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Paid Vs. Organic Search: What Are The Benefits & Downsides Of Each Method?

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This is a guest article by Arjun Sandhu, CEO of digital marketing specialists Modulus Systems.

The job of search is to acquire the highest possible number of qualified leads for the best possible return on investment. But most businesses are not happy with the former, while many admit they have no way of measuring the latter.

According to research by HubSpot (2016), generating traffic and leads was identified as the top marketing challenge by 65% of businesses. Demonstrating a return on investment for marketing activity was the next biggest challenge, mentioned by 43% of those in the survey.

Both figures demonstrate that search engine optimisation (organic search) and search engine marketing (paid search) continue to pose a challenge. On the one hand, search is increasingly seen as the most important marketing discipline, particularly for digital businesses. On the other hand, nearly half are not sure if it is delivering value.

That’s quite a big admission because according to one recent estimate, annual spending on search engine marketing in the US alone was at $65bn in 2016, rising to $80bn by 2020.

So why is so much money being invested in search marketing and why is so much of it wasted?

The first part of the question is easy to answer. For any given search, the first page that comes up on Google gets 92% of the traffic. It doesn’t take a degree in diminishing returns to work out what’s left on subsequent pages. The top item on the first page for any search can expect around 33% of the clicks.

Organic search is among the most effective ways to generate leads. More importantly, perhaps, organic search leads have a 14.6% close rate, more than eight times higher than typical rates for email and other outbound marketing techniques.

Organic search takes longer to develop. Climbing the search engine rankings means developing engaging, relevant content, getting high-authority websites to talk about you, and offering users what they’re looking for. The days of stuffing your site with keywords are long gone. If you’re trying to game the system, Google is on to you: only the highest quality standards will earn you a coveted spot on the first page.

An organic search ranking is worth winning. Consumers trust organic results. And while you need to maintain your ranking, once won, it’s yours.

By contrast, paid search disappears as soon as you stop paying. Consumers know they are clicking on an advert, so trust is generally lower. But paid search has clear advantages. You can buy your way up the rankings if your pockets are deep enough. The entry costs can be higher but so are the potential rewards – paid search accounts for fewer clicks (perhaps 6-10% of the total) but proportionally more revenue than organic.

Organic is a great way to develop as a thought leader and win over customers who need more persuasion, whereas SEM is perfect to attract an audience that is ready to buy.

Which is better? If there were a clear answer to this question, we’d have found it by now. The truth is that it depends. Medium and large businesses probably need to deploy a combination of the two. For example, organic search enhanced with paid marketing tactics like remarketing is an effective strategy to convert onlookers into long-term buyers.

As for return on investment, on the face of it nothing much has changed since a 19th century department store owner declared: “Half the money I spend on advertising is wasted; the only trouble is I don’t know which half.”

For all the magic weaved by Google with its clever algorithms, and for all the efforts of self-appointed experts to exploit them, most businesses still don’t know whether they are getting a return from search marketing. But some do. The ones that are asking the right questions have the satisfaction of watching their competitors waste half their money. They could probably even tell them which half.

By Arjun Sandhu

Arjun Sandhu is CEO of digital marketing specialist Modulus Systems. Modulus Systems provides online marketing with top organic Google ranks in UK, rest of Europe and United States in the most competitive industries. In depth knowledge of user behaviour, search engine algorithms, paid search and now mobile are our core-competencies.