It is easy to report on your organic traffic data. But how do you show the value of your SEO efforts?
How to Measure ROI on SEO
(SEO Conversions Value – SEO Expenses) / SEO Expenses = SEO ROI
You measure the return on investment of your SEO efforts by subtracting your SEO expenses from your SEO conversions value and dividing that by your SEO expenses.
In order to fill out the formula above – you need to find out your SEO conversions value and your SEO expenses.
How to Find Your SEO Conversions Value
You can find your SEO conversions value by looking at your analytics data. What you track and report on depends on if you are a lead-based business or an ecommerce site.
Finding Ecommerce SEO Value
Hopefully you already have ecommerce tracking in place. If not learn how to set up ecommerce tracking in Google Analytics here.
Go to your ecommerce report:
Segment by Organic Traffic:
Now you can see the revenue generated by your SEO efforts.
Finding Lead-Based SEO Value
Hopefully you already have goal tracking in place. If not learn how to set up goal tracking in Google Analytics here.
To show the SEO ROI on a lead-based site, your goals should have associated values.
How to determine goal values
- Discover how many of your leads end up as customers for each goal
Example 1: if you get 1000 contact us form submissions per month and 400 of those leads become customers, that goal has a 40% lead-to-customer conversion rate.
Example 2: if you get 100 click-to-calls per month and 50 of those leads become customers, that goal has a 50% lead-to-customer conversion rate.
- Discover the average lifetime value of each customer.
If each of the leads that become a customer has an average lifetime value of $5,000, your average value is $5,000.
- Discover the value of each goal completion.
Discover the value of each goal completion by multiplying the average lifetime value of each customer by the goal’s lead-to-customer conversion rate.
Example 1: A contact us form submission has a value of $2,000. $5,000 x 0.4 = $2,000.
Example 2: A click-to-call has a value of $2,500. $5,000 x 0.5 = $2,500.
When you enter these values into your goals, you can see the estimated value generated by your SEO efforts.
Your Attribution Model Matters
Google Analytics by default uses the last interaction attribution model – meaning the last touchpoint receives all the credit for the sale. If a user clicks a display ad and exits. Enters again by clicking through a social post and exits. Then searches the brand name, enters on an organic listing, and converts – organic search gets all the credit.
You can see how the different models would impact your channel reporting in Google Analytics here:
How to Find Your SEO Expenses
You can find your SEO expenses by adding up how much you spent on agency resources, in-house resources, and SEO software.
How much did you pay an agency for SEO work?
Do you have full-time SEO employees?
How much time do your internal employees spend managing SEO work – whether doing the SEO work themselves or working alongside an agency? Account for that portion of those employee’s costs.
Do you spend money on any SEO software?
Add up all those variables to account for your SEO expenses. Then take your SEO Conversions Value and complete this formula to find your SEO ROI: (SEO Conversions Value – SEO Expenses) / SEO Expenses.
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