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 nominal 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

This seems like an easy solution for a business, but there are some factors of SEO that need to be addressed.

I'm going to breakdown a few things to help you figure out 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, you want your site to be found by potential buyers at the right time. Implement processes that make this work.

The Investment of 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 on several facets the right way, 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. This 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 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, a content strategy plan in action, with continuous improvements to the website.

The Minimum Investment in SEO: 

  1. Track website traffic.
  2. Track website conversions and know the average sale price.
  3. Fix code errors on your site.
  4. Use keywords that people are searching for. (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.

Processes to Implement:

  1. Install Analytics on your site to track traffic.
  2. Create processes to track conversions and get an average price per sale.
  3. A website may need to be updated/changed/improved in some fashion. This goes from small edits to a full re-build, with SEO in mind. 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 some insight into how often certain words are searched in a month. But you need 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") 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, maybe shared and reposted). Outreach to website owners, industry partners, and social media efforts is key.
  7. Measure against competitors and watch for people using the words you want to rank well for.

*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?
  4. What point do you need to reconsider the investment?
  5. Who will make the changes needed?

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

Other Benefits from SEO efforts

  1. An SEO campaign should be feeding 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, then eventually look up something organically and click through to your website.
  5. An SEO campaign should provide you data that can be used 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.


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