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How to calculate SEO keyword traffic value and ROI in five easy steps

January 4, 2022

how to calculate roi on seo

SEO Traffic Value

Understanding the value of a keyword in a search engine like Google will truly compel you to want to implement a strong SEO Strategy.

We know that SEO is important because it has the power to bring visibility to your website but how does it help to score you those all-important conversions?

Let me lay it out very simply.

When somebody searches a keyword in Google, if your website is sitting at the top of the search results, you could very well score that traffic. That traffic could then convert into a lead or sale.

Main benefits of SEO

In a nutshell, implementing SEO well and ranking in the top positions will:

  • Capture people’s attention when they’re searching and ready to buy
  • Increase your ranking and therefore your brand and website visibility
  • Increase traffic to your site with better quality, more focused leads
  • Instil trust in your audience – if Google is referring you, it’s a good sign that other people can trust you too
  • Give you higher conversions rates at a lower cost per lead/sale
seo checklist pdf

But what you really want to know is how much money you will make from a conversion isn’t it?

Let’s calculate your Return On Investment (ROI) from a keyword using an example.

First of all, we need to gather a bit of data.

CONVERSION RATE

Determine your conversion rate for your website, it will usually hover between the 1-3% mark. Most ecommerce sites will be able to find this in the analytics section of their website whilst service-based businesses can calculate this themselves by diving the number of jobs they’ve won by website visits. You can also set up Google Analytics to track this figure using goals.

In the calculation example I will use a conversion rate of 2%.

AVERAGE ORDER VALUE

Determine your average order value. This is the average sales amount across all your customers or clients for the products or services you offer. In the example I will use an average order value of $50.

DETERMINE SEARCH VOLUME FOR A KEYWORD

Gather the monthly search volume for the keyword you are going after using a paid tool like SEMRush or a free tool like Keywords Everywhere. The tools will give you the average number of monthly searches over a 12-month period. In the example I will use a search volume of 1500.

THE CALCULATION

We know the top position in Google generally gets about 30% of clicks. This can vary depending on other factors like Google Ads, the local pack and featured snippets but we’ll go with the average for this calculation.

  1. Determine monthly search volume for one of your keywords: 1500
  2. If the top of position of Google gets 30% of all clicks, then calculate 30% of 1500 = 450
  3. Multiply the number of clicks you would get for that keyword by your website conversion rate eg. Using a conversion rate of 2% – (450 x 2%) = 9
  4. Multiply this number by your average order value (eg. $50) to determine average monthly value of keyword ($50 x 9) = $450
  5. Multiply by 12 (months) to determine the annual value of the keyword to your business: (450 x 12) = $5940

As demonstrated, this one keyword could potentially bring in $450 a month to your business in addition to any other marketing efforts.

THE POTENTIAL

Imagine if you did this for every page of your website?

It is totally worth the time and investment to optimise a page isn’t it?

Seeing the calculations, you may even consider paying an expert to optimise the page for you and you’d still make plenty of money off that keyword. For example, it may cost you $500 to pay a SEO copywriter to write compelling copy for that web page or hire a photographer to take some beautiful photos and you’d still likely come out with $5440 at the end of the year.

Now remember, we don’t want to just rank for one keyword, we want to rank for a whole stack of them which means so much earning potential.

Note: if you’re a service-based business, you may not need high volume keywords if you can only manage a certain number of clients a month as you are swapping time for money.

CONCLUSION

Given the calculation, you can now see why it’s worth considering the value of a keyword to your business before deciding whether it’s the right one for your website. I’m sure you’re now starting to see the value SEO could bring your business and why it should be part of your marketing efforts.

Happy calculating.

ADDITIONAL RESOURCES

Want to leverage SEO or Facebook Ads to generate low cost leads and sales? Here are a few resources I put together to help you:

  1. Download my Ultimate Beginners SEO Checklist

It’s a SEO checklist that will help you get ranking in the top positions of search engines like Google.

2. Join the SEO Made Easy Waitlist

Ready to drive more traffic to your website and boost leads and sales? SEO Made Easy is your step-by-step course to help you generate more profit, make an impact with your business and enjoy more freedom in your life. 

3. Download my 6 Must-Dos for Facebook Ads Success

It’s a practical workbook on the six actions you must take to achieve Facebook Ads success.

4. Have a question, shoot me a message

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