What Is Search Engine Marketing (SEM)? [Explained]

Kelly Lyons

Sep 26, 202214 min read
Search engine marketing


What Is SEM?

Search engine marketing (SEM) refers to the practice of promoting websites by increasing their visibility in search engine results pages (SERPs) primarily through paid advertising, but it can also include SEO.

With paid advertising, your website ranks in paid results. Whereas with SEO, it ranks in organic results.

Like this:

paid ads and organic results on the SERP

In this article, we’ll cover:

  • How search engine marketing works
  • How ad auctions work
  • SEM best practices 

Let’s get started.


SEM is a digital marketing strategy used to increase your site's visibility in search results. This can include both paid and organic (SEO) efforts.

While SEM broadly covers more than just paid marketing, it’s often also referred to as pay-per-click (PPC) marketing. This is a business model where marketers pay each time someone clicks their ad.

SEO, on the other hand, refers to organic results—i.e., “free” traffic as a result of providing relevant, useful content that ranks well on Google.

An effective SEO strategy can help you earn long-term traffic, while search engine ads can help improve your visibility and earn clicks from people ready to buy your product.

While SEM is a nuanced term, we’ll focus on using it to reference a paid search strategy from here on out.

How Does Search Engine Marketing Work?

SEM can be a powerful way to reach new customers and drive revenue because it ranks your site above organic results on the SERP.

Just look at the SERP for “meditation apps.” Headspace ranks first organically, but also holds the top Google ad spot:

paid and organic results for "meditation apps"

You may be wondering why they’re bidding on the keyword if they already rank organically.

The reason is simple: they take up more real estate on the SERP this way. And even if their organic rankings fluctuate, they still have a chance to appear at the top of the page.

It’s especially important to hook users from the top of the SERP if they’re ready to buy. Otherwise, they may choose the easiest, most visible option (which may be your competitor’s ad).

But for your site to appear at the top of the SERP, you’ll need to win an ad auction. 

To secure coveted paid ad spots at the top of the SERP, advertisers bid on keywords. Whoever wins the auction gets the top spot.

For our purposes, let’s cover how bids work in Google Ads.

To enter an ad auction, you’ll need to identify two important things:

  1. The keywords you want to bid on
  2. How much you’re willing to spend per click for each keyword

To identify the right keywords to bid on, use Semrush’s Keyword Magic Tool.

Open the tool, enter a word or phrase that’s relevant to your business, and hit “search.”

search for "insurance" in Keyword Magic Tool

You’ll see potential keyword ideas for your PPC campaigns. Not all of these will make sense targeting with your ads.

results for "insurance" search in Keyword Magic Tool

Generally, you’ll need to choose the ones that are likely to convert. We cover how to make smart keyword choices later in this guide.

Now, in terms of how much you’re willing to spend per click for each keyword, the right price will depend on your industry.

For example, the average CPC for insurance and legal is higher than less competitive niches like home and garden.

Learn more about some of the expensive industries here.

Once Google determines that the keywords you bid on appear in users’ search queries, your ads will be entered into the auction.

Ads will only appear on searches with enough commercial intent (i.e., users are ready to buy). Like the ad for Headspace above—people are ready to buy a subscription. 

Whereas informational searches like “what is copywriting” only display organic results:

Google SERP for “what is copywriting”

There are also several factors that influence whether or not your ad will win the bidding, even if it’s a good fit for the keyword.

Here’s how Google decides which ad will win.

According to Google Ads guidelines, there are five main factors that they consider during an ad auction:

  1. Maximum bid: The maximum amount you're willing to pay for a click on your ad 
  2. Quality Score: The formula that Google Ads uses to determine the relevance of your ad, or how useful it will be for the user
  3. Impact of ad extensions: The additional information you provided in your ad (phone number, links to specific pages, etc.) 
  4. Ad rank: Ad rank is a combination of your bid and the quality of your ad and landing page. Google requires ads to meet a minimum quality threshold in order to be shown in a higher position.
  5. Ad context: When calculating ad rank, Google takes context into account. This includes the search term used, the user’s location, the time of search, the device used, and more.

