What Is SEM? A Guide to Paid Search Engine Marketing

If you’ve ever wondered, “what is SEM?” you are not alone. There are a lot of terms in digital marketing that sound the same or have similar definitions. In this post, we aim to clear up the confusion.

We’ll do a dive deep into the meaning of search engine marketing (SEM) and the best practices you should follow in order to execute successful paid search marketing strategies.

Here’s what we’ll cover:

• What is SEM?
• What is the difference between search marketing, SEO, SEM, and pay-per-click marketing?
• SEM fundamentals
  • SEM platforms
  • Types of SEM keywords
  • SEM targeting
  • SEM account structure
  • SEM ad copy
  • The SEM ad auction
• SEM best practices

What Is SEM?

SEM, or search engine marketing, is the act of using paid strategies to increase search visibility. In the past, search engine marketing was a term used to describe both search engine optimization (SEO) and paid search. But now, it almost always refers only to paid search marketing.

SEM, or search engine marketing, is the act of using paid strategies to increase search visibility. Brands pay for ads to appear as search results on search engine results pages.

With SEM, brands pay for ads to appear as search results on search engine results pages (SERPs). They target select keywords so that when a user searches for those terms, they see an ad from the brand. The brand is charged only if a user clicks on the ad.

Paid search ads can be found on almost any search results page. These paid placements are typically located at the top and bottom of the page. They include an “Ad” designation to let users know that it is a paid placement.

Some paid search ads may also appear as products in a featured carousel.

Search Marketing, SEO, and SEM: What’s the Difference?

To fully answer the question, “what is SEM?” it helps to know how SEM is different from other terms related to search marketing.

Search Marketing

Search marketing is an umbrella term that refers to any tactic used to increase a brand’s search visibility or get a brand to appear more frequently in search. It may include a paid SEM strategy, an organic SEO strategy, or both.

Search Engine Optimization (SEO)

Search engine optimization, or SEO, uses tactics that improve organic visibility in search. Unlike SEM tactics that pay for placement on SERPs, best practices for SEO aim to attract search engines and earn prominent organic search placements. Organic search results don’t have an “Ad” designation on their results. They are not paid for; they are earned.

Recommended Reading: Learn how SEO works, how search engines decide what to rank, and what a website can do to attract search crawlers and gain top organic placements on SERPs in our post: What Is SEO? A Get-Started Guide to Search Engine Optimization.

Pay-Per-Click (PPC) Marketing

While trying to answer the question, “what is SEM?” another term you will encounter is pay-per-click marketing or PPC.

PPC is a paid marketing strategy where a brand creates a digital ad and is charged each time a user clicks on it. When PPC ads are shown in search results, this is considered SEM. But PPC isn’t always related to SEM.

When PPC strategies are used on channels other than search, this is not considered SEM. For example, PPC can be used on sites that support digital ads like Promoted Tweets or Facebook Ads. PPC also includes Google display ads, where brands are charged when a user clicks on a banner ad on a website.

So while PPC is an SEM tactic, it can also refer to a type of social or display ad marketing.

SEM Fundamentals: Terminology, Platforms, and Tactics

So far we’ve covered:

• What is SEM?
• What is the difference between search marketing, SEO, SEM, and pay-per-click marketing?

Next we’ll review SEM fundamentals like the terminology, platforms, and tactics that are related to paid search engine marketing.

Want to learn more about the difference between SEM and SEO? Read: SEM vs. SEO: What’s the Difference and Which is Right for My Brand?

SEM Platforms

An SEM platform is a search engine where a brand can place search ads that are displayed when users perform a search. The most common SEM platforms are Google and Bing.

• Google Ads is the most widely used SEM platform. Billions of Google searches are performed a day, so it can help you get in front of the largest online audience.
• Bing Ads claims to connect with 3 million searchers that Google can’t reach. By serving ads on partner sites such as Yahoo and MSN, Bing Ads help you connect with searchers who aren’t exclusively using Google for search.

