1. SEO (Search Engine Optimization)

2. Paid inclusion and,

3. Paid placement.

According to the statistics, in the year 2006, advertisers in North America spent a whopping $9.5 Billion on SEM, which is a 62% raise against the year 2005 and a 750% raise against the year 2002. Following are the three biggest SEM vendors:

1. Google AdWords,

2. Microsoft adCenter, and

3. Yahoo! Search Marketing.

A report in 2006 revealed that Search Engine Marketing is growing more rapidly than traditional advertising.

Since the number of websites started increasing during the late ?90s, search engines started to guide people to get the necessary information within microseconds. Search engines have developed their business models to be financed by services like Pay Per Click (PPC) programs through the use of Open Text in the year 1996 and http://Goto.com in 1998.

In 2001, the name of http://Goto.com was changed to Overture, and Yahoo! purchased it in 2003. Today, Yahoo! Offers paid search programs to advertisers via Yahoo! Search Marketing. Google started offering ads on the pages of search results from 2000 through Google AdWords. It was predicted that by 2007, PPC programs will be the elementary money makers for search engines, and that has become true.

There have been many controversies regarding Paid Search Advertising and issues on the number of search engines that present the advertisements on their search result pages. In the year 2002, the FTC issued a letter that talked about the importance of paid advertising in search engines. This letter was issued with a response to one of the complaints received from Commercial Alert, an advocacy group formed to protect consumers from commercialism.

It is often confused that Search Engine Optimization and Search Engine Marketing are the same. No, they are not the same thing. As mentioned earlier, SEO is just a part of SEM. Click costs are involved in SEM; whereas, SEO primarily works on the principle of free traffic. These two facts form the basis of a very popular myth: It is easier to see a good ROI (Return on Investment) through SEO than through SEM. But, there are a lot of points to prove that the above stated myth is not true. One significant factor is the landing page difference.

Through SEM, you can decide on the landing page that you want your visitors to see. But in SEO, spiders of the search engines decide the landing page. One thing that has to be kept in mind is that a visitor will not necessarily think that your site is the best. Only if your landing page is optimized well enough for the keywords being searched, your visitor will think that he/she is in the right place.

Regardless of how beautiful your site looks, if the landing page is only good looking but not relevant, your website doesn't serve the purpose, and hence will lose out on its business. Only a good Search Engine Marketing firm can develop a good landing page, not a search spider.