Instead of looking at a ranking report or obsessing over where your pages land for certain terms and queries, you should look at the ROI, or return on investment, of your SEO efforts. It can be tough to place a value on your SEO efforts since it can take so long to see results, but that doesn’t mean it’s impossible. Calculating ROI is one of the most important things you can do for your business if you want to keep moving forward. Some of your SEO tasks may seem a little bit abstract, but ROI is a metric you can measure in relation to SEO if you have a strategy and plan in place. Fortunately, enough businesses have paved the way that it’s fairly easy to get started.

Different Methods For Measuring the ROI of Your SEO

Which strategy you want to use to measure ROI is going to depend upon your business and ultimately personal preference. Keep in mind that whatever method you choose (or if you decide to go with a combination or more than one method), make sure you have someone in charge of keeping track of this data and then analyzing how to use it to the company’s advantage.

A few different approaches to measuring ROI for SEO include:

Process #1: Use Current vs. Future Figures

QuickSprout was the first to bring this method to the table here, and it’s been considered one of the best ever since. If you know how much money you already make for a specific keyword that is on page 1 (although not necessarily in the number one spot). Calculate the number of searches per month that the keyword gets using SEMRush and then as Ghost Marketing says, use the figure 7% of the search volume that the keyword generators. Then check to see how much money comes from that keyword per month (through AdWords) to come up with this calculation:

7% of the number of searches per month = How much money you generate from that one keyword X the lifetime value of your converter.

Remember just as discussed in the last point, putting monetary value on anything is just an estimate when you use these types of methods. There are a few other things to consider with this method if you’re really serious, so visit here to learn more and see actual examples.

Process #2: Create a Value for a Completion of a Goal

Throwing out a number for your ROI can definitely be risky because there are so many unknown variables, so this is something to keep at the front of your mind if you decide to take this route. If you do decide to use this process, what you should do is estimate the monetary value of an action. For example, if someone subscribes to your blog, they may be more likely to convert than someone who socially shares an article on your blog. Those who are sharing your articles, however, may be more likely to convert than someone who found your homepage through organic search and then clicked off right away.

Depending on the value you assign each of these actions, or goals, you can then do a simple calculation. For example, if you want to calculate the ROI of your newsletter marketing, then take your number of subscribers against the conversions (sales or CTRs) from your newsletter. Do this for all of the SEO efforts you’re considering to determine how much each is really doing for your bottom line.

Process #3: Use CPC Data from Your AdWords

Your AdWords has much more concrete metrics than your SEO, so you can use this to your advantage. Consider the keywords where you are trying to rank organically and then find the search volume for each keywords using a tool like SEMRush. This will then give you a CPC number that tells you the average cost that businesses are paying to earn an ad on a page that includes that one keywords term. Keep that number for the last step.

Your next step is to calculate the total value of the traffic if the website were to rank for #1 on any given keyword. Ghost Marketing wrote a great article here that discusses this same process and added that you should use 40% as a conservative figure since Google estimates between 30-60% of people click on the first organic result in Google. You can then take that number and multiply it to your CPC number to get an SEO traffic value for ranking 1st for a specific keyword. It isn’t a perfect method, which is why we’ve put it as a last option on this list, but it works well for some companies and for those who thrive on numbers.

An Extra Reminder

Keep in mind that ROI is only one factor (although a key factor) that measures the success of your SEO campaigns. Other factors include the quality of your traffic, revenue, inbound links and relationships, and even your social media success and factors, which you can learn more about in tomorrow’s blog post.

How do you calculate the ROI of your SEO efforts? Let us know in the comment section below.