Types of SEM Keywords

SEM keywords are the terms and phrases that you target in your search engine marketing campaigns. When users search for those keywords, they see your ads. For example, if your campaign targets the term “virtual assistant,” your ad may show when a user searches for that phrase.

When you set up an SEM campaign, you choose the keywords you want to target and/or avoid. There are four types of keywords you can use in your SEM campaigns.

1. Broad match keywords target variations of a term. This includes similar phrases, singular or plural forms, misspellings, stemmings, or synonyms of the target term. For example, when targeting the broad match keyword virtual assistant, a campaign may also target virtual assistants, online assistant, and virtual team.
2. Phrase match keywords target the exact phrase, plus any phrases that have words that come before or after the target keyword. For example, when targeting the phrase match keyword virtual assistant, a campaign may also target best virtual assistant, find a virtual assistant, and hire a virtual assistant.
3. Exact match keywords target words that are very closely related to the target term. This includes misspellings, singular or plural forms, stemmings, abbreviations, reordered words, paraphrases, or closely related words with the same search intent of the exact match term. For example, when targeting the exact match keyword virtual assistant, a campaign may also target virtual assistants, virtual assistance, and virtuals assistant.
4. Negative keywords exclude terms that you don’t want to target. Negative keywords are variations of broad match, phrase match, and exact match keywords that you don’t want to use in your campaign. These terms may be semantically related to your keywords but unrelated to the search intent of the target term, your campaign, or ad copy. Examples of negative keywords for the target term virtual assistant may include virtual assistant salary or virtual assistant training. If the ad were trying to target companies looking to hire a virtual assistant, the intent for those terms wouldn’t be relevant; therefore, they should be excluded from the campaign.

SEM Targeting

Targeting keywords tells a search platform when to show your ads. SEM targeting takes it one step further. Through targeting, you set additional parameters for when your ad should show and who it should show to.

• Location targeting sets ads to only show to people who are within a certain ZIP code or geographic area.
• Ad schedule targeting sets ads to only show at certain times of the day or during specific days of the week.
• Demographic targeting sets ads to only show to people who fit certain demographic categories based on age and gender.
• Device targeting sets ads to only show to users on specific devices such as mobile phones, desktops, or tablets.

SEM Account Structure

Account structure is the way your SEM campaigns are organized and set up. It groups relevant themes and keywords to create campaigns within your account. This Google chart shows the hierarchy of how the account structure works.

Campaigns: As the highest level within an account, each campaign has its own unique goal, budget, bid strategy, and targeting settings. Campaigns are often used to organize accounts into larger themes related to specific products, services, target audience types, or promotions. For example, a platform that matches virtual assistants with clients might have two campaigns, one to target people looking for virtual assistants and one to target people who are virtual assistants.

Ad Groups: Within a campaign, there are ad groups that break the campaign into even more specific themes. Most campaigns have a few different ad groups, and it is recommended not to exceed seven to 10 ad groups per campaign. For example, the campaign targeting virtual assistants might have two ad groups: one targeting part-time virtual assistants and one targeting full-time virtual assistants.

Keywords and Ads: Each ad group has its own set of target keywords and ads. The keywords and ad copy target the ad group’s unique audience and theme. It is recommended to have two to three ads and no more than 20 keywords per ad group. For example, the ad group targeting full-time virtual assistants might create ads and use keywords that speak directly to virtual assistants looking for full-time work, whereas the ad group for part-time virtual assistants would target keywords and use language about part-time work.

SEM Ad Copy

For the most part, SEM ad copy mimics organic search results. But they also have options for showing additional information. A standard ad usually includes two headlines, a description, and a website URL. You can also add:

• Sitelink extensions
• Callout extensions
• Call extensions
• Message extensions
• Location extensions
• Advertiser ratings
• Price extensions
• Structured snippet extensions

SEM platforms may also offer additional search ad formats such as product carousels.

