Look, digital marketing spend has grown exponentially since the pandemic.
You’re likely to allocate some of your marketing budgets towards SEO efforts. But determining the appropriate amount to invest in SEO can be challenging.
Fear not, you’re not the only one facing this dilemma. For a lot of businesses, digital marketing is their main promotional avenue. Yet, numerous company leaders still struggle to allocate sufficient funds for online marketing campaigns.
Similarly, it’s a tough task for service providers to create effective strategies and assign appropriate pricing.
Ultimately, it boils down to your website’s competitive standing. Assessing your current position and desired progress rate are crucial factors in deciding your SEO budget.
A recent study revealed that fewer than 50% of small businesses allocate any budget to SEO. Among those that do, they typically spend just under $500 per month.
As it turns out, SEO is an area where you genuinely receive the quality you pay for.
Companies spending over $500 per month are 53.3% more likely to report being “extremely satisfied.”
Is it any wonder that numerous entrepreneurs hesitate to invest in SEO? Most lack a thorough understanding of search marketing and are preoccupied with running their businesses to devote time to learning SEO.
In the majority of businesses, there’s a standardized, step-by-step method to progress from one stage to another.
Many people mistakenly believe SEO functions in the same way, treating it like a commodity, and falling prey to the “$99/month, guaranteed page one” fraudsters.
What is the cost when SEO is done badly?
As a member of several online marketing groups on Facebook, I’ve seen countless newcomers posing as SEO experts and accepting clients.
It’s not rare to see questions like: “I just secured a client who wants to rank for [keyword x] – how do I achieve that?”
Another frequent issue is the use of link-building schemes, especially Private Blog Networks, without disclosing the risks to clients.
If entrepreneurs were only wasting money by hiring unskilled SEO practitioners, that would be bad enough. Regrettably, the fallout from “low-cost SEO” can extend far beyond that.
It may result in a Google penalty, virtually eradicating a website’s online visibility.
Business owners must remember that they are ultimately accountable for any SEO work done on their websites. They ought to discuss specific tactics before entering into any agreement.
Managing your SEO assets
Considering that Google employs over 200 (and potentially many more) ranking factors, it’s natural to feel overwhelmed.
Fortunately, focusing on just three aspects can lead to success, regardless of your niche.
Pay attention to these key elements:
Ensure your website:
Is crawlable and accessible to search engines.
Adheres to Google Webmaster Guidelines for SEO best practices.
Is optimized for excellent user experience (with particular attention to Core Web Vitals).
Displays cleanly on mobile, tablet, and desktop devices.
Your website’s content should adhere to the best practices outlined in the Search Quality Ratings Guidelines, emphasizing:
Uniqueness and value.
Relevance to search queries.
Meeting user intent.
Compliance with the fresh content algorithm.
Aim for organic backlinks. Steer clear of common link-building schemes like PBNs and paid guest posts. Instead, concentrate on acquiring genuine links that improve SERP rankings.
Quality is crucial:
A smaller number of high-trust/high-authority/relevant links can outperform a larger quantity of lower-quality links.
Always measure outcomes
Before deciding on a budget, it’s crucial to set specific objectives for your campaign.
Your objectives should comprise quantifiable outcomes, a set time frame, and a clear standard for success.
In the past, keyword rankings were the sole measure of success. While search engine rankings are still significant, they aren’t the ultimate indicator.
Arguably, the most crucial metrics are those that directly impact your bottom line, such as organic sessions, goal conversions, and revenue.
Goal setting might involve increasing organic sessions by a certain percentage, boosting conversions by a specific number per month, and/or raising revenues by a certain percentage.
When setting objectives, bear in mind two essential aspects.
First, your goals should be attainable. Ambitious targets are acceptable, but unrealistic expectations can be counterproductive.
Equally important, allow sufficient time for the campaign to yield results.
Google states that SEOs typically require four months to a year to implement improvements and observe potential benefits.
Creating a SEO budget that works
Your objectives will dictate the strategies needed for success, which in turn will establish a framework for developing an action plan and the required budget.
This returns us to the initial focus on positioning and considering factors that influence outcomes.
How does your website’s structure compare to your competitors? How does your content strategy measure up against your competition? How does your backlink profile fare compared to top-ranking sites? The responses to these questions will determine your priorities and the amount of work required to achieve your goals.
In many instances, the actual tasks will remain the same, regardless of the budget. The difference lies in the volume of work carried out.
A higher budget allows for more content and links, increasing the likelihood of achieving success sooner.
Nonetheless, the ideal budget is one that you can comfortably maintain for at least six months, preferably a year.
Proper planning, implementation, and adjustment of a campaign take time to evaluate success.
Also, remember that a smaller budget will likely result in a longer journey.
What should you look at spending on SEO?
If you’re engaging a top-tier SEO firm for a local campaign, expect to pay $500 or more per month.
A national or international campaign necessitates a minimum budget of $2,500 to $5,000 per month.
Some agencies offer a no-contract “trial package” at a reduced price, allowing potential clients to assess their services while minimizing risk.
If retaining a top-level SEO professional isn’t feasible, there are alternatives. One common option is a one-time website SEO audit with actionable suggestions.
Simply rectifying your website can often lead to a significant increase in organic traffic. You can also seek one-time fixed-rate assistance from an expert for content development and keyword analysis.
Another alternative is to become proficient in SEO and manage it yourself.
The SEO ROI & Cost Calculator
Total monthly SEO revenue: $
Total average lifetime SEO revenue: $
ROI from SEO budget: %
How to use the calculator
The calculator works by taking your gains from implementing SEO and using your estimated budget to calculate an ROI.
SEO is a naturally high ROI channel, albeit one that can take a bit of time to implement.
In the calculator, you’ll need to input the following details:
New customers per month (from SEO)
This is the number of new customers you expect to get each month from implementing your SEO strategy. You can estimate this yourself by looking at keyword data, or you can ask your SEO agency directly.
Avg monthly income per customer ($)
This is a simple calculation of how much each customer is worth to you per month. If your business model is based on MRR, this would be the monthly figure. If you are SaaS, it would be the monthly fee.
Number of months each customer is active on average
This is simply the length of time that each customer stays with you on average.
Monthly SEO budget ($)
Your estimated monthly spend on SEO. Remember to include consultancy fees, links and any other associated costs with SEO.
How to understand the results
Total monthly SEO revenue
This is how much revenue, on average, you will generate from SEO in a given month.
Total average lifetime SEO revenue
This is the total amount you will be getting in revenue from each customer.
ROI from SEO budget
As we discussed in this post, this is your ROI from your estimated investment into SEO. This is based on your LTV from new SEO customers and the revenue they will bring to your business.
There you go; now you can justify your SEO budget and take the metrics that matter to decision-makers to secure investment in your SEO project.