Pro tip: You can monitor—and work to improve—your Quality Score in your Google Ads account.

The maximum bid refers to Google’s automated bidding strategies, which you have full control over. The same is true for ad extensions that might impact your ad performance.

The Quality Score, however, is a number between 1-10 assigned to you by Google. And it’s the reason why your ad only wins auctions for relevant queries.

5 main factors of Google ad auctions

The Quality Score is the gatekeeper of PPC advertising—it ensures that the ads users see are helpful and relevant.

If your ad matches too many irrelevant or generic queries, the costs of your paid search will rise exponentially.

This can damage your return on investment (ROI), and likely won’t yield the results you hoped for.

SEM Best Practices & Helpful Tips

To craft a successful ad campaign, you’ll need to structure your campaign correctly, choose the right keywords, write solid ad copy, and analyze competitors’ ads.

Here’s how to get started:

Set Up Google Ads Account & Campaign Structure

Follow these steps from Google to set up your Ads account. But don’t just jump into your first campaign.

Make the most out of your paid search budget by structuring your campaigns strategically. Here are the four parts of an ad that you need to familiarize yourself with:

  • Campaign: Set of ad groups that share a budget, target location, and other settings
  • Ad group: Sets of keywords divided by theme
  • Keyword: Terms you are bidding on
  • Ad: Copy that users will see when your ad is triggered

Set up your ad groups so that they target specific keyword clusters that will resonate with your audience. Bidding on keywords randomly will waste a lot of your budget. 

Here’s what a well-structured Google Ads account looks like:

Google Ads account structure example

The ads are grouped together topically to ensure strategic bids.

To learn how to find relevant keywords, read on.

Choose the Right Keywords

Good keyword research is the first step to a successful search engine marketing campaign because it allows you to target the right audience.

And getting your links in front of the right audience—i.e., people who are ready to buy—means more clicks and purchases.

The “right” keywords for your campaign depend on many factors, including search intent, volume, competition, and cost per click.

If you’re starting paid keyword research from scratch, head over to our Keyword Magic Tool.

looking up "summer dress" in the Keyword Magic Tool

Enter a keyword that’s relevant to your business and scroll through the results to start brainstorming ad groups.

Take advantage of the filters available and choose keywords to exclude (this is an easy way to add negative keywords, which we’ll cover later).

Keyword Magic Tool filters

Here are the main things to consider when picking which keywords to target:

Target Keywords with Commercial & Transactional Intent

Google’s algorithm takes search intent and wording into account and serves the results it thinks are the best matches.

Search intent has four main categories:

  • Navigational (looking for something specific)
  • Informational (learning about a topic)
  • Commercial (investigating products, services, or brands)
  • Transactional (intending to make a purchase)

Here are some examples in action:

search intent categories and definitions

Those looking for commercial or transactional keywords are more likely to make a purchase by the end of their search. So it’s best to focus on these types of keywords for your ads.

Many Semrush tools show the search intent behind keywords, including the Keyword Magic Tool:

finding Search Intent in Semrush

Review Keyword Volume & Competition

Aim for a mixture of broader, more competitive keywords as well as less competitive keywords that are highly specific to your audience.

It’s a balancing act—you want your brand to show up for competitive keywords and also attract qualified leads.

If you see a keyword you’re interested in, first check the Volume column:

keyword volume

There’s no perfect search volume because it varies by industry. So do preliminary research to see how expensive keywords are in your niche.

If you’re happy with the keyword volume, check the Competitive Density. This refers to the level of competition between advertisers bidding on a particular keyword.

Competitive Density is shown on a scale between 0.00 to 1.00, with 1.00 being the most competitive.

It can be found here:

Competitive Density definition

Once you find keywords with acceptable volume and competition, consider their cost per click—i.e., how much you need to bid to win the auction.

Look at Cost Per Click

In a Google Ads auction, the ad with the best Quality Score and the highest bid will win the ad placement.

This means that competitive keywords are more expensive.

