As a white label SEO reseller, you already understand the value of search engine optimization. But to the average business owner, SEO can feel a little like climbing Mt. Everest. Who’s to say whether they’ll ever reach the top? Or whether it’s even worth trying?
Fortunately, the numbers don’t lie. If you want to learn how to sell SEO more effectively, you’ll want to highlight those numbers and help your clients understand the true ROI of SEO.
But in a field that’s known for its variability (and even volatility), it can feel nearly impossible to pin down a specific figure. With our step-by-step guide, you can easily answer the “what is the ROI of SEO?” question and convince your clients that there really is a return on investment at the end of their long climb.
Why the ROI of SEO Matters to Clients
We all know the old adage: you’ve got to spend money to make money. That second part is non-negotiable, though. If you don’t see monetary gains for the time and money you’ve invested, it’s hard to make a business case for it.
Demonstrating the value of SEO is particularly important. Search engine optimization is an unfamiliar concept for many business owners. They might not have given much thought to how Google determines which search result shows up first. And if their expectations aren’t realistic from the outset, they might assume SEO isn’t worth it.
With any type of digital marketing, your client is taking a leap of faith. Because SEO is a long-term strategy, you need to prove the value of SEO over time in order for them to feel comfortable making that investment. While we can never make any promises as far as results go, we can give them a good idea of what they can expect throughout the run of an SEO campaign.
The Challenges of Measuring the ROI of SEO
SEO is complex, so it takes time to understand even the basics. Making matters more complicated, the results of SEO aren’t as easy to measure or as immediate as those of an ad.
Still, there are some similarities in how we calculate return on investment. Finding the ROI of SEO involves the analysis of click and conversion rates, just like with ads. But while you can access certain information through Google Search Console, you’ll just have to dig a little deeper (or work with a reliable white label SEO partner like Semify) to get all the data you need.
Additionally, clients will have to stay the course to see a positive ROI with SEO. A Google Ad will yield instant results, but most experts agree that it typically takes at least three to six months for an SEO campaign to really take off. That requires even more faith (and more data to back up your claims). You may also have difficulty proving a cause-and-effect relationship when an SEO campaign is running concurrently with other marketing efforts.
So how can you convince a client that SEO will pay off? While there’s no average ROI of SEO that can be applied to every campaign across the board, Semify’s ROI of SEO calculator method can help you estimate how real results will play out and allow you to set clear expectations with clients for the long term.
How to Measure the ROI of SEO
Like the name suggests, Semify’s ROI of SEO calculator is meant to help you compute the approximate return on investment for a given SEO client. Their ROI will depend on a number of factors, including the keyword and its ranking in SERPs, the keyword’s click-through rate, the website’s conversion rate, the client’s lifetime customer value, the length of the campaign, and more.
We’ll show you how our SEO return on investment calculator works, step by step, using an imaginary dental practice as an example. When we’re through, your clients will see that SEO offers something to smile about.
Step 1: Select Your Keyword and Desired Ranking
SEO success starts with choosing the right keywords. After your white label SEO agency performs keyword research for your client, you’ll determine which search terms to target to achieve your client’s goals.
Search volume plays a big role here. While a keyword with a high search volume indicates there’s a lot of interest in the term, that doesn’t mean it’s the most relevant for your target audience. An overly broad term like “dentist” has a monthly search volume of more than 300,000, according to SEMRush. But that doesn’t mean your dental client will get 300,000 new customers by optimizing for that keyword.
Broad keywords like this are almost always going to be highly competitive. You’d probably have to spend millions of dollars to rank on page 1 of SERPs. And even if you managed to accomplish that, you’d have trouble reaching your target demographic. It’s simply too general.
Ultimately, that means you need to choose a target keyword that’s popular enough to yield searches but isn’t so common that you sacrifice search intent. In our example, we’re using “dentist rochester ny.” Since our imaginary dental practice client is located in the Rochester, NY area, they’d obviously like to reach patients in and around this location.
Is this search volume significantly lower? Yep. But it’ll take a lot less time and money to rank on this keyword – and it’s actually more valuable to the client!
In terms of overall keyword competitiveness, this will largely depend on the industry and location. The dental industry is designated as being “moderately competitive,” according to DentistryIQ. Because the industry is fragmented, with many dentists cornering a particular market or specialty, this provides an opportunity for dental practices to stand out in search.
Keep in mind that service-related keywords can increase your reach. Specifying the type of dentistry or dental services offered (such as pediatric dentistry) in combination with location can target users who are more likely to become patients.
If you’re already ranking on the head term, those long-tail keywords will be even easier to win – potentially allowing your client to rank on dozens or even hundreds of other relevant search terms and maximize eyes on your site.
