The Ultimate Guide To Search Engine Marketing (SEM)

Updated June 24, 2022

Online marketing is a valuable tool for businesses looking to extend their brand's consumer reach. Search engine marketing is a strategy that can help businesses acquire new customers. Search engine marketing requires some strategy to be most effective.

In this article, we will explain search engine marketing and how it works, what keyword research means, the important aspects of account structure, what a search engine marketing ad auction entails and what quality scores mean.

Related: Creating a Successful Social Media Marketing Strategy

What is SEM?

Search engine marketing, or SEM, is the use of paid ads on search engine result pages, or SERPs, to gain new customers. Most search engines use some form of SEM. SEM is also known as paid search ads, paid advertising and pay-per-click, or PPC.

While SEM overlaps with other online marketing strategies like search engine optimization or social media marketing, SEMs primary difference is that it is paid advertising.

SEM offers participants many benefits:

  • Instant brand awareness: Consumers will see your company's ad on the first SERP.

  • Quick revenue generation: If your ad is effective, you may see immediate revenue. There is no lag time between placement and purchase.

  • Sustainable growth: You control how large or small your SEM campaign is. It is easy to scale up or down depending on your business's needs.

  • Targets the right consumer: Ads are selected based on keywords. You know that the consumer is interested in your product or service because they searched for it.

  • Reinforces name recognition: SEM works well with other online marketing strategies like search engine optimization (SEO) and social media marketing. The more times a customer sees your brand, the more likely they are to purchase from you. SEM is another avenue through which to grow brand awareness.

  • Competitive advantage: Paid ads appear above organic SEO ads. Even if your competitors have excellent SEO, your ad will appear above theirs with SEM.

  • Cost-effective: With a strong ad and landing page, SEM can be a low-cost marketing strategy.

How does SEM work?

SEM works by populating paid ads at the top of SERPs related to keywords entered into the search engine by the consumer. SEM ads only appear when a consumer has searched for keywords set to trigger that ad.

Companies manage their SEM ads through a search engine's SEM site. For most search engines, this involves creating an account through which all ads can be managed as well as participating in ad auctions to guarantee your ads are populating searches. If your company wins the bid for the keyword, then your ad will be displayed on the first SERP no matter what.

Related: Complete Guide to Digital Marketing

What is SEM keyword research?

It is important to research keywords related to your ad campaign to maximize your company's revenue opportunities. Keywords are words or phrases consumers use in search engines to find products, services and information.

When researching keywords, consider positive and negative alignment to your ad or ads. Positive alignment is words that are directly associated with your product or service. For example, if your company produces sporting goods, you will want keywords like sports equipment, basketballs, soccer nets and tennis racquets to trigger your ads. However, you do not want words like basketball games, soccer practice or tennis lessons associated with your ads if you do not offer those goods or services.

Important parts of account structure

Managing your SEM ads through a search engine requires creating an account. Account structure may differ slightly from search engine to search engine, but the following structure is most common.


The account is where all of the following components can be found. You will have a single account for your business through which you can run multiple campaigns.


You can choose the type of ad campaign you want to run through SEM. There are multiple options like a search campaign, a call-only campaign and display campaigns. Each of these campaigns will align with a different business goal. You can have several campaigns within your account.

Ad groups

Ad groups give structure to your campaign. Within the ad group, you will organize keywords and ads by a general theme or connecting idea. You might have six to ten ad groups per campaign.


Keywords are the words searched by consumers that will trigger your ad. It is important to research the highest yield keywords related to your product or service and apply those to your ads. Generally, there are around 20 keywords per ad group.


Ads are the actual copy that will populate on the SERP when a consumer triggers your ad. Run tests between various ads to see which gets the best response. You are paying to have these ads presented to interested consumers, so make sure that they are effective. Include two or three ads per ad group.

Related: 3 Benefits of Using Paid Search in Your Digital Marketing Strategy

What is an SEM ad auction?

Businesses bid on keywords for their SEM ads to appear at the top of the first SERP. Companies provide the search engine with the maximum amount they are willing to pay for a keyword, the copy for the SEM ad and the landing page the consumer will go to if they click. The search engine takes this information and compares it to other companies' bidding information. The company with not only the highest bid but also the best quality ad and landing page and the ad with the highest anticipated impact will win the bid.

These auctions happen instantaneously every time a consumer runs a search. A company's success in the auction process impacts its quality score and the amount of money it costs the company to place SEM ads.

Related: SEO vs. SEM: When and How To Use Them

What is SEM quality score?

A quality score is a search engine's rating of your company determined through several factors.

  • Click-through rate: The click-through rate is the number of times a consumer clicks on your ad after seeing it.

  • Keyword value: The keyword value determines whether or not the keywords you associate with your ad are effective. This is determined with the assistance of the click-through rate.

  • Quality of the landing page: Search engines want to provide great products to their users. The landing page for your company's ad must demonstrate high quality to entice users to return.

  • Ad copy: The ad copy needs to relate directly to the search query.

Your quality score determines how much your company pays for SEM ads. Businesses with high-quality scores pay less than businesses with low-quality scores.


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