It is puzzling that many savvy business people who run an online company still view SEO as an unnecessary expense. Such individuals need to look beyond the initial cost of SEO and start seeing the bigger picture. They need to decide what they expect from an SEO campaign. Naturally, the whole point is to increase visibility on search engines which leads to a higher level of traffic and ultimately more sales. As SEO is a proven method of improving a company’s fortunes, it’s odd that certain companies refuse to utilise it. Perhaps the best way to truly understand the usefulness of SEO is to find out the potential return on investment and hope search engine optimization can deliver it.
The whole reason why you’re using SEO is to make a profit. However, you can’t expect to get a return on investment immediately. Strategies like link building can take several months to deliver results. Instead of looking at the investment in a month or two, analyse it after a year has passed. You also need to look at the number of leads and sales that have been generated by your SEO efforts. Google Analytics is a fantastic tool for helping you find out specific site statistics. Finally, you calculate how much each lead or sale cost you.
It should also be noted that the time you have spent on your SEO campaign must also be added to the cost. For example, if you spent an average of 10 hours a week on SEO for 26 weeks and made a gross profit of £1,300, your average hourly earnings from SEO would be £5 an hour which is certainly not good enough.
Another classic method of discovering whether or not SEO gives you a good return on investment is through the calculation of a customer’s lifetime value. For example, your average customer may spend £30 each time they purchase something from your business which they do 4 times a year for 4 years. In addition, the average customer refers your company to his friends and brings in 3 new customers who buy an average of £300 of goods each over a 4 year period. The first customer spends a total of £480 (30 x 4 x 4) and his friends spend a total of £900 (3 x 300) so the lifetime value of your average customer is £1,380.
Then you have the small matter of calculating the conversion rate of your SEO campaign. This is the total percentage of people who have visited your site and purchased something, subscribed to a newsletter etc. You can take this to a more complex level by looking at your conversion rate per keyword. For example, if 5 keywords convert at 10% and another 5 convert at 6%; your overall keyword conversion rate is 8% (10 x 5 + 6 x 5/10).
These are just some of the ways that will help you determine whether or not your SEO campaign is delivering a satisfactory return on investment. In all other forms of business, it is a well known fact that you have to invest capital in order to succeed and online business is no different.
Zeno are a well-respected online agency, providing search engine optimization services to small and medium business across the globe. In addition to serving end users, Zeno is a leading SEO Reseller, supplying some of the largest agencies with white label search marketing solutions. Contact us today to find out more.