The key to marketing has always been getting one's product recognized by as large a group of people as possible. Advertising has always been the key to any marketing effort. Companies spend millions on ad placements in trimedia campaigns that encompass print, radio and television.
Print, radio and television have traditionally been the main medium for marketing. However, in the past decades, another form of paid advertising has found itself on the rise, and this utilizes the internet.
Search engine marketing (SEM) is a form of internet marketing. It uses the web as a medium to spread awareness of its target product. Internet marketing has emerged as a cheap yet dynamic way to distribute information in the global market.
SEM seeks to promote websites - and the products being sold on those websites - by increasing their visibility through search engine results pages.
The development of SEM is an off-shoot of the success of the Internet in the global arena. As more and more people started using the web, more and more sites on a variety of topics started being created. In the mid-to-late 90s, search engines were developed to help people find the information they wanted quickly.
Soon search engines developed business models to finance their services such as pay per click programs.
A pay per click program is a small text ad that appears next to results from an on-line search. A marketer buys the rights for their ads to appear on a web page or a search engine. The ads are tied up to key words. When a searcher types in a particular query to a search engine, the engine not only offers up a listing of relevant websites but also the marketers "ad".
The first pay per click programs were offered by Open Text in 1996 and Goto.com in 1998. Goto.com changed its name to Overture and was purchased by Yahoo in 2003 and is now Yahoo! Search Marketing.
SEM methods include: Search Engine Optimization (or SEO), paid placement, and paid inclusion.
Search Engine Optimization is a strategy by which you attempt to improve the volume and quality of traffic to a website by "marketing" it to a web site. Using key words and content to ensure your site shows up many times during searches.
Paid placement is the pay per click program. Advertisers pay when a user clicks on to the links to visit their web site. These are also known as sponsored links or sponsored ads. Google Adwords, Yahoo! Search Marketing and MSN adCenter are the largest network operators of the pay per click program as of 2007. Minimum prices per click start at US$.01 to .50.
Paid inclusion is when a search engine company charges fees for the inclusion of a website in their search index. This fee structure is ment to ask as a filter against superfluous submissions - websites that try to "trick" the engine by using popular key words that are unrelated to actual content of site - and a revenue generator for the search engine company. The fee is typically an annual subscription rate.
SEM is a relatively cheap and inexpensive way to create traffic on you web site and cultivate brand recognition. A pay-per-click program is cheaper then a trimedia campaign and yet can reach a large number of people globally day and night. As a result, many companies are now taking advantage of the internet to let consumers know what they have.
According to a recent report by the Search Engine Marketing Professional Organization, advertisers in North America alone spend $9.4 billion in SEM in 2006. In 2006, the majority of search marketers (62%) said branding was the primary objective of search marketing campaigns. Nearly as many, however (60%) said that selling products was a key objective. This year, direct sales were the top choice, at 58%, followed by brand awareness at 57%. For more companies, SEM spending is increasing and actually earning a bigger budget then other marketing techniques. It is estimated that by 2011, companies will be spending $ 18.6 billion on SEM.
This growth will be driven by strong advertiser demand, rising keyword pricing and more small and midsized business discovering the effectiveness of SEM.
Currently, SEM is an alternative marketing tool with many possibilities. It's increase in popularity will eventually result in more businesses utilizing SEM techniques and a possible rise in rates for web space. The faith major businesses are placing in SEM - as denoted by the money they are willing to spend on it - makes this fast growing advertising technique that should be utilized by any business seeking to make a name for it's globally.