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Search Engine Marketing , or SEM, is the practice of marketing and advertising through Internet search engines. It includes both advertising and optimization efforts to promote a website by increasing its visibility in search engine result pages (SERPs). Search engine marketing methods include: search engine optimization (or SEO), paid placement or Search Engine Placement, and paid inclusion. Another definition of search engine marketing is the practice of buying paid search listings. In recent years, search engine marketing grew at a much faster rate than traditional advertising.

As the number of websites increased in the mid-to-late 90s, search engines started appearing to help people find information quickly. Search engines soon developed business models to finance their services, such as “pay per click” programs offered by Open Text in 1996 and then Goto.com in 1998. With “Pay Per Click,” an advertiser only pays when a user actually clicks on an ad to visit the advertiser’s website. Thus, advertisers bid on keywords they predict their target market will use when they are looking for a product or service online. When a user types in a keyword that matches the advertiser’s “keyword list,” or views a page with relevant content, the advertiser’s ad maybe shown. These ads are called “sponsored link” or “sponsored ads,” and appear next to or above the “natural” search engine results pages, or anywhere the webmaster chooses on a content page of a website. Goto.com changed its name to Overture in 2001, and was purchased by Yahoo! in 2003. It now offers paid search opportunities for advertisers through Yahoo! Search Marketing. In 2000, Google also began offering advertisements on search result pages through the Google AdWords program. By 2007 pay-per-click programs proved to be the primary money-makers for search engines. Search engine optimization consultants expanded their offerings to help businesses learn about and use the advertising opportunities offered by search engines. As a result, new agencies emerged that focus primarily on marketing and advertising through search engines. Today, search engine marketing is stronger than ever with SEM budgets up 750% when comparing stats from 2002 to 2006. However, paid search advertising isn’t without controversy. Issues around how many search engines present advertising on their pages of search result sets have been the target of a series of studies and reports by Consumer Reports WebWatch, from Consumers Union. The FTC also issued a letter in 2002 about the importance of disclosure of paid advertising on search engines, in response to a complaint from the consumer advocacy group, Commercial Alert.

Search engines with SEM programs include:

Microsoft Live
Baidu (China)
Yandex (Russia)
Rambler (Russia)
Timway (Hong Kong)


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