Why SEO is important for business and how to budget for it

Nov 24, 2020 by Mark Baines Category: Business, SEO

SEO is vital, and the importance of SEO for business has never been more important than in this pandemic economy.

More than ever before, supplier contacts begin with a Google search. If you need any details about an existing supplier, it’s quicker and easier to look on Google than ask a colleague or look on your own Contacts database. Or if you’re considering a new supplier, Google has the answer.

Either way, you’ll know from your own habits that you probably look at Google more often in a day than you look at your lovers eyes! What colour are they? I bet you don’t know. What’s your position on Google? I bet you do know! (If you don’t your missing out on business opportunities, as well as allowing competitors to steal your existing business.)

SEO will help purchasers find you for what you do. It will help your business from being ruled out.

This is why SEO is important for business: there’s a war going on, on Google, and you need to be winning it!

Why SEO and Google is important for business

Google (and the other search engines) attempts to bring fairness to the internet. Its algorithms are written to ensure that the most deserving websites get to the top. They impose a rational order on what is displayed when you search the internet, so people trust them to do it properly and fairly; and they’ve been doing it for many years now, so you can’t really cheat.

This is good news for businesses, because it is usually within their control to ‘earn’ their way to the top of the results pages through proving their worth, relatively cost effectively, and managing their positions. Small companies can compete against large ones, especially on niche search terms, even if they haven’t got much hope against their larger competitors on the more generic terms.

They don’t need to advertise much, if at all.

But SEO is always changing, so it is worth chipping away at it – you can often make surprising gains – and equally fall back down if you’re not actively on the case!

How do you measure the value of Google to your business?

It’s therefore vital to get as high on the results pages as possible, and to achieve this it’s important to have an understanding of how to put a value on relative positions on Google, not least so you know how much budget to allocate to it.

To work out the value of Google, there are some things you can measure with easily available stats, others that require assumptions to be made. However, if you know what you are doing, these assumptions can be fairly accurate and so you will get a clear picture of what your position on Google is worth to you.

For example:

1. Take one product/service type;
2. Choose the top-performing keyword or phrase relating to the product/service
3. Check your average position for that keyword on Google;

So far so good. All of these figures are easily available on your Google Analytics as real, accurate figures.

Now you have to start making ‘educated guesses’: ours are based on much experience, reading and research into business to business SEO results, so we feel they are as accurate as is reasonably possible.

Let’s continue:

4. Positions 1-3 on the organic section of the Google results page receive an average click-through rate (CTR) per ‘Googler’ of 19%;
5. Positions 4-6 on the organic section of the Google results page receive an average CTR of 6%;
6. Positions 7-10 on the organic section of the Google results page receive an average CTR of 3%;
7. Positions 11-20 (ie second page) on the organic section of the Google results page receive an average CTR of 1.4%;

If you have a rough idea of the ‘value’ of a click then with these figures you can calculate the value of your position on Google.

8. For example, if your best search term on Google gets 100 searches a day, and you are always in the top 3 of page one on that page, it will take you 100 -:- 19 = 5.26 days to get 100 click-throughs to your website landing page;
9. If you are always in position 4-6, it will take you 100 -:- 6 = 16.66 days to get 100 click-throughs;
10. Position 7-10? It’ll take you all of 33.33 days;
11. And on the second page? It’s hardly worth doing the calculation!

It’s easy to see that the higher you are, the better your CTR and therefore the greater the value.

So if you sell a service with an average lifetime value of £100K, and you make the assumption that one in a 100 website visitors eventually convert into clients, the value to you per visitor is £1K.

You can then calculate the value of being higher on the page thus:

12. Position 1-3: the value is £100K every 5.26 days;
13. Position 4-6: the value is £100K every 16.66 days;
14. Position 7-10: the value is £100K every 33.33 days and so on.

Now you have a value to put on your SEO, which will make budgeting a whole lot easier to calculate (and justify!).

Simples. Or call Marcom, and we’ll calculate it for you!

With these figures it’s easy to see why companies spend so much on SEO!

Many spend there way to the top, with PPC advertising on Google, but it’s an expensive game: Google’s revenue overtook ITV’s in 2011. Google’s ad revenue in 2019 was $135bn. It’s a game for people with deep pockets. This is as true of B2B as consumer advertising.

Whereas SEO is relatively inexpensive.

Also, many of the activities which make up a successful SEO campaign are best practice and companies should probably be doing them anyway. They can involve everyone in the company, writing blogs and articles and engaging on social media, so they have the added benefit of drawing employees closer to their specialism and demonstrating their skills in these areas.

So much of SEO content strategy and winning backlinks is about educating your market, or demonstrating thought leadership. Your strategy should reflect your marketing strategy, that way every aspect of your work, and your employee’s contribution to that work, is congruent and helps build an irresistible picture for potential clients.

It’s what marketers used to call ‘branding’ – but now it really is winning you business!

Do you want to learn more about SEO? Watch our most recent SEO webinar series here.

We prepared the following session to demonstrate how you can calculate the value of SEO. You can also access the calculator discussed in the video here – SEO Calculator.

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