Read this excellent post on Search Marketing is Direct Marketing. It was written by Mike Moran, author of Search Engine Marketing Inc (a big read, but the best way to understand how search really works).
I think search marketing strikes a chord with smaller businesses in particular because it is so direct. Brand marketing is for those with deep pockets and deep faith.
The point Mike makes is that search marketing is even more measurable than direct marketing. So not only does it cost less, because it is so measurable you can tell – quickly – what is working and what isn’t.
I’ve launched a number of search campaigns for clients that have been very effective at driving traffic. And because we can (and do) measure conversions that result, its clear when its time to dial down the search traffic and focus on getting the traffic to convert.
How much harder to do that when you have to prepare brochures, print them, mail them and measure.