Setting a Budget
How do you construct a SEO budget without knowing projected costs? Is it even possible to calculate a return on investment with accuracy?
People shop online. They watch TV shows. They even order takeout online. Consumers are spending millions of dollars online. Customers find businesses through search engine queries, yet budgeting for SEO is still underutilized.
An SEO budget is necessary to tap into that lucrative online market. Still, the process is not as simple as – spend more, make more. We at Internet Marketing Team understand that dynamic all too well.
Tapping into the true potential of your SEO success, like most business decisions, is about strategy. The same cost benefit analysis model from business school applies to SEO.
How do you balance your SEO budget, realize your ROI, and not pay too much?
Return on Investment
Return on investment (ROI) is common enough in business, yet it is has underused purpose in SEO. ROI means that the amount of money and effort put into a project is equal to or less than the profit realized. In essence, you want to spend as little money as possible to achieve the best results possible.
ROI is a potential tool for SEOs. Still, budgeters often find using ROI in the SEO context problematic. After all, how are you supposed to calculate a number based off user behaviors on a search engine?
User behavior is not always quantifiable. Sure, you could judge a budget based off number of clicks. What about time on screen, industry trends, and other factors? Clicks on a link does not always equal dollars spent at a company (not counting ad revenue).
Bottom line – an SEO budget is not an easy task. Regardless of what you may have read online, setting up a budget for SEO is difficult. In all fairness, setting up ANY budget is difficult. It is impossible to predict the future.
Fashion companies can only predict fashion trends for months in advance. They cannot guarantee. There is no accounting for the latest celebrity setting a new trend. Likewise, there is no definitive way to establish how much a company needs to spend on SEO. Marketing is often unpredictable.
SEO budgeting is messy, but there are ways to contain it.
Strategies for Managing the Mess
Any budgeter worth their salt knows that blind application is a waste of time and effort. You have to make assessments before plugging ahead with a budget. This is another reason why SEO budgeting is messy. It takes time to make all the necessary assessments such as: self-assessment, industry standards, and local practices.
First, a company must ask themselves a series of questions. Then, determine how much you can spend. You may not need that full budget, but it could be helpful to work back from the number. If you know the limit, you can make rational decisions on what is most important.
In that same vein, a company needs to determine their goals. Is your goal to rank on the first page? Are you looking to generate revenue? What are the keywords for your area/niche? Is there any current data on ROI from a preexisting SEO budget?
Make the assessment, then make the analysis.
You have keywords available. You know the most clicked keywords for a particular niche. To optimize, take these figures into consideration. Blind application of keywords is not effective – as per Google guidelines.
Instead, you have to determine which keywords will provide the most return. Calculate which keywords will draw in the most business. Once you have done that step, make sure it is worth spending that much money.
For instance, it may cost $10,000 dollars to boost your page to the first page of the SERPS. Meanwhile, your budget may be $30,000. Make sure that a particular keyword will bring you the most money. It may not be the best idea to spend 1/3 of your budget on a low-selling item.
Make the analysis and determine the cost/benefit of your choices.
Handling ROI for Someone Else
If you are a SEO, you might be wondering how to explain the necessity of a SEO budget to your boss or client. Bosses and clients are notorious for low patience and busy workloads. How do you convince them of the need for a budget without it going over their head?
First, keep it simple. It is always good advice to keep it to the facts when pitching a delicate concept. This is especially true for complicated concepts like Phoenix SEO. Find a simpler way to explain it. The more intuitive the idea seems, the more your boss/client will find it agreeable. Even with the popularity of online searches, some people cannot let go of the old means of advertising. They need a little convincing from someone knowledgeable.
Also bear in mind that the bottom dollar matters. Have numbers in hand. Even if those numbers are conjecture, boss/clients respond better to numbers. A low figure is a safe bet in case you are uncertain of the possible ROI. It is the cherry on top for boss/clients if returns are higher than promised.
While a low figure can look better, don’t make up numbers. You will not fare well if you cannot meet promised expectations.
Proving SEO Value
There are other ways to convince someone to rework or even implement a SEO budget.
Like the “keep it simple” standard, define a clear focus. The upper echelon respond better to specific target areas of improvement. Likewise, make sure that you focus your metrics. If you are using industry standards to come up with a number or metric, share that fact with them.
Prepare for Anything
Know your weaknesses and address them outright. Admit that a particular number or metric could be wrong. Admit the potential fault and counter with the why and how. Address why you went with the uncertain decision. Then address how you are planning to mitigate the potential risk of the uncertain number or metric.
Likewise, come out in front of the risk. If there is too much risk of loss, the automatic response of management is to run. Come prepared to soothe concerns over the potential risks. This is where you drive home your plan to mitigate the problem.
Mitigate the risks. Drive home the ROI potential.
Be Honest (and Tough)
Despite your best efforts, there is that one manager in the corner who always has a snarky remark. They do not see the benefit of a SEO budget or even the purpose of it. Be calm and prepared.
Hit them with the worst in your arsenal – tell them a SEO horror tale. If they know what could cause serious harm to the business, they might be more willing to listen.
Return on investment is not easy. SEO, in the ROI sense, can be a difficult road to manage. For this reason alone, many budgeters outsource SEO duties to third party companies. Third party companies have the knowledge and expertise to handle difficult SEO budgeting.
Consider these factors when deciding on a budget for client’s SEO plan. The best advice is to prepare yourself and keep it simple.