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The debate has raged since the dawn of search engines as a dramatic traffic source for websites: SEO vs PPC. DrivingSales offers a venue for this debate to continue in the automotive arena, and despite attempts to spark a panel, nothing has transpired.
Thus, I'll put down my own thoughts on the matter and hope that others confirm or deny what I say.
PPC: Renting Your Search Engine Home
Being flexible, nimble, and in control of your message and where it is placed is the biggest selling point for PPC. While most agree that sponsored listings only account for about 1/4th of the clicks on search engines, there are those who are willing to sacrifice the bulk in favor of that control.
It's like renting a home. You aren't stuck in one place for 15-30 years (or in the case of the search engines, for months at a time). Renting search engine space means that you get to move in quickly and have an instant impact on your traffic.
The bad part about renting search listings through PPC is that the investment is contingent on you continuing to pay. The biggest reason that many vendors push dealers towards PPC over SEO is because it's the gift that keeps on giving. Dealers who rely on PPC must rely on it indefinitely. Once the money stops getting spent, the listings stop sending traffic. Vendors know this. You could spend $20,000 a month for 3 years, but if you ever decide to stop "paying rent" your search results disappear.
SEO: Buying Your Search Engine Home
SEO has many setbacks. It isn't instant (even though it delivers much faster results than most would have you believe). It isn't guaranteed. With PPC, you pay your money and get listed. With SEO, you may pay your money and never really get what you expected (if you pick the wrong SEO firm or web provider).
There are really only 2 clear benefits to "buying" your search engine home:
Automotive SEO is more of a commitment. It is more challenging. It is also more rewarding if you select a provider that knows what it's doing.
Rent AND Buy
For those who have the budget to handle both PPC and SEO, you're in a great position. The best strategy is to use organic listings as the base and then utilize PPC to go after keywords that are either too small to "mess with" organically or too large to rank at the top through SEO.
Many like to use PPC as a method of getting more exposure, to "double up" on important search terms. Budget permitting, this isn't a bad idea. If you're like most dealers, having the luxury of extra budget that can be spent doubling up is unlikely.
Footnote on Social Media
Some people have been trying to lump automotive social media into the debate. While social media is something that can be used in SEO as well as search engine reputation management, the type of marketing associated with social media is nothing like search engine optimization or PPC. If anything, social media marketing is closer to television advertising than search advertising, but that's a blog post in the future.