Assuming that your client’s site is properly optimized for the keyword you’ve chosen, they’ll eventually start moving up the ranks in SERPs. When someone enters that term in the search bar, their site should show up in organic search results.
For the purposes of this example, we’re focusing mainly on page 1 rankings of SERPs – meaning position 1 through position 10. A client may not begin their campaign by ranking for a keyword on page 1 (and may not even get there for several months!), but that’s the eventual goal for most businesses – and you’ll see why below.
Step 2: Determine Click-Through Rate (CTR)
Your ranking in SERPs has a monumental impact on your click-through rate (CTR). CTR refers to the percentage of people who perform a relevant search and then click through to your site.
In general, the click-through rate for a client that has just started an SEO campaign is going to be pretty low or almost non-existent. Why? Because users rarely click past the first page of search results. And the further down the first page you are, the fewer clicks you’re going to get.
- The first organic search result is 10 times more likely to be clicked than the 10th result
- The average CTR for the #1 result is between 25-30%
- The top three search results receive about 50% CTR combined, on average
- The CTR of spots 8-10 is essentially the same, ranging from 2.4-3.3%
For our calculator, we’re using SISTRIX data to calculate the estimated CTR based on ranking position. Their study analyzed 80 million keywords and billions of different search results. The table below outlines their findings related to Google ranking and CTR:
It’s clear just how sharply the CTR shifts even between those first few rankings. So how realistic is it to snag that number one spot? That depends on a number of factors, including keyword competitiveness. Unless your client is already ranking on their desired term, it’ll take several months to see movement. But once they make it onto page 1, you’ll see a CTR that’s better than average. Helping your client choose the right keywords can make or break their ability to rank and receive clicks.
Step 3: Define Conversions and Site Conversion Rate
In general terms, a site conversion is defined as someone coming to a website and completing a desired course of action or behavior. For some businesses, that might mean filling out and submitting a web form. For others, it may involve calling the business or even completing a purchase. It’s essentially up to the client to define what conversion means for them.
It’s not always easy to track conversions specifically stemming from SEO. You can certainly accomplish this in Google Analytics, but widespread data reports on this topic are few and far between.
For the purposes of our ROI of SEO calculator, we’re using data from a 2021 report that analyzed conversion rates according to traffic source. The report segments 8 different traffic sources using Google Analytics, based on more than 150 SEO campaigns between 2016 and 2021. For B2C client SEO, the average conversion rate was around 2.6%. Notably, this data shows that SEO provides the highest conversion rate of any other marketing or lead generation channel.
For the purposes of our example, we’re defining a conversion as a scheduled appointment. According to DentistryIQ, the typical conversion rate for a dentist is somewhere between 1-2%. We’re choosing to give them a slight boost in our example, but you could also be more conservative for the sake of expectation-setting with a client.
Once you understand how your client defines conversions, you can track their exact progress and see how it measures up to the industry standard. You may need to look into conversion rate optimization if your client is already ranking well but isn’t seeing a great CTR or conversion rate.
Step 4: Enter SQL Closing Rate and Account for Anomalies
When figuring out how to measure ROI of SEO, you’ll also want to determine your client’s sales qualified lead (SQL) closing rate and include that in your calculations. Since many businesses define conversions and sales as two separate entities, you’ll want to figure out how many qualified leads actually make it all the way through the funnel to become customers or clients.
For our dentist example, we’re defining a conversion as a booked appointment. But is our conversion rate the same as our SQL closing rate? Not quite. We’d equate our SQL closing rate with the number of patients who actually show up for their scheduled appointments. If a patient has a scheduling conflict with their appointment time and doesn’t end up rebooking, for instance, they wouldn’t count towards that closing percentage.
One study found that their data set of over 73,000 healthcare appointments in underserved communities had a 16.7% missed appointment rate. For the purposes of our example, we’re rounding up our hypothetical dental practice’s SQL closing rate to 85%.
The typical SQL closing rate will highly depend on the client’s industry, location, and sales practices. Keep in mind that a more “traditional” SQL close rate (involving the detailed qualification and closing of leads) will usually yield lower numbers. FrontSpin data suggests that the average closing rate for sales qualified leads ranges between 25% and 35%. Once you chat with your client to learn about their SQL close rate, you can enter that data into the table.
Step 5: Add in Lifetime Customer Value and New Sales
Monthly new sales and lifetime customer value are two other metrics you’ll need to include when you’re measuring the ROI of SEO.
Let’s talk about the lifetime value of a customer first. LVC can tell you a lot about how much your customers are worth (and whether you’re over- or underspending to acquire them!). Many businesses will use the $10,000 mark as a solid estimate, so that’s what we’re using as the default in our example. But Semify’s free LVC calculator can help you get an even more accurate idea of your client’s average lifetime customer value.
