Measuring ROI With SEO
How do you know if an SEO company is earning it’s keep?
How do you decide if the time, effort and money you’ve put into your own SEO has been worthwhile?
It’s not by looking at your rankings… It’s by looking at your profits and conversions.
Ultimately, if you are spending money on SEO then all that matters is that you are making that money back – and ideally making more than that amount back. This is ‘Return On Investment’ or ‘ROI’ and it is ultimately the single most crucial measure of SEO success.
But how exactly do you discover your ROI? And why is it so hard to monitor?
Why SEO Success Can be Hard to Measure
When you first hire an SEO company, they will normally inform you that it is impossible to ‘guarantee’ a position in the SERPs (search engine results page). They are not wrong about this and indeed there is no way to be absolutely sure that you will get a certain result – apart from anything else, no one fully knows the ins and outs of Google’s algorithms and thus what it is looking for.
Not only this , but it can also take a while for changes employed by an SEO company to be reflected in your position (even with Google’s ‘Real Time’ ranking).
So if you hire an SEO company and nothing happens for the first couple of months… well then that’s actually to be expected somewhat!
The other problem is that it’s very easy for an SEO company to make it look like they’re creating more success than they really are. For example, it is very easy for an SEO company to help a website rank for a term that no one is looking for where there’s no competition and to the uninitiated, this can look like great progress!
“Did you manage to get us to rank for ‘buy hats online’ yet?”
“No, that will take a little while. But we have been able to get you to number one for ‘buy bobble hats that are blue for winter’!”
And even if the company does manage to get you to rank for a competitive search term… that doesn’t necessarily mean anything if the wrong people are searching for that term! Good SEO should include smart keyword selection and that means helping you to target visitors that are actually likely to convert!
How to Get More Systematic
So how can you become more systematic and measure the success of an SEO campaign in real terms?
The first thing to do is to keep track of how much you’re spending. It is fine if you take a couple of months to see results but only if the results that eventually come will make up for this! That means you need to be able to pin point the breakeven point for your SEO and you should get an accurate estimate for this before you commit yourself to a particular plan.
What’s also important is to look at how your sales improve as your rankings improve. If your traffic goes by 1,000 visitors a day following the start of a new SEO campaign, then it might be tempting to view that as a big success. But if none of those visitors is actually buying anything… then it’s actually still been a waste of money.
Looking at things like engagement can help you to identify if your visitors are actually interested in your site rather than hapless having been tricked into going there. Check your bounce rates, average time spent on site, number of pages per visit etc.
But more importantly, look at your sales. Did your sales go up as a result of that increased traffic?
Getting More Precise
You can get even more technical while measuring this ROI too, should you wish.
One way to do this is to use goal tracking in Google Analytics. This allows you to look at how many of your visitors make it to a particular page on your website and normally that page will correlate with a conversion (it might be a confirmation page for a purchase for example). This way, you can then start to monitor your conversions and track other behaviors that seem to correlate with people buying or placing an order.
Specifically, goal tracking will allow you to see whether buyers came from specific search terms. This way, you can track your ranking on specific SERPs to see if your SEO efforts are improving your position and then see if that position is bringing you more traffic!
Also important though, is to recognize that the value of your SEO might go beyond individual sales. For instance, you might find that some of your visitors actually buy from you multiple times and become lifetime customers. This is why it pays to calculate your ‘CLV’ or ‘customer lifetime value’.
Another consideration is whether some visitors are signing up to your mailing list as a result of your SEO – as new leads have value too. And then there’s value to be gained simply from the increased visibility that comes from a high search position!
Using This Information
Of course it’s better to try and anticipate your projected ROI for an SEO campaign before you inject lots of money into it. One quick tip to help you do this is to try using PPC for the search terms you’re targeting. By using AdWords, you can pay to get your ads immediately to the top of the search results and that will allow you to see just how much you can stand to earn from different keywords.
If you do find yourself losing money consistently from an SEO campaign though, that doesn’t mean you need to give up on SEO entirely. Rather, it simply means you need to look at the data you’ve collected and try to assess where and why it’s not working as it should. From there, you can keep tweaking your approach and your spend until you start to see the solid ROI you need!