Search engine marketing (SEM) is one of the most flexible, scalable, and cost-effective lead-generation tactics. In SEM, you place ads for your products or services in search results on search engines. When a potential customer searches for your types of products or services, your ad is placed in the ad spaces at the top of the list of results or in the margins to the side of the page along with other SEM ads.

SEM ads use search keywords or keyword phrases. As a marketer, you bid a PPC rate for each keyword you wish to use with your SEM ad. The higher your bid for a certain keyword, the higher your ad will be placed in search engine results when searchers use those keywords.

In planning your SEM campaign, you should divide your campaign into ad groups, that is, groups of multiple ads that run at the same time on the same search engine for the same products.

In choosing your keywords, you can bid for as many keywords or phrases as your budget will allow. Search engines have tools to help you choose specific keywords in relation to your SEM ad. In general, the more specific the keyword phrase is, the higher your SEM ad will rank in the results when potential customers search for that term, and the lower your PPC bid for that phrase will need to be.

In designing your SEM ad, be aware of the parameters that all ads on Google and Bing must follow. All ads must have a headline (up to 25 characters), two description lines (up to 35 characters each), a display URL, and a destination URL.

The search engines allow you to set a schedule for days and times when your SEM ads will run, and a daily or lifetime budget for how much you want to spend on the ad. If you have a location-specific ad, you can also do some limited geographic targeting.

The search engines give you a large amount of data about the performance of your SEM ad, including the number of clicks and impressions the ad received, your total cost for the ad, and the average ad position in search results. This data can be very useful in evaluating the success of your SEM ad campaign.

You have the ability to refine the schedule of your SEM ad so that the ad runs only on days and times when it gets the best response. This is called dayparting. You should run your ad 24/7 for the first week to determine the days and times it will get the most clicks and then adjust your schedule to take advantage of peak days and times.

You may not wish to bid for the first position in search results for your SEM ad. If you have a good SEM ad or a great offer, you may save money by bidding for the second or third position and still get a great result.

You can choose to have your SEM ads displayed on affiliate websites that have appropriate content for your products or services. However, you should treat SEM ad campaigns on affiliate websites as separate campaigns from your ad campaigns on search engines so you can provide separate bids, measure your results on each venue separately, and understand how well each campaign and venue work for you.