Paid Search Advertising

Abstract

The rise of the Internet – and with it the rise of Internet sear ch engines such as Google, Yahoo! and Bing – has revolutionized the way information can be accessed by consumers. In the wake of this seismic shift in information search comes a new tool that allows marketers to intercept and target consumers during their search process – sear ch engine marketing (SEM). SEM breaks down into two key parts, search engine optimization (SEO) and paid search advertising (paid search). The goal of SEO is to optimize a firm’s position in the so-called organic listings provided by search engines, that is, the sear ch results based on the algorithms search engines use. On the other hand, paid search allows firms to buy a placement in the so-called sponsored or paid listings of the search engine results page (SERP). The purpose of this chapter is to discuss how paid sear ch functions as an advertising vehicle and to show how firms can use data and analysis to better leverage their spending on it.