Subdomains are an extension of the main domain. They create separate sections of a website. With addon domains, you can use the same hosting account to host a whole other website.
Subdomain: blog.example.com. The "blog" is a subdomain of "example.com." Addon Domain: "anotherdomain.com" hosted alongside "example.com" on the same server.
Subdomains are treated as separate entities by search engines, affecting SEO differently. Addon domains are considered completely independent, with separate SEO considerations.
Subdomains: Ideal for blogs, stores, or sections requiring a different CMS or theme from the main site. Addon Domains: Perfect for managing multiple websites without purchasing additional hosting accounts.
Use subdomains for related content, and addon domains for completely different websites.