visitors on your site.
Learn more about how PPC ads can help promote your blog while you work on ranking higher in SERPs, I can provide additional information.
#4 Reaching Customers Throughout Their Buying Journey
People rarely buy something the first time they see it. They might see your social media post, then find your blog through a search engine, and finally click on a banner ad before they decide to buy. This is a great example of PPC and SEO working together.
PPC ads can remind people about your brand after they visit your site from a search engine. You can even tailor these ads to what they looked at on your website!
The best marketing strategy uses both PPC and SEO to meet customers wherever they are in their buying journey.
#5 Double Down on Traffic with PPC and SEO
Get double the traffic by targeting the same important keywords with both PPC and SEO. This increases the chances of people finding your business, and it exposes them to your brand in two different ways. SEO helps bridge the gap between customers who might be wary of ads by providing valuable and informative content.
#6 SEO Makes Your Site Better for Everyone
Many things you do to improve your SEO for organic searches also make your site better for people coming from PPC ads. Optimising your site for mobile and increasing your page speed creates a good experience for your visitors, no matter how they got there. Plus, optimising things like product titles and descriptions for SEO also helps with PPC campaigns, potentially lowering your advertising costs!
The Takeaway: SEO and PPC are a Powerful Team
Used together, SEO and PPC can become a winning marketing combo. They each have their strengths, and when combined, they can help you reach more customers, build brand awareness, and ultimately grow your business.
How To Budget for SEO vs. PPC
You might be wondering, “So, I need to use both PPC and SEO, and do them well? How do I even budget for that?” Granted, there are other things competing for your resources.
But…
Figuring out how much to spend on each approach is key to getting the most out of your marketing budget.
Data can be a great guide in making strategic decisions like these. Let’s delve into how conversion rates can help you set initial budget amounts for both PPC and SEO marketing.
How Conversion Rates Affect Your Marketing Budget
Remember those tables we saw earlier showing how many people buy from your site? Well, for most businesses, getting customers through search engines for free (SEO) is much cheaper than paying for them to click on ads (PPC). It’s like getting more bang for your buck. But that doesn’t mean ads aren’t useful! They can still help you reach more people who might be interested in what you offer, especially while you’re waiting for your website to rank higher in search results naturally.
Spend more on the marketing method that positively impact your Return On Investment.
SAMPLE BUDGET BASED ON THE PPC AND SEO CONVERSION RATES
Let’s break down this example to understand the comparison between PPC and SEO for a B2C e-commerce company, based on industry benchmarks and some given data.
Assumptions and Data:
- SEO Conversion Rate: 4.0%
- PPC Conversion Rate: 1.8%
- PPC Cost Per Click: £1.16
- Average Order Value (AOV): £15
- Annual Digital Marketing Budget: £100,000
PPC Analysis:
With a budget of £100,000 to spend on advertising. If they use all of this money on online ads (PPC), where each click on their ad costs about £1.16 on average, they could get roughly 86,207 people clicking on their ads.
Now, imagine that out of every 100 people who click on their ad, only 2 people end up buying something (that’s a conversion rate of 1.8%). So, with those 86,207 clicks, they might get around 1,552 sales. If the average purchase made by a customer is £15 (called the average order value or AOV), then this could bring in about £23,275.86 in total revenue.
Not bad, right?
Let’s imagine, for our example, that SEO brings in just as many website visits (called sessions) as PPC advertising, even though SEO often generates more visits for the same amount of money spent.
If our conversion rate (the percentage of visitors who buy something) is 4%, then SEO would result in 3,448 sales. Assuming an average order value (AOV) of £15 per sale, that translates to £51,724.20 in revenue from SEO.
Since SEO has the potential to generate more than double the revenue of PPC advertising for the same investment, it might be wise to allocate more of your budget towards SEO strategies.
Optimising Your Budget For SEO
When looking at your marketing budget, you might consider allocating more money towards SEO, as opposed to PPC advertising. This decision is based on the fact that SEO tends to generate customers with a higher chance of converting into sales, as shown by conversion rate data.
However, it’s important to be flexible. Some businesses have even significantly reduced their PPC spending after experiencing success with SEO.
To determine the most effective budget allocation, it’s crucial to track conversion rates throughout the buyer’s journey, not just at the initial website visit. This data analysis will help you adjust your budget between SEO and PPC based on what delivers the best results.
You might be wondering why you should spend more on SEO when it appears to bring visitors to your website for free through organic search. Here’s the key point: SEO transforms random, “free” website traffic into a reliable stream of qualified leads.
By improving your search engine ranking, you achieve two important goals:
- Increased Search Visibility: Your business appears ahead of competitors in search results, making it more likely for potential customers to find you.
- Targeted Audience: SEO allows you to reach people who are actively searching for products or services like yours, increasing the chance they’re ready to make a purchase.
While optimising your website for organic search can require significant effort and resources, the potential for higher conversion rates and a strong ROI makes it a worthwhile strategy that yields long-term benefits.
Parting Thoughts
SEO vs PPC: Which Is the Better Investment for Your Business?
Forget the idea of SEO vs. PPC! They’re , working together to bring more visitors to your website. Here’s the key: SEO is a great investment that can get you a lot of website traffic for free, but it takes some effort to set up. PPC advertising lets you get seen by more people right away, while you’re building your SEO.
In the end, SEO is usually much more cost-effective, meaning you get more value for your money. So, when you’re planning your marketing budget, keep that in mind!
Want to learn more about how SEO can help your website reach its full potential? We offer free consultations to discuss your options.
