A bit of number-crunching and a calculation is needed to understand the value SEO can bring to your business
Done correctly, optimizing your site should bring more traffic and sales. But estimating these changes before work begins isn’t straightforward, which means it’s not always easy to see the value of SEO.
In this short article, I’ll share the formulas you need to work out the estimated value of search engine optimization. That way you can decide if the time and money you plan to spend on SEO are truly worth it.
Balancing ambition with reality
An optimized site can bring great business results. And while I’m all for aiming high with your SEO targets, it’s also important to remain realistic. A successful SEO roadmap includes a lot of moving pieces. Each part needs to play it’s part so the overall strategy works.
The possibilities are endless in terms of what value SEO can bring and what success looks like for your business. But if there’s one thing you should understand, it’s that you won't rank in the top position for every keyword you're targeting. The formula in this article is a guideline
Seeing SEO value starts with gathering numbers
To estimate the extra value SEO can bring to your business you need a baseline set of numbers. This lets you measure the change in traffic and sales, so you can see how well (or not) your SEO plan is working.
There are three sets of data you need to gather in order to do the math.
1. Total search volume
A keyword is only useful if people are typing it into the search engines. Use an SEO tool to pull data on the total search volume for your target keywords.
Enter each of your target keywords and export total search volume. Most tools also provide keyword difficulty, how easy or hard it might be to rank for a particular keyword.
Each tool has its own scoring system. Make sure you understand how this works for the keyword tool you’re using so you gather the right data. An explanation of this is usually detailed inside the tool.
Save the list in Excel or Google Sheets.
If you’ve not yet chosen your keywords
Right at the start of your keyword journey, then you need to pick out your preferred keywords before you can work out the estimated value of SEO. Using the search volume for each keyword pick out two or three that relate to the core of the business. Picking these often means following your gut.
It may not sound technical, but there are a couple of key characteristics you should look for when hunting out ideal keywords. As I mentioned, the words should be relevant to the core message and purpose of the business. They should then be supported by two or three keywords that are high volume and low competition. These tend to be longtail search queries.
2. Conversion Rate
A ‘conversion’ is the end goal action you want a person to take. It could be making a purchase, filling out a form, downloading something or clicking a link. What you consider a conversion depends on what your business does and the thing you’re trying to measure.
You should have your conversion goals set up in Google Analytics. Grab these numbers as they currently stand. Run your report for the last 12 months to allow for seasonal times.
3. Average Order Amount
This is only relevant if your site is sales based. Again, you’ll need to look in Google Analytics to find the average amount your customers currently spend per order. Look back over the past 12 months as you do with conversion goals.
Now you have the data, it’s time to apply the formula
It takes a concrete formula to come up with a realistic estimate. And there are two formulas to help you see the value of SEO. Which one you use depends on whether the goal you’re measuring related to leads or sales.
If you’re measuring leads, use the following.
Total search volume
(percentage of clicks to the first five positions of organic search results)
Leads generated by organic search
If you’re measuring sales, you need this formula.
Total search volume
Average order amount
Sales generated by organic search
And that’s it. Using these equations, show you the minimum estimated return on SEO spend and revenue potential from organic search. Of course, you’ll get out as much as you put in. So the more love you can show your SEO plan, the more likely it is that you’ll see bigger returns.
Got questions? Drop me a note using the form below. Happy to help.