SEO ROI (Return on Investment)

What is SEO ROI? It's Search Engine Optimization Return On Investment. Ideally, the benefit of the SEO service should outweigh the cost. Here are some thoughts about calculating the cost.

SEO ROI Balancing Cost and Gain

Simple SEO ROI Formula:

  • Change in # of visitors X Conversion Rate X Average Sale = Revenue
  • Revenue from SEO efforts - Cost of SEO= Profit
  • Profit / Cost of SEO = ROI

Let's look at an example of this formula with some average numbers.

Example (One year):

Let's say the SEO campaign moved your site from little traffic to 1,500 website visitors in one year for an SEO retainer fee of $1,500 per month:

  • 1,500 in traffic per month x 2% Conversion = 30 sales per month X $250 per sale = $7,500 Revenue per month, or $90,000 per year.
  • $90,000 in revenue - SEO retainer ($1,500 X 12 = $18,000) = $72,000 profit.
  • $72,000 in profit / $18,000 is SEO costs = 400% ROI

The math seems like an easy solution for a business, but some SEO factors need to be addressed.

I will explain a few things to help determine if Search Engine Optimization makes sense as a business investment. If you are already engaged in an SEO campaign and need to validate results, this should help.

The Fundamentals of SEO

The "Why" of SEO:

Search Engine Optimization is about making your website appealing to consumers and search engines alike. SEO is the intentional effort to improve this relationship and make your site ready to be indexed and used. People are searching the web, and you want your site to be on the Search Results page, seen by potential buyers at the right time. Implement processes that make this work.

The Investment in SEO (In addition to cost)

There are some factors, beyond cost, to consider when looking at engaging an SEO campaign:

  1. It takes time. SEO is a long-game strategy. It takes a lot of planning, executing several facets correctly, and data to ensure positive results. Generally, it takes a month to make initial changes and have initial research done,  then 2-4 months of continuous improvement to create, implement and refine content, build backlinks, etc. The time it takes to see the start and begin SEO means you can expect to see results in 4 -12 months, depending on the competitiveness of your industry,
  2. There is a minimum viable investment of time and resources. I break down what goes into the cost of SEO services below. See the section "Minimum Investment in SEO."
  3. It takes continuous improvement. The nature of the web changes every day. An SEO strategy should include monitoring, reporting, and a content strategy plan in action, with constant improvements to the website.

The Minimum Investment in SEO: 

  1. Track website traffic. (Analytics and Search Console)
  2. Track website conversions and know the average sale price.
  3. Fix code errors on your site. (Technical SEO)
  4. Use keywords that people are using for searches. (Keyword Research)
  5. Use keywords that convert visitors to clients. (Industry Insight)
  6. Associate with better-related sites. (Backlinking and Signaling)
  7. Know what your digital competitors are doing and the competitiveness of your site. (Competitor Tracking)

Processes to Implement:

  1. Install Analytics and verify your website in Search Console.
  2. Create methods to track conversions and get an average price per sale.
  3. A website may need to be updated/changed/improved. With SEO in mind, the range of changes goes from minor edits to a complete rebuild. I've yet to see a site that did not need some work.
  4. Research keywords from a variety of sources. Fortunately, Google gives us insight into how often certain words are used in a search in a month. But it would be best to look for variations of words to find higher searched words.
  5. Leverage industry knowledge* to identify conversion words, ideally action words and phrases, and use those on the site. (Example "Hiring a House Painter" vs. "House Painting") It may require rewriting or editing existing content.
  6. You need to get more quality backlinks to your site and have some positive signaling from other sites. (Ex: Social Media posts that direct people to your site may be shared and reposted). Outreach to website owners, industry partners, and social media efforts is vital.
  7. Measure against competitors and watch for people using the words you want to rank well.

*an SEO may not have this knowledge and needs client feedback.

The Business Case for SEO

If you want to engage in SEO, you need to consider the following:

  1. Can you invest in a process with a longer time commitment?
  2. Can you make the initial time/resource investment to engage SEO?
  3. What does success look like for your SEO campaign?
  4. At what point do you need to reconsider the investment?
  5. Who will make the necessary changes?

However, this is not the only consideration. There are some other benefits of an SEO campaign.

Other Benefits of SEO efforts

  1. An SEO campaign should feed a Content Creation Strategy and enhance other marketing efforts.
  2. An SEO campaign should include code fixes that improve user experience.
  3. An SEO campaign should improve your connectivity to others in your industry.
  4. An SEO campaign should enhance other digital efforts. (Consider the number of touches to convert a potential client.) They may see a social media post, then a Google Ad, eventually look up something organically, and click through to your website.
  5. An SEO campaign should provide data that business owners can use in other parts of the business. (A Competitor analysis can show you other markets or product offerings that are viable).

I hope this is helpful for you. If you have any questions, please feel free to contact me.

 

Leave a Reply