The most common question I hear from small businesses about organic SEO is:
Fair question. Every small business wants to calculate a return on investment (ROI) for SEO based on their current and forecasted organic search traffic.
In this post, let’s find an answer by looking at two areas: how to forecast organic search traffic and how to calculate the ROI of SEO.
This is a small slice of an organic SEO content strategy. It’s purpose is to help forecast organic search traffic in lieu of creating an entire organic content strategy.
An entire strategy can take up to a week. There is a lot of information, hours, and effort.
If we wanted to provide a more exact forecast of traffic, then we would need to complete an entire strategy. But the first chart provides a quick, rough estimate that enables us to forecast.
The first step is selecting three target keywords. These keywords should be selected based on predicted “category clusters” that could play a part in the strategy.
What’s a category cluster? In our definition, a category cluster is an in-depth group of keywords around a specific topic. For example, we selected “cooking classes nyc” and “cooking classes chicago” because the category cluster would ideally be around “local cooking classes.”
Another category cluster could have been around local food cooking classes, like “pizza cooking classes nyc.”
The selection of these keywords is important, because we can then forecast estimated search traffic based on a single (or multiple) volumes. For cooking classes, we can then forecast by the number of cities we will be targeting.
Keyword search volume provides an estimate of how many times a keyword is searched per month on Google. For example, “cooking classes nyc” is searched 5,300 times per month while “cooking classes chicago” is searched 1,900 times per month.
These two samples lend some insight into the volume for priority cities, as well as a range to calculate for other cities.
Keyword Difficulty estimates how hard it will be to rank in the top 10 organic search results for a given keyword in a given location. It’s calculated by taking a weighted average of the number of linking domains to the current top-ranking pages. The result is then plotted on a logarithmic scale from 0 to 100 (low difficulty to high).
This metric is especially useful to see how much of our Digital PR efforts should go towards a keyword. And, as you’ll see in the ROI calculations below, the difficulty score also helps us decide whether the keyword should be targeted by SEO or PPC.
Cost Per Click (CPC) shows the average price that advertisers pay for a click on their ad in paid search results for a target keyword in a given country. This metric provides some insight into the overall commercial value of a keyword.
This metric is especially helpful when deciding whether to pursue a PPC or SEO strategy.
This calculation figures out the overall value of a keyword. The value is calculated by multiplying the keyword search volume by the keyword cost per click and then multiplying by 12 months.
Performing this calculation helps us prioritize one keyword over another in a SEO strategy.
This conversion rate is purely an estimate. We typically use a 5% organic conversion rate for “high-intent” pages. High intent pages are designed to align very closely with what a user is searching for.
Users searching for “Cooking Classes NYC” that land on a NYC cooking class page will typically have a higher conversion rate than a general “cooking classes” query. For the generalized keywords, we will use an estimate of 2%.
These conversion rates are helpful to forecast what value a SEO strategy will bring to a website.
What would being on Page 1 for a specific keyword mean for your business? That’s what our Page 1 Conversion calculation aims to answer.
Here’s the math we take for this calculation:
This equals the estimated Page 1 conversions.
We now need to factor in where a website currently ranks. To do this, we will look at the current search position a website has for a given keyword. Then, we will estimate the current conversions from this search engine results page placement.
The end result is the Estimated Conversion Increase.
Now, the fun part! Revenue increase as a result of an SEO initiative.
We will take the average conversion value for a website. Then, we will multiply the average value by the estimated conversion increase.
This calculation gives us the estimated revenue increase, per month.
Using the above process, our three cooking class keywords would drive an estimated $6,500 / month with a Page 1 ranking.
This is great to know! Especially since our monthly SEO engagements are designed to drive value like this every month.
So as a business owner, I now know that if a SEO initiative were successful, I could expect a nice ROI when factoring in my expenses.
Does that help answer the question, “How many more website visits can I expect through SEO?”
The answer can be found in estimates, and then validated throughout an SEO engagement.
If you would like to have a greater confidence entering into a SEO engagement, then utilizing our keyword research services would build out an entire SEO strategy with exact target keywords.
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