Search engine optimization (SEO) is one of the most popular current-day marketing practices. This coincides with the rise in general internet and social media marketing. Using the internet as a platform for marketing expands your company’s reach in ways previously unimaginable.
Whether you’re creating blog content or simply using social media as a marketing tool, these strategies have proven highly effective for many companies.
But how do you prove that?
ROI of SEO: The best way to prove that SEO marketing techniques are actually working for your business is to analyze your return on investment. ROI basically refers to whether you’re getting bang for your buck. It will let you know whether the money you’ve invested into your SEO marketing practices and SEO company is paying dividends.
How do you measure ROI?
Can you measure the monetary value of digital marketing?
Is that even possible?
Of course, it’s possible! This article will explain how to measure SEO ROI in detail.
What is SEO ROI?
Before explaining how to measure SEO ROI, it’s important that you know exactly what it is. SEO ROI measures your return on investment for search engine optimization. There are various factors that your business could measure to analyze SEO ROI.
Some of these factors include:
- Search engine rankings
- Organic website traffic
- Goal completions
But what do these factors entail?
Well, when analyzed alone, these factors don’t really mean anything. They have to be put into context by using what experts in the marketing industry call the SEO ROI formula. The formula is as follows:
- Gain from investments – Cost of investments / Cost of investments
This formula will help you understand if the investment that you’ve made for an SEO strategy was actually worth the money you paid for it.
Now, let’s go through a few ways to calculate SEO ROI.
How to Calculate SEO ROI
There are three major steps that will help you to calculate your SEO ROI:
1. Start Tracking Conversions
Any good SEO strategy is focused on creating or increasing conversions. You may be wondering what a conversion is. Well, to put it in the most simple of terms, a conversion happens when a website visitor, blog reader, or targeted prospect converts into a paying customer.
SEO seeks to convert a reader into a buyer. The more conversions your SEO strategy creates, the more successful the marketing campaign has been.
So, it makes sense that your ROI will be positive if you track high conversion rates. You can use Google Analytics to easily track conversions from your blog or your website.
Conversion tracking is useful for measuring the overall success of your website or conversion rate optimization tools other SEO-related marketing efforts.
Tracking conversions is the first step in determining your SEO ROI. The more analytics and conversions you analyze, the more you’ll understand about what makes your SEO strategy successful or not.
2. Focus on Lead Generation
Lead generation is also an extremely important feature of an SEO marketing strategy. A lead is someone that your business suspects could become a paying customer. By marketing in an online capacity, through SEO, your company will hope to generate leads.
The more leads you generate, the more successful your SEO strategy has been. The more successful your SEO strategy, the better your ROI.
But it’s not only about generating leads. Leads can be analyzed in depth to know exactly how successful your marketing campaign has been.
Ask questions like:
- How many leads have converted into actual sales?
- What is the average value of each sale?
- What is the average value of each lead? (this can only be measured after the previous two questions have been answered).
By doing some in-depth analysis on your lead statistics, you can easily determine your SEO ROI.
3. Calculate the Value of Your Organic Traffic Conversions
If you’ve been doing research on SEO strategies, you’ve probably heard the term organic traffic quite often.
Organic traffic refers to the number of people who visit your website on a daily basis. The organic part refers to their ability to find your website of their own accord. Whether they were searching for a specific blog article or saw something on social media that led them to your site.
All of these types of visitors constitute what we call organic traffic. When someone who forms part of the organic traffic pool converts into a customer, your SEO strategy has worked.
In essence, that is what SEO marketing is all about. Creating conversions and generating organic traffic.
The more organic traffic conversions you have, the more profitable your business will be. This makes organic traffic hugely important when you know how to calculate profit margin as you can immediately see the results.
What are the Challenges of Calculating SEO ROI
So, we’ve gone through some significant factors to focus on when calculating SEO ROI. The factors above are hugely significant in determining the value of your digital marketing campaign.
But is it really that easy?
Not always.
There are a few challenges that you’ll need to overcome when analyzing your SEO strategy:
- SEO and Brand Building: SEO marketing is about creating conversions. We covered that already. But more than that, it is also about building a brand. The popularity and public conception of your brand are more difficult to measure than, This part of the SEO strategy is a little more vague.
- Retention: While you can measure the immediate conversions that your SEO strategy creates, you can’t accurately measure how SEO impacted customer retention.
- Testing SEO: SEO is one of the greatest innovations in the marketing industry. Over half of all companies now implement SEO in some shape or form. The biggest hurdle that most companies need to overcome is that SEO can’t be tested. You simply need to implement it and hope for the best.
Wrapping Up
This article explained the importance of SEO marketing and why it’s proven most effective for most businesses. The only issue is measuring how successful your SEO investment has been.
We provided you with a few important factors to focus on when measuring the ROI of your SEO strategy. If you can apply these to your marketing methods, you can see where your efforts are paying off, and where you need to focus more energy on. In doing so, you’ll be able to boost your ROI and build your brand.
Suggested Read: SEO Audit Tools that you need.
