Most small businesses owners and marketers know a little something about SEO (search engine optimization) and the different tactics to help your website rank well in organic search engine results. Another important tactic for any Internet business to know about is SEM (search engine marketing), which includes things such as search engine optimization, paid listings and other search engine related services.
Keyword research tells you what topics people care about and, assuming you use the right SEO tool, how popular those topics actually are among your audience. The operative term here is topics -- by researching keywords that are getting a high volume of searches per month, you can identify and sort your content into topics that you want to create content on. Then, you can use these topics to dictate which keywords you look for and target.
Ever heard of Maslow's hierarchy of needs? It's a theory of psychology that prioritizes the most fundamental human needs (like air, water, and physical safety) over more advanced needs (like esteem and social belonging). The theory is that you can't achieve the needs at the top without ensuring the more fundamental needs are met first. Love doesn't matter if you don't have food.
Early versions of search algorithms relied on webmaster-provided information such as the keyword meta tag or index files in engines like ALIWEB. Meta tags provide a guide to each page's content. Using metadata to index pages was found to be less than reliable, however, because the webmaster's choice of keywords in the meta tag could potentially be an inaccurate representation of the site's actual content. Inaccurate, incomplete, and inconsistent data in meta tags could and did cause pages to rank for irrelevant searches.[dubious – discuss] Web content providers also manipulated some attributes within the HTML source of a page in an attempt to rank well in search engines. By 1997, search engine designers recognized that webmasters were making efforts to rank well in their search engine, and that some webmasters were even manipulating their rankings in search results by stuffing pages with excessive or irrelevant keywords. Early search engines, such as Altavista and Infoseek, adjusted their algorithms to prevent webmasters from manipulating rankings.
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The key distinction is that SEM is a broader strategy which combines paid search and SEO tactics. So, if you set up a PPC advertisement, but don't take steps to optimize the ad or the website it links to, this is a standard example of paid search. However, if you optimize your site and your search content with solid keywords, then you put money behind it to boost it on targeted audience's search pages, then you're dabbling in SEM.