ROI Is the New Ranking

  |  October 26, 2009   |  Comments

If you want to maximize your SEO, you need strong metrics. Here are some to consider.

I often talk about how there are no guarantees in SEO (define). Unlike with paid search, where the amount you spend typically correlates with the results (volume-wise anyways), with SEO, you can put a lot into it and get very little out of it.

That's why it's so important to treat your SEO efforts just like you would any marketing or promotional activity -- with a strong focus on value and bottom-line impact. And to truly measure and evaluate the impact your SEO initiatives are having, you need to have a strong measurement framework in place.

But the way we used to measure SEO has changed dramatically -- it's no longer just about rankings, PageRank, and link popularity; it's about ROI (define) and associated metrics that get you there.

When putting together your SEO measurement plan, focus on metrics that will actually tell you what kind of impact your efforts are having on your business. Even though you are not investing pure media dollars into search, there is undoubtedly significant time, effort, and dollars involved to develop and execute your SEO strategies. Regardless of whether this is done with the assistance of an agency or by an in-house team, there is still an investment being made, and this should be clearly tracked so that ROI calculations are possible.

The following are metrics to consider when evaluating and tracking SEO, also known as organic, activities. I have ranked these from least important to most important, to help you revisit your SEO measurement strategy and refocus on high priority metrics that have business impact.

Less Important:

  • Keyword rankings/positioning
  • Number of pages indexed
  • Number of inbound links
  • PageRank

Moderately Important:

  • Organic search traffic/referrals
  • Referrals from inbound links obtained through SEO activities
  • On-site engagement of organic visitors
    • Page views per visit
    • Time spent
    • Bounce rate

Very Important:

  • Organic-driven conversions
  • Organic-driven leads/sales
  • Organic CPA (define)
  • Organic ROI (return on investment)

How to Calculate Organic ROI:

  • Take the SEO investment (agency fees or employee time spent plus out-of-pocket costs)
  • Divide it by revenue, e.g., sales, generated by organic search

Although certain metrics are deemed more important than others in terms of priority, it doesn't mean that you should eliminate the lesser metrics altogether. Leveraging a combination of metrics will provide a much clearer picture as to how your SEO tactics are performing. For example, only taking into account CPA may lead you to eliminate keywords or activities that are generating a high CPA, but in reality those keywords or activities may be reaching users who are earlier in the sales funnel but at a critical stage in the decision-making process. So in that scenario, building in engagement metrics will help you get a better idea of whether those approaches are actually valuable or not. Someone who is highly engaged with your site content, using tools or downloading materials, is much more likely to return later when ready to make a purchase or initiate the sales process.

In summary, whether you've been undertaking SEO for a while or you're just starting out, be sure that your measurement framework has a strong emphasis on driving business results, not just on high level or 'surface' metrics such as rankings.

After all, ROI is the new ranking.

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ABOUT THE AUTHOR

Julie Batten

Julie is a member of the senior strategy team at Klick Health, focused on online media and digital. Julie initially established and led the media practice at Klick for several years, relinquishing leadership to expand beyond media into additional digital tactics. She brings a wealth of experience in search marketing, digital media, and all facets of digital strategy to bear, helping Klick's clients develop innovative digital solutions. As her role has evolved, so have her contributions to ClickZ, which she has been writing for since 2007.

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