Most people believe search engine marketing (SEM) and search engine optimisation (SEO) are one and the same thing. However, this is not the real truth and there are many differences between the two.

Search engine marketing or SEM refers to the short text advertisements that usually appear at the top or down the right hand side of search engine results. These are also known as "sponsored results" or "sponsored links" and are generally purchased from Google ™ (the Google AdWords ™product), or Yahoo! Search Marketing (YSM - formerly Overture) ™. In an attempt to identify the highest placed advertisements, advertisers bid in a continuing 24x7x365 auction.

In other words, SEM is generically referred to as "pay per click" (PPC) advertising as advertisers only pay when Internet visitors click on their advertising link and not when the advertisement is displayed. It is an effective form of paid advertising in search engines and is classified as text advertisements delivered in response to 'trigger' words, which are typed into the search box. When an Internet visitor types in a search phrase, the pay-per-click advertisements with bid on that phrase are displayed. If the visitor clicks on a text advertisement, he is taken to the website of the advertiser and the account of advertiser is charged for the click through by the advertising partner of the search engine.

Search engine optimisation (SEO), on the other hand, refers to the process of building website pages in such a manner that enables them to rank highly in 'algorithmically' determined results of search engines such as Google, Yahoo!, or MSN. It is worthwhile to note here that complex mathematical algorithms are used by search engines for evaluating the relevance of indexed pages for a specific search phrase. It is worth noting here that search engines index HTML (hypertext markup language) code and a good website that is expected to rank higher in search engine results should be designed with accessibility in mind before it can rank in a search engine. Search engine optimisation is actually a component and function of the process of search engine marketing. It is the comprehensive process of site optimisation for organic or natural search engine listings. SEO is undoubtedly the most cost-effective function in a SEM campaign, yet still just one element.

Last but not the least, the primary goal should always be to maximize the amount of relevant and qualified traffic to your website in relation to the marketing budget, whether it is search engine optimisation or search engine marketing you choose, and the rankings are secondary to the goal.