The most important question to ask about any type of marketing is, quite simply, “Is it worth what I’m paying for it?” In other words, what’s the return on investment (ROI)?
SEO is no different, except that in many ways the ROI is harder to calculate than, for example, pay-per-click advertising. This is because SEO is very much a long-term strategy, so short-term measurements don’t always tell the whole story. So how can you best calculate your ROI on your SEO campaign?
Why is Measuring Your SEO Important?
It’s calculated that, for an average business, around 53% of web traffic comes from organic search — and it’s the quality of the website’s SEO that determines how effective that organic search will be.
SEO isn’t free, though, whether or not you keep it in house. Costs may include a proportion of personnel salaries, costs of outsourcing to an agency and cost of tools and software. Clearly, you need to be able to demonstrate that this is money well spent, and you can’t do that without knowing what rate of ROI you’re getting from the SEO.
How Do You Measure Your SEO’s Effectiveness?
The easiest do-it-yourself method of measuring the effectiveness of your SEO is to use Google Analytics to measure your conversion rate. You then estimate the average value of each conversion and multiply the two figures together. Finally, you divide the figure by the costs to get the ROI.
For example, suppose you achieve 20 conversions over the period you’re measuring, and you’ve estimated the average value of a conversion is £1,000, while you’ve spent £5,000 on SEO. The calculation would be (20 x 1,000)/5,000 = 4 — making your ROI 400%.
How to calculate SEO ROI
Initial SEO Spend
Average Conversion Value
Number of Sales
20 sales made
Return on Investment
ROI of 400%
(£20,000 ÷ £5,000)
This isn’t too difficult to estimate if you have an ecommerce site, but for other types of websites there are a number of problems. For one thing, the decision to visit your website may have been the result of seeing your brand multiple times, while similarly a customer may visit your site several times before converting. The calculations can become extremely complex.
DIY or Use an Expert?
Suppose your car needs maintenance — what do you do? Do you dig out the manual, open the bonnet and try to fix it yourself? Or do you take it to a garage?
Well, that might depend on your interests and your level of expertise. If you love tinkering with engines and you have a good idea of what you’re doing, you might decide to do it yourself. But even then you almost certainly won’t get as good a result as if you left it to a professional mechanic with both extensive experience and access to the latest diagnostic software.
In the same way, you can learn to do your own SEO and even (if you’re anything like us) find you enjoy doing it. On the other hand, you’re likely to get a better ROI by spending a little extra on the services of experts. Not to mention having access to cutting-edge ways of measuring what that ROI actually is.
If you use Yeseo, you’ll be able to see the results at a glance. Instead of a mass of impenetrable figures, we’ll send you a monthly report about your traffic, written in Human, not in Jargon, with a simple executive summary that tells it to you straight.
Give us a shout to find out more about how you can not only improve the ROI for your SEO expenses, but also always have the results at your fingertips.
SEO ROI FAQ
ROI or (return on investment) is a method of calculating how much extra money your business has made after making an investment in SEO.
The short answer is ‘have you made more money since doing SEO?’ The longer answer involves mathematics – Calculate and average value of each of your sales. Multiply that value by the number of sales you have made. Divide the total value by the amount of money you have spent on SEO. This will give you a number you can multiply by 100 to get a percentage showing your ROI.
You can’t, at least not accurately. But a good SEO agency will refuse to work with you if they don’t see your potential to earn a good ROI on your investment. SEO isn’t always the answer!