Dental experts cite that the average lifetime value of a patient might hover a bit higher than that, ranging from $22,000 to $45,000, which means we’re actually underestimating in our example. The more your potential customers are worth individually, the further your marketing budget will go. Because SEO is more affordable and often yields better leads, a higher LVC will correlate to a higher ROI.
As for monthly new sales, we’ve made it even easier for you to get the data you need. Our ROI of SEO calculator will actually estimate the number of new customers per month for you based on the other metrics entered. Your client’s keyword ranking, CTR, and conversion rate all impact the number of new sales they acquire each month. As you toggle the keyword ranking, you’ll see that it directly impacts your new sales number.
Step 6: Adjust Your Monthly SEO Spend
Here’s where expectation setting becomes crucial to maintaining client satisfaction. SEO takes time – which means that your clients will be spending more on SEO than they’re getting back during the first few months. That said, increasing a client’s monthly SEO spend will eventually improve their returns. Being able to illustrate the ROI of SEO upfront can alleviate hesitation.
In our example, we’ve set the client’s monthly SEO investment at a fixed rate of $2,000. Your own client might have a different budget to work with. But no matter how much they’re initially spending, clients should expect to see a negative ROI in months 1-3. They might even see negative returns through month 6. Although increasing their SEO budget will pay off over time, they won’t immediately speed up results just by doubling their initial investment.
That might sound discouraging, but framing SEO as a slow burn will help. And the more you invest early on, the stronger the campaign will be later. By months 3-6, many clients should at least come close to breaking even. Some will even start to see some modest returns, depending on their location and keyword competition. In months 6-12 (and certainly by months 12-18), their SEO return on investment really takes off.
As you can see in our example below, our imaginary dental client starts off in position 40 for their desired keyword. Since they begin their campaign on page 4 of SERPs, their click-through rate will be nearly non-existent. They may still bring in leads and customers during this initial period (especially if they’re also running PPC ads!), but these first few months are meant to build a strong SEO foundation for the future.
By month 3, we’re seeing some modest improvements. Our client isn’t ranking on page 1 yet, but they’ve jumped 14 spots to number 26 in SERPs. Their ranking continues to steadily improve in months 4, 5, and 6. We can see that their click-through rate is also improving, though it’s still got a ways to go. Although their ROI is still in the red, the client would also start to rank on other long-tail keywords during this time. They’re likely getting other wins that aren’t reflected in this single keyword ranking.
Now, let’s take a look at months 7-12. In the snapshot below, you’ll see how the client's $2,000 monthly investment begins to show major returns. They're now appearing on the first page of SERPs for their desired keyword. Before the end of their campaign’s first year, they’ll have made back their initial SEO costs – and then some.
And as we get into months 13-18, those returns only start to grow. Even as the client's ranking position fluctuates within the first few spots (which can and does happen for any number of reasons), their impressive ROI is still undeniable.
While there are no guarantees with SEO, we’ve developed these example figures based on our experience and industry trends. One thing we know for sure: with SEO, slow and steady wins the race.
Learning how to sell SEO effectively involves showing clients that their faith in your services won’t be misplaced. If they stay the course, their investment will pay off.
Step 7: Get Ready to View Your Month-to-Month ROI
Now you should be ready to enter your own client’s figures and view their monthly estimated ROI of SEO. You can use Semify’s ROI of SEO calculator tool to show your clients what they stand to gain from their investment. Just click the button below and make a clean copy to use as your calculator template.
In our month-to-month example, you’ll see how drastically the value of SEO and the client’s ROI increases over time. By the 18-month mark, our imaginary dentist has invested $24,000 in SEO services – but their ROI from SEO is nearly $90,000!
This isn’t to say that every dental client will quickly climb the ranks and dominate the SERPs within a year. But as the Semify dentist SEO case study shows, major ranking improvements can occur in less than 6 months. Seeing how their ROI of SEO can grow over time can convince clients to stick it out, rather than jump to conclusions and abandon ship in month 2 or 3.
Sell Your SEO Services Using Semify’s ROI of SEO Calculator
Some clients might wonder, why use SEO at all? Is it even worth my time?
Convincing clients of the value of SEO becomes much easier when you have the hard data to back it up. Our ROI of SEO calculator can help you sell SEO more successfully by highlighting its value and setting a realistic timeline. You can make a blank copy for yourself to use as a template for every prospect.
Of course, as your white label SEO program partner, we’re here to help. Whether you need assistance in determining these values or want coaching in how to approach your next sales call, we’ve got your back.
To learn more about joining our white label SEO program and how to sell SEO to clients, get in touch with our team today.