The Importance of SEO ROI for eCommerce Websites?

The Importance of SEO ROI for eCommerce Websites?

October 17, 2019 Uncategorized 0

 

Business people want to hear how much revenue they stand to generate, instead of how you would increase their organic sessions, no matter the value of such metrics. One of the reasons is that they invest in SEO and if they do not get sales and revenue, instead of income they lose their investment as well.

A good idea for avoiding this situation is monitoring and calculating the ROI based on SEO or other strategies. Calculating means:

–       Understanding traffic based on integration of SEO tactics;

–       Making parallels between sales and strategies;

–       Calculating the SEO-based revenue.

This will give you an idea of the effectiveness of your SEO strategies and better determine your marketing budget. Luckily, we’re breaking down how to generate business revenue from SEO investments. Using metrics such as projections in ROI are as effective as those that directly translate a business investment to revenue.

ROI Estimation for eCommerce Without Numbers

Before getting to the ROI of eCommerce search engine optimization, it’s essential that you calculate the opportunity for ranking in a specific keyword. Using tools like the almighty Google Keyword Planner or SEMRush, you can discover valuable keywords to target, based on search volume, competition, and what your competitors are doing (SimilarWeb and BuzzSumo are excellent). This, of course, we do after reviewing the present and historical performance of their website.

In this extensive process, we use several tools and calculations to deliver to clients estimated ROIs that are most times accurate. However, you can see that without including figures, we can’t even call this ROI.

Most clients you speak to like to talk about money. The next method I will explain below shows a better way, in my opinion, of presenting data using accurate projections based on your current and past results.

Challenges of ROI

eCommerce digital agencies invest heavily in advertising, and that is not changing any time soon. These funds are pumped into this avenue because before making the commitment, managers have a clear picture in their head of how much money their investment will yield in a specific period. Search engine optimization is a whole other ball game when calculating ROI. It can be a little challenging when understanding the cost and revenue, especially for larger businesses. The reason is that their ROI formulas are a little complicated. Besides, it is not a fast process and it will take some time to understand how promising the campaign is in terms of profit.

 

ROI Estimation for eCommerce With Figures

The method I’m about to introduce to you is not a prophetic technique but a mere statistical application that helps put your work quality into perspective for prospective clients. This way, the traffic numbers have a better understanding as to what traffic means to their growth.

For eCommerce search engine optimization, the most crucial factors are the revenue generated from organic search engine traffic, as well as the revenue got for every user session. We’ll use random figures to illustrate this method.

Below are the numbers of our example eCommerce digital agency, FakeShop, Inc.:

 

Organic traffic sessions for prev. year

Organic traffic session per month

600,000

50,000

Revenue prev. year

Revenue per month

$24,000,000

$2,000,000

 

These types of numbers would likely be readily available from the eCommerce store. Using them, you can make an informed prediction on how much they would make monthly with a fewer or higher number of sessions from search engine traffic.

No. of Sessions Increase in Sessions/Month Projected Organic Revenue Increase in Revenue/month
Present 50,000 $2,000,000
10% increase 55,000 5,000 $2,200,000 $200,000
20% increase 60,000 10,000 $2,400,000 $400,000
30% increase 65,000 15,000 $2,600,000 $600,000

 

We picked ten to thirty percent increases in our example, but you could go even further. Without using proper amounts as we have done above, an eCommerce marketing service agency would make statements like ‘by investing $X, we expect a 30% increase in the average number of website sessions from organic traffic.’

Why do You Need it?

Using this technique, however, helps link the various eCommerce search engine optimization metrics to actual revenue, which is what resonates most with decision-makers of the eCommerce digital agency and gets your proposals approved faster.

Including tables such as the above in your ROI estimations means that if you make the same statement (‘by investing $X, we expect a 30% increase in the average number of website sessions from organic traffic’), anyone can know that 30% increase means their revenue will increase by $600,000.

What is More?

ECommerce marketing services should obviously not follow this method religiously because of the dynamic nature of eCommerce search engine optimization. Some unexpected issues mean that your sessions may not convert today as they did a month ago. Among these issues we can outline:

  1. Keyword relevance changes;

Google continually announces updates in its algorithms and keyword updates are no exception. Keyword planner by Google helps to choose new ideas when planning out your search strategies. However, updates by Google should be taken into account to make sure that you keep your “search relevance” and your website will not be penalized.

  1. Google algorithm changes;

Google search algorithm changes will impact your ranking and ROI if you do not adapt your SEO strategies for it. While most of the changes seem to be minor, they can impact on your ranking. Hence, it is a good idea to prepare your website for these changes.

  1. New Marketing trends;

Every new coming year, a business or a marketing expert bring new ideas which become a key success to them. Following these trends are important as they can bring you many advantages. For it you need to get informed of industry influencers and make up-to-date industry research. Besides, you can make a competitive analysis to find out which works for others and integrate them in your strategies.

However, business revenue generation is a numbers game, and you won’t want to contest in this battle of numbers without being armed.

 

 

Author

Tigran is a marketing and creative content specialist at Smarketa.com with a primary focus on SEO, PPC and customer satisfaction for eCommerce business. Being a true humanist he draws inspiration from the simple thing as everyday life and the matters one come across on a daily bases doing his best and above to help everyone around.

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