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Content StrategySEO

Long Term Thinking: Measure the Value of Organic Traffic with SEO ROI

By June 15, 2021No Comments
SEO ROI guide

Creating and publishing content is one of the most popular marketing strategies around, but very few digital marketers know the return they’re getting on all their hard work. 

After all, how do you know how much money you’re getting from your SEO efforts? 

It’s not an easy math equation, especially since it’s hard to pin down exactly how much revenue is coming through your SEO efforts. 

If you look at other marketing methods, like PPC, working out the return on investment (ROI) is a simple calculation. The numbers are steadfast, it’s just a case of finding them and running them through the formula: 

(total ad spend + agency fees) / total $ the ads generated = ROI 

Working out the ROI of SEO isn’t so straightforward. 

In fact, many marketers consider SEO a way to get “free traffic”. But, as an SEO professional, you know that’s not true. There are tools you need to pay for, contractors to hire, the technical side of things, and any consultants you bring on board, not to mention the amount of time spent on the process. 

Here’s our comprehensive guide to SEO ROI, including what it is, how you can calculate it, and how long it takes to start seeing returns. 

What is SEO ROI? 

Put simply, SEO ROI is the return you get on your SEO strategy. It’s the amount of direct, organic-generated revenue left over after you subtract the costs of implementing it. 

Calculating SEO ROI requires you to know two things:

  1. How much you spend on SEO efforts 
  2. How much revenue you generate from SEO 

It’s easy to think that SEO doesn’t require much investment – after all, it’s just a case of writing a few bits of content and publishing them, right? It’s nowhere near as expensive as PPC campaigns and other traditional advertising methods, right? 

Yes and no.

While it can be far more cost effective than other marketing activities, there are still costs involved: 

It’s worth noting that, while there are formulas you can use to figure out your SEO ROI, it doesn’t always tell the whole story. 

Content is often one of the first touchpoints prospects will have with your brand. They might read a blog post or visit a few product landing pages, leave, and come back days or weeks later to finally make a purchase. 

How to Measure the ROI of SEO For a Specific Keyword

Ah, the tricky part. 

Measuring ROI on SEO for a specific keyword isn’t like measuring the ROI on other forms of marketing. There is a standard formula you can use, but it takes a bit of jumping around to find the right numbers.

To work out the ROI for a keyword, you need to know: 

  • The number of monthly searches the keyword gets
  • The CTR of your content (or, at least, the position you’re ranked in) 
  • The monetary value per visit 

Here’s the formula: 

Monthly searches * CTR * value per visit = estimated monthly value 

Here, the estimated monthly value essentially refers to your revenue. It’s then a case of subtracting your expenses from that to figure out your ROI:

Monthly value (or revenue) / SEO costs x 100 = ROI % 

To put the formula to use, you need to get the metrics for your monthly searches, CTR, and the value per visit.

1. Determine Your Organic Search Volume

To estimate the organic search volume of the keyword you want to do the ROI calculation for, you can do a couple of things. 

adwords keyword planner

First, load up Google AdWords Keyword Planner which will provide a wide range of estimated organic traffic

If you’re using a relatively popular search term, this number might vary by a lot, making it difficult to run an accurate calculation. However, you might want to take a note of the “top of the page bid” for your chosen keyword as this can help you later on in the formula. 

In the example above, the keyword “choosing a domain name” gets between 100 and 1,000 searches per month (1,300 in the last month), and has a top-of-the-page bid of £2.07.  

If the organic search volume range is too wide, you can use a tool like Ahrefs Keywords Explorer, which provides a far tighter range for search volumes.

ahrefs keyword research

2. Figure Out Your CTR (or Google Position) 

Next, you need to figure out your search engine position for that keyword to estimate your click-through rate. It’s a no-brainer that the top results get more click-throughs, so it’s a good idea to shoot for those if you want to see the biggest ROI. 

Use Google Search Console to track your position for a specific keyword and to determine how many click-throughs your content gets for that keyword. 

google search console CTR

3. Work Out the Value of Search Traffic

The final part of the equation requires you to know how much each visit to your site is worth in monetary terms. 

There are two main ways to do this: 

  1. Use the estimated bid number from Google Adwords
  2. Work out the page conversion rate and accompanying dollar value 

The first option is much simpler, but it’ll just give you a generic guesstimate rather than the true figures for your brand. 

To carry out the second method, you need Google Analytics set up with goals and conversion tracking in place. From there, you can get the average conversion rate for a specific page (a.k.a. the page your keyword is pointing to) and the average amount people spend when they buy from you. 

The formula will look something like this: 

Conversion rate * average order value = value per visit

Putting It Into Action: Calculating Your SEO ROI for a Keyword  

Let’s use an example to calculate the hypothetical ROI of a keyword. 

