The Unbeatable ROI of SEO

Lets consider a simple example to get a sense of the potential return on investment (ROI) for search engine optimization (SEO). A top organic search position in Google for the search term "CRM" can yield an avalanche of traffic - about 1,000 clicks per day, according to Google.

 

A Simple Example

Now lets suppose that a package of CRM software sells for $50,000 on average. In order for an investment in SEO of say $50,000 per year to pay for itself, you would need to convert just one of these click-throughs into a sale every year. If you do the math, that comes out to 1 out of every 240,000 click-throughs to cover the cost of the investment, or a conversion rate of 0.0004%. On the other hand, if your conversion rate is 0.05% (5 out of every 10,000 - the low end of expected conversions), then this would yield 120 sales over the six month period valued at $6 million.

 

So would you invest $50K for $6 million in sales? How much did your last trade show cost? Or print ad campaign? And how many sales can you attribute to them? You get the point I think.

 

Running Your Own ROI Analysis

To run this same analysis for your own situation, you will need to estimate the traffic for each of the keywords for which you want to rank, and your own conversion rate for visits to your website. Better still would be to use web analytics data to discover your actual conversion rates through each stage of your "sales funnel". This analysis is sometimes limited by the fact that many companies don't transact their sale online during a single visit. In these cases it is difficult to establish the number of sales directly attributable to web site visitors. This is where your sales automation system can really help with the "close rate" for sales leads. Regardless of your specific situation, please consider giving us a call as we'd be happy to help you through this process!

 

SEO or Paid Search Ads?

Now lets compare this organic search result to going down the paid search path. To buy the number one paid search position for this same term, "CRM", would cost you over $1,300 per day according to Google, or $312,000 over this same 12 month period. However, due to user preferences for natural search listings over paid search ads, it would only yield 190 clicks per day. So at the same 0.05% conversion rate, you could expect to close 22 deals for a total of $1.1million. Not quite as attactive as the SEO route, but still compelling.

 

The big difference is that paid search requires a continued investment to yield results whereas an investment in optimizing your websiteis a one-time cost that will continue to pay off for the foreseable future! So for this reason, we always recommend that clients begin with the strategic investment in SEO as the foundation of their search engine marketing programs and then use paid search tactically to bring traffic that may not be available through SEO means.

 

Spend That Precious Budget Wisely

The point is that either way, the ROI for both SEO and paid search can be outstanding! If you are going to be competing in this kind of competitive keyword space, you are well advised to hire an expert, or risk throwing away those precious marketing dollars. And these search engine marketing (SEM) initiatives must still co-exist with and complement other online and offline marketing programs. In fact, research has proven that an integrated set of marketing programs is more effective than any single program alone. So the smart marketing teams bring SEO and paid search into the equation right from the start.

 

But integrating SEM with other marketing programs is not the sort of thing that a web-developer-turned-SEO-expert is likely to help you with - they just don't have the marketing expertise! Instead, you need a firm like StratiMind with the real operational marketing experience and strategic skills to help you craft the right balanced online marketing strategy and then excel at execution.

 

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