I used
SEO alone for my first 10 months in Affiliate Marketing. I made a decision that when I started I was going to spend as little money as possible (as with a new family I didn't have much to spare

), so I relied solely on
SEO.
It was hard going at first, but encouraged me to make my sites as optimised as I can, and to learn as much as possible about the way google works (and in real life its nothing like the
SEO tutorials you read online lol). I think it helped me a lot, as it made me focus a lot more on creating good websites, with good content, and I ended up with about 90% of my domains at number 1 for their keywords.
It was a steep learning curve, and for the first 6 months I made nothing, but I kept at it and one I worked out a format that works sales wise, and the best way to get results in Google, the money started coming in.
I then used the money to start a PPC campaign, small at first, but have built it up and its doing very well, getting a minimum return of 8 x what I spend on a daily basis, and recently much more. I`ve used the same strategy for my landing pages as per my sites, and so the conversion rate is excellent. Get around 25% CTR for my google ad's, and then between a 60 - 70% conversion rate from the landing page.
I think starting off with PPC can make you lazy, its easy to earn a bit of money with PPC, and a lot of people stick to that when in reality they can be earning a lot more.
I think that starting off with no budget, and literally making money from nothing (apart from domain / hosting costs), gives you a good grounding which you can then build on with PPC to end up getting the best results.
Im sure there are people who don't agree, but for me I think it was the right way to go. I don't think of making nothing for the first 6 months as a waste of time, as I actually learnt a hell of a lot from it. The hardest thing though is not to give up! It is encouraging when it starts working out though, as if you can make money from nothing, then with some sensible spending you can go so much further. It also means that I don't waste money on PPC, and squeeze every penny I can out of my minimal spend
Even though I use PPC now as well, its not a replacement for
SEO, the two work together, and I still put my best into optimising my sites for
SEO. When you have a site at number 1 in the serps, and a good adwords position, you can cream off a large amount of traffic (especially in the niche markets I operate in).