Is SEO Worth The Cost For Small Businesses

Is SEO a Smart Investment for Your Small Business?

This article dives into the world of Search Engine Optimisation (SEO) and helps you decide if it's the right marketing strategy for your small business.

The Power of Ranking High

Imagine the difference between having potential customers find your business easily online compared to struggling to be seen.  That's the power of good SEO.

Calculating the Value of SEO

This section helps you estimate the potential return on investment (ROI) from SEO.  Here's the breakdown:

• Identify Your Target Keyword: This is the phrase people search for that relates to your business (e.g., "digital marketing company").
• Estimate Search Volume: Find out how often this keyword is searched for per month.
• Consider Click-Through Rate (CTR): This is the percentage of people who see your website in search results and actually click on it.  The higher you rank, the higher the CTR.
• Factor in Conversion Rate: This is the percentage of website visitors who become paying customers.
• Estimate Average Order Value: This is your average customer's total purchase amount.

By plugging these values into a formula, you can estimate the potential revenue generated by ranking high for your target keyword.

Example: Ranking for "Digital Marketing Company"

Let's say "digital marketing company" gets searched for 900 times a month.  Here's how ranking can impact your revenue:

• Position #1: Estimated monthly revenue: £13,140
• Position #2: Estimated monthly revenue: £108

The difference is clear! However, it's important to consider:

• Time to Rank High: This can vary depending on competition and SEO strategy.
• SEO Service Cost: SEO agencies typically charge monthly fees.

SEO vs.  PPC Advertising (Pay-Per-Click)

While PPC advertising offers quicker results by placing your website at the top of search results for a fee, the benefits stop when you stop paying.  SEO, on the other hand, provides long-term benefits as your website ranking improves.

Here's a Cost Comparison:

• SEO: Estimated gain by year two: £32,640 (assuming a monthly service fee of £2,000)
• PPC@ Estimated first-year revenue: £675 (assuming you manage the ads yourself) or £175 (using an ad management company)

Making the Decision

By calculating the potential revenue from SEO and comparing it to the cost of services or PPC advertising, you can make an informed decision about which approach best suits your business needs and budget.

Below you will find a breakdown of the figures above:

The Formula:

(Keyword search volume x CTR x Average conversion rate x Average order value)

See the graph for the CTR % you will need to add into your formula:

• "digital marketing company" is searched 900 times per month.
• Average conversion rate of 2%
• Average order value of £2,000 per month
• Target ranking position #1

900 x 36.5% x 2% x £2,000 = £13,140

Here is how you break that formula down:

900 x 36.5% = 328.5
£2,000 x 2% = £40
328.5 x £40 = £13,140

Ready to Learn More?

This article provides a simplified overview.  For further insights, explore our blog for SEO tips and strategies to improve your website's ranking and online visibility.