When you spend money, most of the time, you do it so that you can get something else in return. This is applicable even to search engine optimization strategies. Whether you have planned your SEO techniques on your own or an SEO agency has done it for you, you must expect a positive return on the money you have spent.
Because of this, you must know how to measure the ROI of your website’s SEO. It might not seem easy since you will need to track various metrics. However, there are only three steps that you will need to follow. These steps will be explained in more detail later on.
Why Should You Measure Your SEO ROI?
You might think that measuring your website’s return on investment is a hassle. However, it is a task that you should always do. It does not matter whether you sell products and services or not. If you want to see the current value of your website, you should track its SEO ROI.
When you get the number, it can help you determine whether you are spending too much or too little on SEO services. Knowing your website’s ROI is necessary if you have an in-house SEO team or are hiring an SEO agency. It will tell you whether their services are effective or not.
When Should You Measure Your ROI?
You might be tempted to measure your website’s SEO ROI only once a year. However, that is bad practice. To know how effective your current SEO strategies are, you need to assess your site’s ROI several times a year. Doing quarter, half-year, and annual measurements is the best course of action you can take.
3 Steps on How to Measure ROI for SEO
Even though measuring your return on investments might seem overwhelming, you would only need to follow three steps. While the second step might make you use an initially unfamiliar tool, the steps are detailed and can guide you.
Here are the three steps you should follow to measure your website’s SEO ROI.
1. List Down Your SEO Investment
Before you start tracking your website’s different conversion metrics, you would need to determine how much you have spent on your website’s search engine optimization. While most of the costs you would consider are monetary, you should also consider the time and other resources that you have spent on your SEO strategy.
If you availed of the service of an SEO company, it would be easy to track your investment. If you left your website’s SEO entirely in their hands, then you would simply need to know your package fees. Make sure that you include any additional expense that they may have noted. If you avail of the service for a digital marketing agency, consider your payment for them, too.
Measuring your investment can be more complicated if you have an in-house SEO team. If you are the one paying for their hourly or daily rates, note them down. If you have a team that includes other roles, only get the rates of individuals who directly participate in SEO techniques. If you are also paying for your team’s SEO automation tools, add them to your investment costs, too.
Finally, if you perform SEO strategies on your own, it might be harder to track your investment. The most solid rates you can get are by listing down the fees you use for your SEO tools. Since you use them for better search engine optimization, you should include them. Remember the hours of work you have done for your website’s SEO. Give yourself an hourly or daily rate and include them in your investment costs.
2. Prepare Your Conversion Trackers
The second step is slightly more complicated than the other two steps, but you can easily do it independently. It is crucial that you can track your conversions properly because you will need this for the last step. While you might be worried about how to do it, you will only need Google Analytics to track the conversions from your website.
However, you should note that the conversions you assess depend on what type of website you have. If you own an eCommerce website, there are specific values that you will have to check out, like the sales of your product. If you are not offering services or products on your site, you will have to rely on lead conversions.
In more detail, here are the two ways you can track your website’s conversion rates.
Tracking for eCommerce Websites (Sales Tracking)
If you sell products and services, the primary metric you will need is your website’s sales and revenues. To start with, you will need to use Google Analytics. It is the best way to check out the different metrics of your website.
If you have not set it up yet, do not worry. You will simply need to log into your Google Analytics Account. After that, go to the Admin page. After that, select View and then go to eCommerce Settings. Once you reach that view, you will see a section that says Ecommerce set-up. Toggle both Enable Ecommerce and Enable Enhanced Ecommerce Reporting on.
Once both settings have been turned on, you will access a page for the different conversions on your site. Mainly, you will find an Ecommerce section in the Conversions tab. If you do not know where to find this tab, simply open the Analytics page.
You will be able to see your website’s current revenue if you select Overview under the Ecommerce section. However, before you look at it, ensure that you filter the numbers you see. To do this, segment the data and choose to see results received from organic traffic only.
Once you have filtered your view correctly, you can now return to tracking the revenue data in your eCommerce Overview dashboard. There will be other performance metrics, but you will only need to take note of the revenue that your website has received.
Tracking for Non-eCommerce Websites (Lead Tracking)
When you do not sell any product or service on your website, you will determine your ROI by following the lead generation on your website. While this is harder to track than revenue values, it can still be done. Like the previous tracking method, you would need to log in to your Google Analytics account.
Once you are in, go to Admin. Proceed to View and then click Goals. Once you reach it, you will see a lot of sections. Notably, the one you should focus on is the Goal setup.
Choose to create a custom goal instead of using the basic template or the smart goal. This ensures that you are tailoring the metrics to what your website needs. After choosing custom as your goal set up, you need to fill up your goal type and goal name.
Afterward, you will reach the goal details. To track your ROI, you will need to assign a monetary value for essential pages on your website. Save the settings and do it for every page that should generate a lead.
Once you are done, go back to the Conversions section on the Analytics page. Filter the results by choosing to measure numbers received with organic traffic only. You will be able to see a Goal Value. Take this number because you will need this for your next step.
3. Use the ROI Formula
The last step on how to measure ROI for SEO is straightforward. You would simply use the values that you have received from the previous steps and calculate them using a specific formula. This formula is:
(Conversion Value – Investment Cost) / Investment Cost
For a clearer example, you can suppose that your current conversion value is $100,000. The amount you have invested in SEO services and tools is $15,000. When you apply them to the formula, you will get this:
($100,000 – $15,000) / $15,000 = $5.67
This means that you have received $5.67 for every $1 you spent. With this number, you can determine that you have received a 567% return on your investments.
As long as your numbers for both your conversions and investment costs are accurate, then this is an excellent way to measure your ROI.
Investing In SEO for Bigger ROI
If you find that your website has a low or negative ROI, then it means that you are not correctly utilizing your SEO services. There might be several reasons for this. Your SEO strategy might not be working efficiently. If you own a team, your specialists may be targeting the wrong market. If you are doing it independently, you might not be doing it correctly. If you avail of an SEO agency’s service and still receive zero to negative ROI, they may not be the right fit for your website.
To turn your negative ROI into a positive one, you should invest in a reliable and trustworthy SEO company. Because they are experts in the field, you will not have to worry about wasting money. Instead, you will receive more ROI than expected because your lead generations or revenues can grow with their tried-and-tested search engine optimization strategies.