It can be worthwhile to go after competitive keywords if you have the budget but do your research first to get an idea of what the CPC will be.

You can use the Keyword Magic Tool or do so directly in Google Ads.

Once you find your keyword in the Keyword Magic Tool, check the “CPC” column:

CPC in the Keyword Magic Tool

If you plan to bid on a more competitive keyword, make sure not to bid too low or your ad may not get picked.

This is generally true for all keywords, but you can get away with bidding less on niche keywords with lower competition.

Add Negative Keywords & Remove Duplicate Keywords

Once you choose which keywords you plan to bid on, there are two things you can do to make sure your ads show up in front of the right audience: add negative keywords and remove duplicate keywords.

Add Negative Keywords

Add negative keywords to a campaign or ad group to prevent your ad from showing up on irrelevant results pages.

Let’s say you chose “free” as a negative keyword. Your ad won’t be shown if someone includes “free” in their search.

Here’s an illustration of how negative keywords work:

negative keyword examples

A great place to start your negative keyword list is by looking for informational and navigational keywords in the Keyword Magic Tool, then moving them to your PPC Keyword Tool

Start by entering your target keyword into the Keyword Magic Tool’s search bar.

searching "coffee" in the Keyword Magic Tool

Then, filter out keywords by informational and navigational intent.

filtering by keyword intent

Now you’ve got a list of potential negative keywords. Go through the list and click the checkbox beside keywords you don’t want to target with ads.

selecting keywords

Export your list.

export keywords

Once you have a list of keywords, head over to the PPC Keyword Tool. Either create a new project or select an existing one.

PPC Keyword Tool projects

Then, go to your negative keywords tab.

PPC Keyword Tool negatives

Click on the “+ Negatives” button and select “manually.”

manually export keywords

Paste your selected keywords into the field provided. Then hit “Add.”

adding negative keywords manually

When you’re done adding keywords, hit the “Add keywords” button at the bottom of the window.

add keywords button

Finally, export your list so that you can upload it to your Google Ads campaign.

export data in PPC Keyword Tool

Remove Duplicate Keywords

You only need to include a keyword once in each ad group. Otherwise, you’ll be bidding on the same keyword more than once.

So if two or more ad groups contain the same keyword, the ad with the highest Quality Score will show. In short, you’d be competing with yourself.

Once again, either create a new project or select an existing project.

PPC Keyword Tool projects

From your project dashboard, hit the “Remove duplicates” button.

remove duplicates

A window will pop up, showing you duplicate keywords.

list of keywords

Select the duplicate keywords you want to remove and hit “Remove selected.”

remove selected button

You can also use the tool to simply identify duplicate keywords and remove them directly from your Google Ads account.

Write Compelling Ad Copy for SEM

Now that you have all the building blocks to create a successful SEM campaign, let’s dive into the last part: writing your ad.

Each paid ad is made up of four components: a headline, a display URL, a description, and ad extensions.

parts of an ad

Let’s cover best practices for each component of a search ad, as well as the final result: the landing page the ad links to.

Optimize Your Headline

The headline is the most prominent part of your ad, so be clear and specific about what your business does and what products or offerings you have. 

You can choose three headlines per ad—30 characters each. 

A good headline should:

  • Include simple, direct language
  • Use keywords naturally
  • Address user intent
  • Appeal to emotion or use humor (if it fits your branding)

An easy way to do this? Use a tool like the AI Ad Copy Generator

It uses machine learning built on billions of ads to help you create the most persuasive ad copy for your campaigns. 

First, add the URL of the page you want to run ads for. And click “Continue.” 

"Provide URL" tab in setting up AI Ad Copy Generator

Then, add information about your product or service. Plus the keywords you’re targeting. 

"Ad Builder" tab in setting up AI Ad Copy Generator

Once the headlines are ready, you’ll get an email with a CSV file containing multiple headlines, descriptions, and call-out texts. 

Like this:

An example of a headline and its description from the CVS file

The tool costs just $20 per month. And you can try it for free!

Choose a Display URL

Your display URL is the web address that appears on your ad. However, the landing page URL may be more specific.

