This picture helps illustrate the difference between Search Engine Optimization (SEO) and Search Engine Marketing (SEM).
SEO and SEM are terms that are often confused. Though both involve search engines like: Google, Yahoo!, and Bing, SEO and SEM are quite different. SEO requires planting keywords, or otherwise developing a website so it will appear higher on a particular search result list. By being closer to the top of the list, your website will generate higher traffic.
SEM, unlike SEO, is paid advertising. Your business’s ad placement depends on your bid for that keyword. The top bidder for each specific keyword will get the top ad spot associated with search results for that term. SEM is also associated with pay-per-click (PPC). This means that your business only pays for the clicks it receives on its search engine ad. Though there are a lot of cost components, SEM is a strong marketing technique. Finding the right SEM budget for your small business is key in creating an ad campaign that is both effective and economical.