Marketing
In the digital marketing world, there’s an ongoing debate about SEO vs PPC. Which one is better for conversions and ROI. In this article, we’re going to create some clarity by touching on the pros and cons of each platform, industry benchmarks and how each of these strategies can fit into your larger marketing plan.
Before we dive in, we’ve first got to clarify what PPC and and SEO are, how they work, and more importantly how they can help you achieve your marketing goals.
SEO stands for search engine optimisation and is a series of best practices used to increase your website’s organic traffic. A good SEO strategy is made of three pillars that include technical, on-page and off page optimisation.
Technical optimisation is concerned with the behind the scene factors including site speed, navigation and mobile-friendliness. On-page is all about your website’s content including copy, blog articles, meta tags and more. Off-page is the pillar most commonly ignore and refers to actions taken on other sites to increase your ranking. Examples of this include writing content for media sites and creating backlinks.
PPC stands for pay-per-click advertising and encapsulated everything from banner ads to paid search ads at the top of a Google SERP.
SEO offers a lot of benefits for businesses and when done correctly, is a great way to boost awareness and credibility. Great SEO allows you to capture impressions for highly competitive and valuable keywords that are otherwise expensive to win with advertising.
But at the same time, SEO does have some cons. The big one is that it takes time to be effective - it typically takes 3 to 6 months to see consistent and meaningful results. At the same time, SEO results compound over time and yield progressively better ROI the longer your efforts continue.
A second problem with SEO is how difficult it can be to budget. The reason for this is SEO costs are not as clear-cut as paid channels. SEO is a resource-heavy strategy and requires a lot of content and website updates over months to yield results.
Similar to SEO, PPC campaigns can also be used to build awareness and drive customers to your site. Unlike SEO, PPC doesn’t require a long ramp-up time so advertisers can start seeing results in days.
PPC also has the advantage of allowing you to retarget site visitors and test messaging quite efficiently. At the same time, PPC does have a number of drawbacks.
The biggest issue with PPC is the ongoing cost. PPC campaigns require a budget and depending on the industry, this amount can be very expensive. Across all industries, cost per click is on the rise which means budgets have to progressively increase over time to yield similar results. At the same time, turning off a PPC campaign will stop paid search traffic.
The advantage of being able to target desired keywords and terms is also a disadvantage as it’s just as easy for competitors to do so too - and they can also see which terms you’re bidding on.
Conversion rates for both PPC and SEO vary depending on the industry. For nearly all major industries, SEO surpasses PPC but there are a few outliers. We’ve included a table below.
5 industries with the biggest gaps in SEO vs PPC conversion rates
A big reason for this gap is likely to be credibility. Google places value on content that is trustworthy, authoritative and valuable to the reader. At the same time, search engine users have become better at recognising advertising and become more sceptical.
Meanwhile, searchers are getting better at recognizing advertising, while at the same time, they’re becoming more sceptical of it. Users who arrive on a site through PPC may already be less likely to convert.
Our view on the SEO and PPC debate is that they shouldn’t be pit against each other - they have both have a part to play in every inbound digital marketing strategy. We recommend using SEO and PPC to serve distinct objectives so as to avoid arguments over which one is ‘better’.
SEO:
PPC:
Before investing in your SEO keyword strategy, you can use PPC ads to validate the terms. Within weeks, you would have gathered enough data to determine whether you should incorporate these keywords into your SEO planning.
A great example of this is the A/B testing of landing pages. Over a two week period, drive paid traffic via key terms to each variation. At the end of the two weeks, use the dataset to determine whether your test was successful and what changes can be integrated into those ranking on SERPs.
A unique advantage to PPC is that you can drive as many leads as you want provided you have the budget for it. What you can do is set up a campaign, target your keywords and you’ll nearly instantly be at the top of the page. You’ll be able to outrank competitors provided you have the money to do so. SEO, however, takes time to outrank which is why we’re leading into benefit 3
While you’re working on your long-term SEO strategy, invest in PPC to fill in the gaps. Once your SEO efforts start to yield results, you can pull back on your PPC spending. This way, you’re appearing in search of all of your desired keywords at all times.
Most buyers will reach your business via a mix of multiple channels. For example, they may become aware via social media ads, find your content via a Google search and then reengage thanks to a display ad. This is a good example of how SEO and PPC can work together to keep your brand top of mind after the first interaction.
By building PPC campaigns around the same keywords you’re optimising for organically, you’ll be able to have your business featured on page one of Google twice. Doubling up increases the likelihood of a custom encountering your business in SERPs and clicking through.
Two of the pillars of SEO we mentioned are technical optimisation and on-page optimisation. Technical optimisation ensures your website loads quickly and is mobile-responsive - both of which create a better experience for traffic. Onpage optimisation including improving titles and meta descriptions to match intent not only boosts SEO but improves the QUality Score in Google Ads. Google rewards high-quality landing pages and websites which means a lower cost per click.
Although all of the above sounds amazing and puts a strong case for investing in SEO and PPC, you need to have the budget. Furthermore, you need to split your budget appropriately between both channels to ensure you’re getting the best of both worlds. For many marketers, budgeting like this can be difficult. Our recommendation: align your investment based on the relative ROI of each channel.
To provide a simple example, let’s say we have a B2C e-commerce business. From the table above, we know that:
And let’s assume that:
If the business was to spend its entire budget on PPC advertising, those ads would drive 8,621 clicks. With a conversion rate of 1.8%, the PPC ads would generate 155 sales and assuming the AOV is $15, ~$23,250 in revenue.
For the sake of argument, let’s assume that SEO would drive an equal number of visitors to the website (8,621 visitors). With a conversion rate of 4%, SEO would drive 345 sales and $51,726 in revenue.
So if SEO is producing more than twice as much revenue for the same investment, your digital marketing budget should reflect that.
Depending on the conversion rate, you may decide on a 60/40 or even 70/30 split in favour of SEO. We’ve seen a number of clients cut their PPC budgets even further after seeing the revenue generated by their SEO campaign. At the end of the da, use your data to determine conversion rates and get an accurate sense of the true ROI of your campaigns so that you can continue to adjust your spending and budget split over time.
When you look at the new SEO/PPC budget split, it might look like more money than you’ve ever budgeted for SEO before. Why would you invest so much money in driving traffic from organic search when it delivers customers to your website “for free?”
The answer to this is that SEO is a discipline that amplifies your luck-of the draw or “free traffic” into a pipeline of qualified leads. Investing in SEO and climbing the ranks Google means that you’re more visible to prospects which in turn means that your business will be found ahead of your competition and at the exact time your prospect is ready to hear from you.
It’s no secret that a lot of resources go into SEO but given the higher conversion rates and ROI, it’s one of the few inbound marketing investments (outside of content marketing) that pays dividends that compound over time.
The reality is that both SEO and PPC are valuable additions to almost every inbound marketing plan. The biggest takeaway that we want to emphasise is that SEO is one of the few strategies that is a worthwhile investment in its own right - it would be a big mistake to not explore the opportunities it has on offer.
While all channels play an important part in your overall inbound strategy, it’s SEO that will create the greater return on your investment and your marketing budget should reflect that.
If you’re looking at investing in SEO but want to learn more, get in touch with us today for a free SEO consultation and audit.
