Adwords vs. SEO - Which is best?

Renting vs. Buying Image

Keywords are Crucial

As we’ve moved into an increasingly digital society, websites and online interactions have become the backbone of any successful business. Some businesses operate solely online which makes getting people to their website the number one priority.

Investment into driving traffic to websites has exploded, with companies carving out massive amounts of money in their budgets for digital or online marketing.

"Why are businesses so happy to fork out so much money on AdWords, but so little on SEO?"

Some of the larger equipment manufacturers out there have obscene AdWords budgets which spiral into the millions every single year. Smaller companies obviously don't have this much to spend, but still, many of these businesses are willing to take a huge chunk of their budget and use it on AdWords campaigns. However, SEO doesn’t get the time of day.  Not only that but talking to a various selection of these companies they don’t track accurately enough on the exact conversion rates and ROI.

Instant Gratification

It seems because AdWords delivers an instant return, people are happy to spend the money. Paying $20,000 and getting a return of $40,000 people seem to think is a sensible business investment. But this merely delivers short-term results.  The same people then begrudge $1000 per month for SEO and for what reason?  No short term ROI?  What about your margins?  Some literally making no profit just to add turnover or hit ‘sales targets’.

"Even more worryingly, companies aren't accurately tracking conversions or ROI"

As soon as you stop paying for an AdWords campaign, your results (and returns on investment) will disappear. Your visibility drops, along with your traffic.

SEO on the other hand, takes time to see results. Paying an SEO agency a fee every month can feel risky, especially as it takes time to see results and a return on investment. But that’s exactly what you’re paying for - a long-term investment.

Once the SEO starts to take shape, and your website starts to rank on page 1 of Google, it will deliver more returns without the need for you to pay for every click. It starts to work out as a more cost-effective form of marketing, especially when you factor in the astronomical costs of some popular keywords on AdWords.  Not only that but the organic positions far out perform the PPC positions in regards to CTR (Click Through Rate).  So cheaper both in the short term, the long term and it generates more traffic over a sustained period of time.

Revenue is Vanity, Profit is Sanity

This is a live example of a client’s recent PPC and SEO annual report:

  • PPC spend over 12 months $750,000 + $25,000 management fee which generated Total Sales of $4,000,000
    • If we use a 20% margin ($800K) on PPC attributed sales of $4M, and factor in the cost of PPC ($775K) the profit overall is $25K ($800,000-$775,000 = $25,000)  
  • SEO spend over 12 months $100,000 which generated Total Sales of $1,200,000.
    • Their 20% margin ($240K) on SEO attributed sales of $1.2M costs far less to generate ($100K) leaving a profit of $140,000 ($240K-$100K)
  • PPC ROI
    • 25,000/775,000 * 100% = 3.23% ROI
  • SEO ROI
    • ​140,000/100,000 * 100% = 140% ROI

If you compare search engine optimisation pricing to Google AdWords pricing, and consider profitability as opposed to revenue, it’s clear to see the long-term benefits of SEO.

Search Engine Optimization is the most profitable form of marketing you can do

Renting v Buying

Owning an Asset

You can use the idea of renting vs buying a home to compare AdWords and SEO.

Renting a home is great in that you pay a certain amount each month and get a place to live. However, as soon as you stop paying your rent, you no longer have a home. And all that money you’ve spent on rent in the past has disappeared, with nothing to ultimately show for it. This is AdWords.

Buying a house costs more money up front and it takes time to tailor it to your specific tastes and style; making it a home for you to live in. But you now own this home - it is yours to keep, in this fixed location, and becomes more valuable over time. This is SEO.

The money you spend on SEO not only delivers you better results than AdWords in the long-term, it allows work to be done on your site to ensure it’s the best website in your field or industry. AdWords money merely delivers you fast, short-term results with no care given to the fundamentals of your website.

"The web services team provided SEO benefits that could be measured over time and lead to increased brand awareness and lead generation for the pharmaceutical campaign."

Check out the full Bruker testimonial or contact us today for a free consultation about your keyword strategy and the best way to implement any Adwords or SEO campaign.

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Posted by Dave Cockett

Dave has 18 years’ experience in digital marketing & started his career in the midst of the .com boom. Dave worked with Blue Chip search engines Lycos, Ask Jeeves & for a brief period MSN before successfully founding his own Digital Marketing Agency. Dave’s main skill sets are Search Engine Optimization and Conversion Rate Optimization. He brings all the necessary experience and skills to help lead our web services team. He is a passionate about educating businesses in what ‘SEO’ is and how they can increase their own enquiry and conversion rates. On the days he’s not optimizing he loves watching Burnley FC and testing his skills at the poker table.

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