From it’s initial inception, the term “SEM” referred soley to Google’s pay-per-click advertising network that displayed ads at the top of it’s search engine. As time progressed and search engines became more advanced the term began to take on the form of a “catch all” for any kind of marketing done in a search engine (SEO, PPC, Display, etc.). This has led to a lot of confusion amongst people.
In it’s purest form, SEM pretty much involves paying for advertisement in some way or another. An Facebook ad campaign that triggers display advertising (banner ads) in it’s search engine results is a form SEM. SEO’ing an AdWords™ ad in order to improve it’s quality score and, as a result, get a lower bid on the ad is a another example search engine marketing (SEM). The AdWords™ ads themselves are yet another example of SEM, and the one most people are familiar with.
SEM can be an overnight success since traffic starts showing up immediately when people buy ads. However, this can be deceptive because if an SEM campaign is not optimized than ROI can start to suffer.
SEO is about optimizing pages so that they rank naturally. In this way, many people look at SEO as “free advertising” but in truth it has a price as well:
Time.
It can take months to optimize an ecommerce site if it’s comprised of thousands of pages with new one being added regularly. This is because SEO involves monitoring results and seeing what changes on a page equal a postive rank change as well as a negative one.
To get the absolute most out of the potential customer base that passes through Google in large volumes day to day it’s best to run both SEO and SEM campaigns. The most “Google Estate” will be covered this way.