We have a limitted budget of about $1,000 and we are trying to decide if we spend it on an SEO or pay for advertising. Which is the best use of our money?

That is a difficult question because if you find a great SEO and have a niche product you will not have to advertise. But finding such a niche is getting more and more difficult because other people have the same idea. The other challenge is finding a good SEO which is difficult. On the other hand spending $1000 on a niche product could prove very profitable if the keyword cost is not that high.

I would use it in advertising you will only get one time support for seo work and with advertising at least you can bring in revenue now and then reivest in the business with the revenue and if you make enough it may make sense to hire a SEO

I differ a little from the other responses I think you ought to split the investment and spend $500 for SEO work and $500 for advertising. If the SEO does a good job, you may get some traffic in 3/4 months time in the meantime you can use advertising.

The best thing you can do is buy a keyword program like keyword elite which will allow you to find the keywords that you need both for the SEO work as well as the PPC work.

I would say SEO if you're looking for long-term results. Good SEO will last - an ad campaign is finite unless you have a mega-budget.

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Thanks for all your comments but there does not appear to be a consensus