If there’s one thing all SEOs struggle with regularly, it’s proving the ROI of their efforts - and I can understand why.
After all, how do you show a tangible return on something as volatile as content marketing or search engine rankings?
How do you convince stakeholders to continue allocating budgets to a channel they suspect might have worked without your input anyway?
To combat this, SEO teams develop different strategies to measure the SEO ROI. Yet, many fall under scrutiny from their CFOs and other stakeholders. Oftentimes, this is due to the unclear metrics on which they report.
In this post, I will help you overcome this challenge. I’ll show you a strategy for proving the ROI of SEO many of our customers have already used successfully.
Before we get to that, let’s first define the main SEO KPIs.
When advising our clients, we always recommend splitting SEO metrics into two distinct categories.
The primary KPIs are those that prove the success rate of your efforts. Metrics in this category include:
- Conversion Rate
- Rankings for non-branded keywords,
- Increase in the SERP real estate, and so on.
The secondary KPIs showcase the value SEO delivers for an organization. We usually suggest tracking the following metrics in this category:
- Repeat visits, to demonstrate an increase in brand awareness and loyalty,
- Assisted conversions and revenue,
- Increase in domain authority, and finally,
- A growth in searches for branded keywords, suggesting a rise in brand awareness as well.
Why split KPIs into two categories?
My answer is simple. You do this to state the full breadth of the benefits SEO offers to an organization.
By focusing on primary and secondary metrics, an SEO team can show how their work can also affect other areas of growth (i.e., brand awareness) and strengthen other channels (i.e., assisted conversions).
Two Reporting Challenges SEOs Fight Off
There are, however, two more challenges I know SEOs face when reporting on their efforts.
The first is taking credit for brand traffic. After all, brand terms can drive a significant amount of traffic and conversions. In fact, for many sites, it might easily be the majority.
As a result, SEOs have to defend questions about the validity of their efforts. Many tell me about hearing how, if the company did nothing, the channel would still perform well on its own.
But, with SEO, an organization can never tell which tactic provided the biggest growth. Often, an insignificant keyword set could drive the most valuable conversion rate.
The other challenge is tying the ROI to specific SEO strategies, particularly technical and on-site optimization. After all, how do you prove the effect of improving a technical SEO aspect on conversions?
Even though such changes seem insignificant, their effect on the user experience (and, in turn, SEO results) could be immense.
Personally, I always recommend our clients to overcome this challenge by setting baseline reports and set events.
This is also a situation where having a dedicated SEO platform like seoClarity pays off more than accessing data from Google Analytics, for example. By combining multiple data, an enterprise-level platform allows the versatility you need to report on your efforts fully.
- In seoClarity, you can set events to mark implementation dates (below).
- Then, add impacted pages to Page Types to measure the performance growth.
- Finally, create dashboards to measure the long-term impact of the change.
Measuring the SEO ROI
With the above out of the way, let’s look at a strategy for demonstrating the ROI of SEO.
We based it on a simple idea: to measure SEO ROI, you must look at the incremental KPI growth.
Doing so removes the doubt of only brand keywords driving the performance. For example, looking at how organic search traffic changed year on year, the effect of all SEO efforts becomes clear.
Similarly, analyzing conversions year over year will indicate whether the SEO strategy attracts relevant and qualified traffic.
The same applies to revenue and the effect SEO has on it YoY.
But to report on the SEO ROI fully, you need to take one more factor into consideration – the cost.
Therefore, the complete ROI calculation would include YOY incremental change (ideally, revenue) divided by the cost of delivering SEO efforts.
Of course, the cost can differ among organizations. Some might be using agencies. In their case, the cost would equal the agency fee plus the time and internal costs of implementing the agency’s advice.
For in-house teams, the cost would include time and implementation, as well as salaries and other overhead costs associated with the team.
Let me illustrate the above with an example.
Let’s assume that your previous year revenue was $10,000,000. However, in the current year, it has grown to $12,000,000.
And so, the YoY incremental revenue equals $2,000,000.
To achieve it, your organization has spent $120,000 on agency fees.
It also spent 100 hours (valued at $100/hr) to implement the agency’s recommendations. The internal cost, therefore, was $100,000.
Using the above data, we can calculate the SEO ROI this way:
$2,000,000/($120,000+$100,000) = $9.09
The total ROI of your SEO teams work, in this instance, is $9 for every dollar spent.
Most SEOs struggle with reporting on the channel’s ROI properly.
Many of them feel under pressure to do so well, particularly given how often their reports get compared with SEM or PLA, for example.
As I’ve shown you in this post, however, reporting on SEO ROI isn’t as difficult as it's often perceived. It requires you to implement two factors:
- A solid, two-tier KPI set to indicate the full breadth of the benefits SEO offers to an organization clearly.
- An enterprise platform that allows easy access to data and information about all aspects of an SEO campaign.
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