Consider your competition. Look at what your competitors are doing and how they are performing in their search marketing before you decide how you can best compete with them. Research what search terms they rank organically for. Consider if you can execute a plan to top their SERP placements. Also, look at what paid terms they are using to drive traffic to their own sites. As you perform this research, look for gaps that you can fill and areas where you will be unable to compete in both paid and organic search.
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.
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