If you are going to do this by yourself, then it's definitely cheaper. Yet you have to be very familiar with the process in order to benefit from this method. But, if you intend on hiring someone to do the SEO work for you, then I would have to say that Adwords would be cheaper if this is the case since hiring someone means you have to pay for their service. And as far as I know, their rates nowadays are quite expensive...What has been your experience? Is SEO really FREE and cheaper than Adwords or other advertising methods?
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