For the sake of this post, let’s imagine you want to rank first on Google for a keyword that gets 5,000 searches a month. 

Let’s say the CTR for this query is 30% (about average for the top spot), which will drive 1,500 visitors to your website. If your website has a 2% conversion rate, the keyword should get you 30 new customers each month. 

And, finally, if the value of each visit is $50, it will give you an estimated revenue of $1,500 per month. If you spend $800 on tools, contractors, and consultants, that’s an ROI of $700. 

It doesn’t seem like a lot, but that’s just for one month – the first month. 

The biggest benefit of SEO is that it’s a slow burner and brings in revenue long after you’ve optimized the page and written the content. Over the space of a year that $700 quickly turns into $8,400 (even more if you lower your SEO expenses each month). 

How to Measure the Overall ROI of SEO 

The above formula shows you how to calculate the ROI of each keyword, but what about the ROI of your SEO efforts as a whole? 

Investopedia recommends the following formula to do this: 

(Gain from Investment – Cost of Investment) / Cost of Investment

Then, multiply the result by 100 to get your ROI percentage. Start by adding up the ROI of each keyword you’re targeting in your SEO strategy until you get an overall revenue number. Let’s say that number is $75,000 and you’ve invested $10,000 in your strategy. The formula would look like this: 

(75,000 – 10,000) / 10,000 or 65,000 / 10,000 = 6.5 

Multiply this number by 100 to get an overall ROI of 650%.

What is the Average ROI for an SEO Campaign? 

This is the million dollar question: how do you know if the ROI you’re generating is good enough? 

The truth is, the number will vary depending on your industry and the price point of your products or services. 

On top of this, the cost of investing in SEO will fluctuate each month as you ramp up content efforts, hire more contractors, or streamline your SEO toolbox. 

On top of this, the cost really hangs on a number of factors, including: 

  • If you hire a marketing agency 
  • If you bring in an in-house marketer
  • How much content you push out each month
  • The value of each keyword
  • How much time you invest in the process 
  • If you DIY your SEO efforts 

How Does the ROI of SEO Compare to Paid Search ROI?

Here’s the deal: you can get hard and fast figures for Google ads and you can start to see returns pretty quickly. Overall, leads from SERPs have a much higher close rate, but this can refer to both paid-for visitors and organic website traffic. 

The best option is to use both paid ads and organic SEO in tandem. Paid ads bring in revenue while you work on ramping up your SEO efforts, but it’s your SEO efforts that will pay off in the long term. 

Getting your content ranking in the top spots on Google can explode your growth and provide a much more cost-effective customer acquisition model. 

And How Long Does it Take to See ROI From SEO? 

Another million dollar question. 

SEO investment is a long-term endeavor, but it can lead to staggering levels of growth if it’s done right. As a general rule, it takes about 3-6 months to start seeing traction on your efforts, but it can really ramp up from there. 

The amount of time it takes to start seeing results from SEO also depends on: 

  • Your domain authority: if your domain authority is low (less than 30), it’ll take a lot longer to see results from SEO
  • Your industry: if you’re in an industry where your competitors have been investing in SEO for years and have a good amount of traffic, it’s going to be harder to compete
  • The keywords you’re targeting: the higher the keyword difficulty, the harder it is to rank in a good position
  • Your backlink strategy: if you have a tight backlink strategy in place, you have a higher chance of ranking quicker 

Improving the Value of SEO for Consistent Growth 

Like anything, SEO is a game of trial and error. It requires constant tweaking, tracking, and optimizing to see the best results. 

If you’re committed to improving the value of your SEO and consistently increasing your ROI, here’s what you can do: 

  • Work with an experienced agency: don’t throw spaghetti at the wall and hope it sticks. Partner up with an experienced agency (like Omniscient!) who know exactly what to do to get you ranking 
  • Invest in keyword research: this is the foundation of your SEO efforts. Half-job it, and you won’t get the results you want. Invest in the right tools and research to get off to a good start
  • Create incredible content: if keyword research is the foundation of your SEO efforts, content is the backbone. ROI relies on conversions, and the only way you can do that is by consistently publishing amazing content 
  • Set goals and targets: keep looking forward and monitoring your results. Knowing what you’ve achieved so far will help you map out your next steps 
  • Play the long game: most importantly, don’t give up! SEO is a long-term investment that you’ll only start to reap the rewards from after a few months 

If you’re ready to ramp up your SEO efforts, we’re here to help. Start by watching this video on Content Growth Model that will supercharge your lead generation process, or book a free strategy call with our experienced team.

Lizzie Davey

Lizzie Davey

Lizzie is a freelance writer and content strategist for SaaS and eCommerce brands, specializing in creating long-form content that gets shared and sells. When she's not typing away at her desk in sunny Brighton, you can find her exploring new places, hanging upside down on aerial silks, or going on a long walk.