SEO vs Media Buying: what is best for startups?

Which is better for a startup to focus on if you have to put all your resources into one basket?

Pretty much every startup focuses exclusively on SEO efforts (which take a long time to get results, if at all).

Media buys on the hand is a straight up math. Spent a $1 and try to make more than $1.

Which one should startups focus on if they had to pick one (as for many of us, time and resources are limited).

SEO done well is also "straight up math". Keyphrase X gets 1500 monthly searches. #1 spot would yield ~500 click-throughs. Y% convert.

Startups & digital businesses in general pursue SEO because it's intent-based traffic, whereas media buys generate attention-based traffic. If you can match search intent and earn a high spot in the rankings, you are offering them what they are asking for, and your conversion rate is much higher as a result.

With media buys, you're fighting to catch the attention of a relevant audience first, and then hoping that they also have an interest in what you're offering, and as a result your click-through rates and conversion rates are both much lower.

Now, startups in their early days are almost always looking for footholds wherever they can get them, so I wouldn't totally proscribe media buys, if you can find a buy that gives you a highly-relevant audience, and if you can create your ad to be as budget-efficient as possible. (See my answer for 'Strategies for media buying?')

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Another point worth making is that what you see as 'all startups focusing on SEO' may actually be startups focusing on creating content, which has many uses outside of SEO. Content is how you can provide value to people before they've tried your product, or who aren't the right fit for using it but have an audience of people who are. Content is used in social marketing, in generating press, in building your sales funnel, in developing industry relationships, and in SEO.

Jay makes a great point about SEO being more intent-driven whereas media buying is interest-driven.

Your traffic acquisition strategy will depend on what kind of product and audience you're going after.

Here is how I have approached a few markets and my results:

1. Content sites

Unless I have a high margin product or monetization per user, I rule out media buys right away and focus exclusively on SEO via content marketing.

If a content site is just monetizing with ads for other people's products, the funnel the users have to go through is too long for a profitable media buy.

Most people are landing on your site to consume content, so the percentage that will convert for a third party's offer will be low.

Preferred channel: SEO

2. SaaS products

SaaS is a little bit trickier. Trust plays a bigger role. And in order to gain trust of prospective customers, you have to draw them in by giving something of value first. Content marketing is great at that.

Churning out high quality content that provides value to your target audience is the low hanging fruit.

Preferred channel: Start with SEO (via content marketing) and scale with media buys once you have cash flow.

3. Affiliate offers

If you're promoting affiliate offers for someone else (be it via direct linking or a landing page funnel), media buys is the first option I explore.

I've had success creating campaigns (both direct linking and to our network of coupon sites) via RTB platforms like SiteScout.

We would spend about $100 per offer to test out all the variables (creatives, landing pages, conversion at the merchant's side, etc). And then scale campaigns and optimize ones that were either break even or profitable.

SEO also played a big role later on (it ended up accounting for over 60% of our revenues), but the starting point was media buys. The main reason was because the competition in SEO was cut-throat for our niche.

Preferred channel: Start with media buys, work on SEO for long term gains.

4. Your own product: informational (ebooks) or physical

One of my top performing affiliate campaigns were for nootropics and vitamin products. Realizing that we were getting less than 20% of the profit while taking on all the risk, it was a no-brainer to create our own products.

Doing so turned out to be easier than expected. For the nootropics niche, I had the domain expertise to come up with a formula and get it tested by a lab, and then got a local supplier to create the product.

Making media buys profitable became way, way, WAY easier. With complete control of the product, I could optimize the entire customer funnel and even make more revenue from a post-customer cycle (promote relevant products and offers to converted customers).

Preferred channel: Start with media buys, execute SEO for long term gains.