This is quite a question and one that I believe depends on what market you are in and what you need to achieve from your website, if you have a long term view and you are time rich but cash poor then Search Engine Optimisation (SEO) is with out doubt the way to go, you will not see dramatic results over night but in a few months you can get significant extra traffic by ensuring your site is set up properly for the search engines to crawl through and index.

If however you have a good budget and need to see immediate results then Pay Per Click (PPC) may be the best way to go, it will send visitors to your site from day one and with the statistics packages available you will be able to see the ads that resulted in conversions and the ones that were ignored by visitors.

This brings us to another important down side of PPC and that is that Ad blindness is worse than ever Comscore, the marketing research company shows that 16% of Internet users are responsible for 85% of all ad clicks on the web, so the vast majority of visitors from your PPC ads may well have clicked before, this may not be a huge problem if the sales levels are good but it is a disturbing trend.

Asking if it is best to spend more on Pay Per Click (PPC) or Search Engine Optimisation (SEO) is a little like asking if you would like cake or ice cream, it normally depends on the circumstances at the time.

Pay Per Click is a great way of getting an instant boost for your company, getting the traffic in through the doors when the site is new so that you can test to see how popular the products or services you are selling are going to be, using relatively mall amounts of just a few hundred pounds you will be able to gage if people are interested in what you are promoting.

Once you know they are interested you can begin your marketing in full force, increasing your Pay Per Click budget and bringing in SEO for the site, Search Engine Optimisation is a longer term strategy than the PPC, but it does have the advantage of continuing to run even when you have stopped paying for it, although if it is stopped prematurely in a competitive market you can see the good positions drop quickly.

You are a little limited with the terms you can promote for with PPC as budget is always a concern, but with SEO you can promote for as many phrases as you like and you will find you are being found for phrases you did not even know were of interest to your visitors.

Rather than using PPC or SEO you should be using a combination of the two so that they complement each other as you move your marketing efforts forward, testing new markets with the PPC and promoting your site into the profitable niches using SEO.

So people are finally starting to accept that we are in a recession and as a result this has had an interesting effect on the Internet marketing community.  Many businesses look to cut their outgoings when times are tough but it would seem that this trend is changing as Google has announced a huge gain.  This means that many online retailers have been increasing their spending on Pay Per Click advertising as well as their search engine optimisation.  

This to me makes perfect sense, if the number of people looking to buy your product decreases then you should look to capture the majority of those people.  This can be easily done combining SEO with PPC.  The reason this works is because some search engine users like the sponsored PPC advertising while others prefer the organic listings.  Therefore if you are at the top of the organic SERPs and have a good PPC position then you are more likely to capture the people looking for the product and now you just have to convince them to buy.

The other side of the coin are the businesses that look to either decrease their PPC and SEO marketing budgets or to cut the work out completely.  This makes no sense to me as good SEO work will deliver potential customers straight to your door and if you can’t sell your product or service once they arrive at your site then the problem must lie elsewhere.  It could be that your site is suffering from a lack of usability, it could be the website design that is putting people off or your product, service or sales staff are not up to standard.

Either way some businesses may be able to ride out the storm by simply tightening the purse strings and making cuts but many will meet a sad and untimely end.  It is always the pro active businesses that make increases rather than making cuts that survive to become bigger and better companies while their competition get left behind.