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What is the difference between SEM, SEO, PPC, and Google Ads?

Nina De Winter

63% of businesses have increased their digital marketing budgets just this past year. If that statistic doesn’t illustrate the popularity of digital marketing and advertising, we don’t know what will.

With growing appeal comes the importance of developing a thorough understanding of advertising and its jargon. Our team at Casa Media is aware of that, which is why we happily remind you of some of the most important advertising terms: SEM, SEO, PPC, and Google Ads.

What is SEM?

Search engine marketing, often abbreviated as SEM, refers to promoting websites by improving their visibility on search results pages (SERPs). This can be done through paid advertising.

Throughout time, the meaning of SEM has changed. Typically, this form of marketing was an umbrella term encompassing various forms of internet marketing, designed to enhance a website’s visibility on search engines. 

However, as time passed by, search engine marketing has become closely associated with paid search strategies only. As a consequence, marketers now view SEM as the approach of acquiring advertisements on search engines in order to increase website traffic.

This form of marketing is also known as PPC (Pay Per Click) advertising, and uses platforms to use the available ad formats to reach your target audience. Examples are Google Ads and Bing Ads.

If you’re wondering what that looks like in practice for online users, we have got the answer for you. 

Imagine that your jewelry business is running advertisements about its new collection. If a potential client is researching keywords related to your advertisements, they will see a custom ad, usually at the top of the SERPs. In some cases, shopping ads may even occur. Every time someone clicks the ad, you pay for it.

What is SEO?

Although SEO is similar to search engine marketing, a distinction has to be made between both concepts.

Search engine optimization refers to the increase of your website’s traffic and improvement of its quality through organic methods

The key difference with SEM lies in the latter: SEO is the practice of stimulating the organic growth of your website, while its conceptual sibling uses paid techniques to appear in search results.

In practice, SEO means that a business analyzes relevant search terms that can support its place in SERPs. 

Next, one will optimize their website through content creation, on-page SEO, technical SEO, and off-page SEO.

Are you asking yourself why that is necessary? We have the answer for you: what is the point of attempting to improve your search ranking if you are blind to significant keywords?

Are you wondering what organic SEO is? Learn all about it and how you can use it to boost website traffic with Casa’s tips and tricks in this article.

If you have SEM and SEO strategies in place, but aren’t seeing the results you’re dreaming of, there’s most likely a weak link in the chain.

Here at Casa Media, we’d be thrilled to turn your digital advertising into a success! 

What is PPC advertising?

Just like the name insinuates, Pay Per Click (PPC) advertising is an advertising model that an advertiser pays every time someone clicks on an ad

Every time someone goes to your website, you pay the host of the platform you’re advertising on. Examples of platforms are Facebook, Google, LinkedIn, Instagram, Twitter, Bing, and more. 

You can conquer an online space for a PPC advertisement, you need to win the bid for that ad position. Most of the time, this consists of real-time bidding, such as Google Ads.

Keep in mind that with Pay Per Click advertising, you should always understand the ad auction process of the chosen advertising platform.

Also, it is not because you pay a fee for each website click that you lose money. In fact, let’s say that you pay 3 dollars per click, but a click results in a sale of $200, we can clearly see that it’s a profitable ad.

PPC ads appear in different shapes, going from plain text to videos. They can show up on search engines, websites, and more.

Important PPC terms to know

Pay Per Click marketing can be an effective advertising strategy to bring more traffic to your website and appear higher in search results.

However, it is easy to be confused when it comes to all the definitions related to Pay Per Click advertising. 

That is why we are here to clarify the most important terms for you.

Gmail ads are part of PPC advertising, and are always displayed in Gmail users’ inboxes

Cost Per Click

The Cost Per Click (CPC) refers to the cost that an advertiser pays for each click on their advertisement. 

This metric applies to all types of advertisements – whether they are textual, images, or videos. At the same time, they relate to ads displayed on SERPs, display ads, and social media advertisements.

The Cost Per Click depends on various characteristics, such as keyword competition, and the quality of the ad.

Although the CPC is related to the PPC (Pay Per Click), there is a fundamental difference between both terms.

Pay Per Click covers an advertising model according to which you pay for each click on your advertisements. As mentioned before, CPC is the specific cost associated with each of those clicks.

Keep this contrast in mind when you’re analyzing the success and metrics of your advertising strategy.

Cost Per Conversion

A second must-know advertising term is the Cost Per Conversion, which determines converting a lead into a customer. This takes your first client into account.

You can calculate this parameter by dividing the total cost of your marketing campaign by the amount of conversions you have.

You may be asking yourself right now what the ideal cost per conversion is. There is no concrete answer for that, as this metric can vary depending on several factors such as the industry, advertising platform, your specific goals, and audience.

Want to have a better understanding of conversion? Be sure to check our article on how to optimize conversion funnel to get the most out of it.

Search ads are an effective way to appear at the top of SERPs, stimulating interaction and possibly conversion

Cost Per Mille

Cost Per Mille (CPM) is a pricing model that describes the cost an advertiser pays for every one thousand impressions of an advertisement.

Following this bidding strategy, advertisers pay a set cost for every 1,000 times their advertisement is shown. This happens regardless of whether online users simply view the ad or actually click on it.

CPM is a useful parameter for businesses that aim at reaching a broad audience and creating brand recognition. Since this method does not guarantee engagement or conversions, it is the perfect catalyst to building brand visibility and awareness.

Cost Per Acquisition

The final advertising measurement you need to be aware of is the Cost Per Acquisition (CPA). 

This financial metric illustrates the revenue impact of a Pay Per Click advertising campaign. One can calculate it by dividing the total amount of money spent on PPC ads by the number of conversions.

The CPA can be useful in case you want to have an overview of how much you’re spending on your advertising campaigns in comparison to how much you’re earning

The latter is essential to understand how efficient your marketing efforts are in acquiring new customers or leads. At the end of the day, that is what marketing is about: driving conversion.

Display dynamic image ads are conversion-oriented

Google Ads

The message of this article wouldn’t be complete without mentioning Google Ads. 

Whether you are a frequent user of this platform or have never seen its dashboard before, most people have a vague understanding of Google Ads.

Casa is here to clear the air: Google Ads is Google’s advertising channel for PPC campaigns. It provides a variety of advertising formats, targeting options, and bidding strategies.

As an advertiser, you should set a budget and bid on relevant keywords to determine where and when advertisements will appear in Google’s search results.

Also, Google Ads presents marketers with detailed performance metrics that can help them to reduce costs and improve ad performance.

Google Ads manages YouTube ads, like this example

What to remember about SEM, SEO, PPC, and Google Ads

Now that you are familiar with the key advertising concepts of SEM, SEO, PPC, and Google Ads, it is time to apply the knowledge to the action. 

In this blog post, you learned everything about search engine marketing, search engine optimization, Pay Per Click advertising, and Google Ads. 

You also became familiar with relevant PPC terms to enrichen your advertising jargon. With a backpack full of marketing knowledge, you are now ready for advertising success.

Are you overwhelmed by the variety of marketing terms, unsure where to begin? Don’t worry – Casa Media is here. Our team of advertising experts would love to work with you to take your advertising game to the next level. 

Published

27 October 2023

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