Paid Search Marketing vs. Search Engine Optimization: Analytical Models of Search Marketing Based on Search Engine Quality
Authors: Li, Kai; Shen, Chunyang; Lin, Mei; Lin, Zhangxi
Journal: Journal of the Association for Information Systems (2026)
DOI: 10.17705/1jais.00961
<jats:p>As search engines are leading revenue growth in online marketing, search marketing has become a popular area of academic research. Although search engine advertising has interested researchers for decades and much has been learned, one thing that puzzles scholars is why search engine optimization companies are tolerated rather than excluded from the market, even though they capture a significant share of the advertising market. In this paper, we shed light on this phenomenon and establish an analytical model based on organic search quality. Through analysis of the model, we were able to draw several intriguing conclusions. First, there is no strictly positive correlation between advertisers’ willingness to pay and the click price of paid search marketing. In other words, the click price may decrease as advertisers’ willingness to pay increases. Secondly, improving the effectiveness of a search engine has the potential to attract more searchers, but it may also result in a decline in the search engine’s profits. Finally, a search engine may achieve higher profits by allowing search engine optimization firms to remain in the market rather than driving them out. We discuss ou…