Let’s say your shortened display URL is sneakers.com

When a user clicks on the ad, the landing page URL (or final URL) might be something more specific like sneakers.com/running-shoes

The final URL should be the most relevant page on your site based on what the user searched for. The display URL is more of a teaser.

Here’s how to choose an effective display URL:

  • Help users anticipate what kind of page they will land on
  • Clearly show your brand name or what you sell
  • Keep it short and simple

Write Click-worthy Descriptions

Write two lines that entice users to click. These might be what your business offers, why customers should visit your website, or any other pertinent information about your business.

Each description line can be up to 90 characters.

Here are a few tips for writing solid ad descriptions:

  • Strategically place keywords so users can tell your ad matches their needs
  • Keep your messaging concise and to the point so users don’t lose interest
  • Always include a call to action to entice clicks (“shop now,” “place your order,” “book now,” etc.)

And here are some examples of descriptions you could use for our imaginary sneaker site:

  • Shop our Semi-Annual Sale to get discounts on our most popular styles.
  • More than 100 styles to choose from, plus free shipping and returns on every order.
  • Choose our Custom Sneakers to personalize the color and style of your kicks.

Include Ad Extensions

Use ad extensions to include additional information that may influence users to click.

A few examples of ad extensions are: call buttons, location information, links to specific parts of your site, additional text, and more.

ad extensions

Ads typically perform better when ad extensions are present. However, they won’t always show up as they are influenced by a few factors:

  • Ad rank: Site extensions appear when a minimum ad rank is met. Increase your bid and ad quality (or both) if your ad extensions aren’t showing.
  • Position of your ad: There’s only so much room on the SERP for ads, so ads ranked higher take priority. Ads in lower positions usually won’t have as many extensions visible.
  • Other extensions you’ve enabled: When you enter an auction, Google will identify the best possible combination of eligible ad extensions and formats. According to Google, “You will not be able to get a combination of extensions which gives more expected click-through-rate (CTR) than the expected CTR of a higher ad position.”

Read Google’s full list of ad extensions to learn more about specific types.

Create a Corresponding Landing Page

The landing page is where your users will go when they click your ad. The actual URL of this page is typically the same as your final URL.

According to Google’s policy, your landing page and display URL (the one shown in your ad) must share a domain.

Keep in mind that landing page experience is one of many factors that make up the Quality Score of a keyword.

Here are a few things that determine the overall experience of your landing page:

  • Useful, relevant information
  • Easy navigation
  • Number of links on the page
  • User expectations (i.e., does the landing page match user expectations based on ad copy?)

Be sure to regularly check your campaign structure and ad grouping, as well as the copy of your ad, to ensure you aren’t wasting budget there either.

And lastly, keep experimenting to ensure you’re getting the best ROI for your efforts.

Analyze Competitors’ Ads

When experimenting with your own ads, it’s a good idea to review your competitors’ ad copies and strategies. This allows you to review where they’re succeeding and how to replicate it.

Start by navigating to the search engine marketing analysis tool like Semrush’s Advertising Research:

Advertising Research tool

Go to the Ad Copies report.

Ad Copies report

You’ll see a full list of ad copies from your competitor.

Ad Copies report results

Use the search bar to filter by product title or use the advanced filters to search by description or URL.

filtering by product in Ad Copies report

If you click on the arrow below each ad copy box, you’ll get a list of specific keywords the ad is ranking for:

arrow drop downs for keywords

Aren’t sure who you’re competing with exactly?

You can also plug your own site into the tool and head to the “Competitors” report:

Advertising Research competitors report

Here, you’ll find a Competitive Positioning Map highlighting your paid traffic competitors:

Advertising Research Competitive Positioning Map

Learn More About SEM

Now that you know the basics of SEM marketing, it’s time to dive a bit deeper.

Here are a few articles and checklists to get you started with marketing on search engines and master search marketing:

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Writer, editor, SEO strategist, and supporter of the Oxford comma. There‘s little I enjoy more than lounging on my couch playing video games and snuggling with my dog.
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