How to Report on SEO ROI in a Way C Levels Can Understand

SEO specialists are constantly caught between a rock and a hard place.  We’re torn between explaining the value of our efforts without overpromising.  A little too vague, and SEO campaigns are seen as ineffective.  Too specific, and the vagaries of search algorithms can make meeting target goals impossible.  

To complicate matters, often the C levels determining SEO budgets are at least one degree (and often times several degrees) removed from the direct line of communication, and have little to no understanding of the metrics that truly indicate results.  While education is an important component of any SEO engagement, so is conveying appropriate information that proves SEO benefit regardless of audience, and leads to larger budgets. 

Establishing Value and Determining Conversions

The first question that should always be asked (besides what’s the budget) is what is the goal of the campaign.  Without a clear understanding of what a client is trying to achieve, proving results will be impossible. 

In many cases, clients will have different preferences for branded vs. nonbranded traffic, different profits per conversion for different verticals, and different ideas about lifetime value of a customer.  Often, these ideas vary even within the client’s company, so establishing firm values (as much as possible) for goal metrics is a critical first step for proving SEO value, and will ultimately be determined by the C level in charge of budget. 

The goals you agree upon should be integrated into analytics to ensure they are properly tracked, with ecommerce tracking being an essential implementation where applicable.  Some SEO agencies overlook the importance of an Analytics audit, but if we are going to be accountable for results, we should also make absolutely certain we are tracking metrics correctly. 

Rankings: Quantitative Assessment

Then there are the clients that are either unable, or unwilling, to set firm goal values.  Nevertheless, estimating ROI for SEO can be very useful, even if it’s not 100% predictive. 

For years, SEO specialists have pointed to rankings as proof of success.  And it makes sense, often clients come to us with specific rankings they care about, or ask to rank “ahead of that guy”.  However, we have also known that rankings alone are fairly meaningless.  Whether the rankings are purely vanity rankings, and drive no significant traffic, or they miss the target market entirely and fail to drive conversions, a rankings increase or decrease should not be the final measure of SEO success.

However, the importance of improving particular rankings can still roughly indicate value by including a few more factors.  This is most important for clients that are on long cycle on page implementation and require a lot of off page efforts to see any effect.  Demonstrating the value of improving rankings is a great way to retain interest as rankings improve slowly. 

First, the goal ranking position should be determined. Next, your current conversion rate for the particular keyword should be determined, as based on the goals established in the initial phase of the engagement.   The goal value should be applied to this conversion rate, and the estimated traffic for that keyword applied to the total.  The whole equation looks like this:

Organic Conversion Rate of keyword X Goal value X (CTR at that ranking X Total Traffic for that keyword) = Total Organic Value of Keyword at that Ranking

For example, let’s say a client wants to rank #1 for “dog beds”.  This organic keyword has a conversion rate of 2.31% and a goal value of $45.00.  According to Slingshot SEO’s Google CTR Study, the average number 1 position has a CTR of 16.9%.  Local monthly search is 110,000. 

2.31% X $45.00 X (16.9% X 110,000) = $19,324.31

By summing the top organic keywords driving traffic, and dividing by SEO budget, a compelling SEO budget argument based on ROI is born.  Obviously, this is a ROUGH estimate.  Yes, things like CTR and monthly traffic are variable, phrase vs. exact match can skew your results, and the percentage of traffic going to a particular ranking is a best guess that will change over time. However, sometimes a quantitative measure relating directly to profit is the only way to help a C level executive make a decision about SEO ROI. 

While the biggest concern for providing ROI numbers can be going too far and setting false expectations, in reality the ROI calculation above can be presented in the same way that any market forecast would be. 

Using Google Insights to predict future market trends in total search volume can also help set expectations. Pointing out that the value calculated for only one head term leaves out the value presented by the likely ranking for longer tail variations also can prevent accusations of inflation. 

Exhibiting the opportunity SEO presents in an intuitive format is an easy way to increase budget, as long as you can keep the traffic you are getting engaged and converting

Site Visitors: Qualitative Assessment

Just as important as predicting future value, is indicating current success.  While the most straightforward measurements are derived from establishing goal values and demonstrating conversions, often site engagement can be an important aspect of a SEO campaign. 

While site engagement is often overlooked and under-valued in the SEO community, it can actually be an important metric for branding oriented and B2B clients. Again, establishing baselines and goals based on client expectations tempered with industry averages is an essential first step.  Tying metrics such as bounce rate and time on site to conversion rate establishes the importance of visitor engagement, and when interpreted on a granular level, can suggest CRO testing or additional on site content. 

Stop Thinking Like An SEO Consultant

SEO specialists are enamored with interpreting data.  That aha moment when you realize why a particular site is being penalized, or identify a huge opportunity based on competitive analysis is the bread and butter of our day.  And of course we want to explain every minute detail of how we arrived at our game-changing conclusion, because to us, it truly is equivalent to an epiphany. 

However, C levels tend not to care about the subtle details of metrics.  They care about results.  If you are lucky enough to encounter a C level whom has an interest in the workings of SEO and truly becomes involved in the campaign, you are free to demonstrate how what you really want to look at are assisted conversions, where their link profile is lacking, or the best techniques for optimizing a YouTube video. 

If however, you are removed from even talking to the people controlling the SEO budget on a regular basis, that tight rope walk between a high level presentation and not providing any relevant information can end with no budget at all. 

So put results in terms C level decision makers can understand; revenue, profit, value per visit, and yes ROI. Tie the SEO campaign into the larger business strategy, and use proof points that pertain to organization wide goals. Prove your case, show how the market is becoming more competitive or demonstrate missed opportunities, based on factual competition and trend data, and ultimately increase your budget.