Earlier in the week I got that exact question from a new client who wanted the instant gratification and ROI of paid advertising, but wanted assurances that he wasn’t going to have Google on his payroll forever. Here is my response:
That's actually a good question Chris, and you aren't the first person to ask it. So yes, I actually have an answer.
The ideal scenario is that your Organic rankings will eventually displace your need for Pay-Per-Click (PPC). This does happen sometimes, but what usually happens is when we evaluate the ROI from the PPC to make that decision, we usually (not always) find that we are making way more on paid advertising than what we are spending. Usually our clients decide to maintain the PPC because it just doesn't make sense to stop it.
In other cases, we just make adjustments to the keywords and the budgets. This is something that we evaluate with our clients when the time is right.
Whether we do PPC as an initial strategy with the intention of phasing it out over time or not, we always gain valuable insight as to what our next move is. For example, since we can run and test many different keywords, ad-groups and landing pages simultaneously we can find out what works and what doesn’t so we can apply that intelligence to an organic search optimization program. Even if we only run it for a few months, we will invariably gain a lot of actionable data.
On a side note, doing PPC and Organic SEO simultaneously often results in a higher click-through-rate for organic. Part of that is just math; anytime you show up on a page, someone else gets displaced to the second page. Personally I think that is a minor factor. I think it has more to do with dominating the search results and the increase in branding.
Also, PPC allows you to direct traffic to specific landing pages. This is important when you want to ensure that someone winds up on specific product pages. You have considerably less control with organic.
After I wrote the email I decided I owed it to our client to do a little additional research. Here is one of the more concise articles on the subject from a fellow member of the MOZ: 8 Ways PPC and SEO Are Better When Used Together