investing in search

4 Considerations When Determining Your PPC and SEO Budgets

One of the most common questions that arises in the world of digital marketing is, ‘how do I most effectively allocate my digital marketing budget?’ This question comes up frequently amongst our clients, and unfortunately there is no cut and dry response.  The answer to this question depends upon many factors, but for the purpose of this article (as well as our readers’ sanity) we’ll narrow our thoughts down to 4 important factors to consider when determining how heavily to invest in paid search and SEO.

1) Are you an established site with reasonable domain authority, or are you a completely new business?

If you are a business with a completely new site, chances are there isn’t a ton of awareness out there about your brand.  You also likely don’t have much SEO credibility, which means you’re probably not showing prominently in Google for your key terms.  To start generating leads or sales, the best bet is to begin advertising through paid search, where you can pay for immediate visibility for your most important keywords.   Because SEO improvements take much longer to take effect, paid search is your best option.  If you are a firm that is already established, with strong rankings (which would mean you’re ranking on page 1-2 on critical keywords), a more even investment could be made across paid search and SEO. This will allow you to capture leads quickly through PPC, but also continue expanding upon the organic keyword set you’re currently ranking on.

2) What does your timeline look like?

The next most logical question to consider is your timeline.  How quickly do you need to gain these leads or sales?  Do you have an upcoming deadline and are you behind on your goals for lead volume?  If you have set goals to hit a certain number of leads within the next 6-12 months, invest in paid search.  Ranking organically can take 6-12 months or longer, and by then you’ll just be starting to rank (and definitely won’t be hitting your goals).  If you have more time to spare and are more concerned with longer term lead generation, investing in organic is a safe bet to ensure you build domain authority to get your site to rank.  If you have short-term AND long-term goals you must meet, then investing in both channels is critical.

3) Are you profit or revenue focused?

Is your business more focused on profitability or revenue growth?  This is a tricky one, and timing, as well as how established your site is, definitely come into play here.  SEO and PPC can work with either of these goals, however SEO is a better long-term solution to driving efficient profit (you’re not paying for organic clicks, after all).  With PPC, you have more control over tracking and optimizing based on ROI, but it will be the more expensive option in the long run. If your site is already well-established organically, you may be able to grow your bottom line by investing more aggressively in paid search.  For lead generation, paid search will be the better option if you want a certain number of leads and want them quickly. For longer-term lead-gen, you’ll want to invest more heavily in SEO, since that’s where most of the click traffic goes.  Your KPIs are critical to consider, but timing and current positioning within organic results also play into this decision.

4) How niche is your business?

While paid search is an extremely effective and profitable channel most the time, certain ‘niche’ businesses have markets that are so specific or narrow, they may not fare so well in the world of paid search.  Businesses that require mainly long tail keywords will not generate a substantial amount of search volume.  In many cases, shorter-tail terms aren’t specific enough for these businesses, and will lead to high costs for too many unqualified leads.  In the case of a business with a niche market, SEO may be a better avenue for investment, to ensure you are gaining visibility on these same short-tail terms, without the high costs associated with unqualified traffic.  If these happen to be terms that seem too broad, it’s not as much of a risk because you aren’t paying for the click with SEO.  Relevancy is always important to consider, however it will pay off more in the long run to target broader terms that actually generate volume organically, than to run paid marketing for inefficient short-tail terms or low volume long-tail terms.

Though these are just a handful of considerations for determining your search marketing budget allocation, we hope this helps you get started in thinking about the best avenue for your company to take.

If you’d like to learn more about how Synapse SEM can help you improve your paid search or organic strategy, please complete our contact form or call us at 781-591-0752.