The SEM Ad Auction

When you set up an SEM campaign, that doesn’t mean your ad is going to show every time someone searches for your target keyword. SEM platforms have a built in system that decides if and when your ad shows, and how it competes with other brands that are targeting the same keywords. This system is called an Ad Auction, and it is based on three factors.

• MAX CPC Bid – the maximum amount you are willing to pay when someone clicks on your ad.
• Quality Score – a rating that the platform assigns to your ad. There is no clear formula for Quality Score, but it is believed to be based on factors such as your click-through rate (CTR), the relevance of keywords to the ad group, the relevance of landing page to keywords, and historical ad performance.
• Ad Rank – a rating that the platform gives to your ad to determine where it will show on SERPs. The higher your Ad Rank, the better placement your search ad will have.

These three factors are used to determine who “wins” the Ad Auction and gets the best placement on search engine results pages.

Max CPC Bid x Quality Score = Ad Rank

The main takeaway from this formula is that brands with a high Quality Score can outperform brands with a higher max CPC bid.

How to Improve SEM Results: Keys to Creating Powerful Campaigns

Creating effective SEM campaigns requires research and strategy before you set up your campaign, as well as after your campaign is already running.

The following tactics can help you optimize your campaigns so that you reach more people, maximize your budget, and drive more conversions.

Creating effective SEM campaigns requires research and strategy before your campaign is set up, as well as after it starts running. Click To Tweet

Perform Keyword Research

One of the biggest keys to SEM success is choosing the best keywords to target. Conduct keyword research and find terms that:

• Are used by your target audience. Sort results by keyword popularity to identify the top phrases that your audience regularly searches for. Use a tool like Alexa’s Keyword Difficulty Tool to find the most popular phrases related to your business and industry.

• Work at the end of your sales funnel. Identify high-converting buying keywords that target prospects near the bottom of the purchase funnel. Use the buyer keywords filter on Alexa’s Competitor Keyword Matrix to identify search terms with high purchase intent that already drive traffic to your competitors, but not to you.

• Fit within your budget. Consider the ROI you expect to receive from your campaigns and choose keywords with a cost-per-click that will lead to a positive ROI.

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Create Compelling Ads

For an SEM campaign to be effective, it needs to compel searchers to click on the ad. To get more users to click on your search results, use the following tips while creating your ads.

• Use the keyword in the ad copy.
• Clearly communicate to the reader the benefit or solution you’re offering.
• Connect your copy to searcher intent.
• Include prices and promotions when relevant.
• Include a clear call to action.
• Utilize ad extensions.

Improve Your Quality Score

. Work to improve your Quality Score by incorporating target keywords in both your ad copy and landing page it leads to. This lets SEM platforms know that the ad and destination URL are aligned to the searcher’s intent, which leads to a higher Quality Score.

Optimize Existing Campaigns

If you want to get the most out your SEM strategy, you need also to learn how to improve SEM campaigns once they are launched.

To get the best results, continue to optimize campaigns once they start running.

• Add additional relevant keywords. You may have missed keywords when you initially created your campaign. Review the campaigns and add any suggested keywords that might be missing.
• Set negative keywords. Review your campaign and remove keywords that are attracting the wrong type of traffic. Set low-performing or irrelevant terms as negative keywords.
• Utilize A/B testing. One benefit of SEM is that you can get faster feedback about what works. Use A/B testing to create different variations of your ad strategies. Review what works and tweak your campaigns to find the highest-performing combination of targeting, ad copy, keywords, and landing pages.

Start Crafting Your SEM Strategy

Now that you can confidently answer, “what is SEM?”, begin planning and executing your SEM plan. Start by using the tools mentioned in this post to find the best keywords for your campaigns.

Sign up for a free trial of Alexa’s Advanced Plan to access paid keyword research tools that will help you identify the top terms your customers search for. You’ll also get access to audience analysis and competitive website analysis tools to help you learn about your audience and competitors, so you can develop competitive paid search marketing campaigns that get results.

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