It's well known that it takes some time and considerable skill to get search engine position for organic (i.e., "free") search, while pay per click search puts you on the results page as soon as you start paying.  A conventional approach is to start a paid campaign at the same time as an organic campaign, with the idea that once organic search is well established the spend on the paid campaign can be reduced or eliminated.  Others might simply ignore paid search and insist on using only organic search; it takes time for them to see results, but those results are all free.  I've also seen site owners focus so much on paid search that they ignored the significant business they can obtain from organic search.  What's the best approach?

New Studies Shed Light on This Question

One particularly relevant study at the Stern School of Business of NYU dealt with the relationship between organic search results and paid search results.  They discovered that significantly better clickthrough results are obtained when the search engine result appears both in paid search and organic search.  The effect is less important for very broad search terms and is more important for terms that are highly site-specific.  In fact, the study showed that using the combination of approaches would increase the profits of the advertiser compared with using just one approach.

My own experience indicates that site-specific terms, often those with two or three words, are often associated with high average time on site for visitors, and hence high conversion rates.  This study shows that the approach of seeking paid and organic search results from the outset of a Web marketing campaign is appropriate, but the option of dropping the paid campaign when organic search starts to work is not the best approach.

The Bottom Line 

While your site is in development, starting developing the organic search campaign, so that you start toward achieving those results from the outset.  At the time the site is launched, start your pay per click campaign also, with the idea that it will bring you visitors right away, before you have results for organic search, and then when you are successful with organic search the pay per click results will complement their effectiveness.  With both campaigns, focus on site-specific terms at first, and include more general terms as you learn of their effectiveness in your campaigns.