The True Value of SEO (and Its Relationship with SEM)
As more and more companies shift the focus of their marketing efforts to digital, much of that budget is being invested in SEO.
While digital marketing definitely has an edge over traditional marketing channels in its ability to measure just about every aspect of a campaign, it’s easy to get carried away with watching your analytics account.
When the focus is on SEO, your investment is of a long term nature. Logging into your analytics account multiple times per day may lead you to feel underwhelmed with the progress that’s being made.The reality is that there is almost always a ramping up period; a time frame where your site is playing catch-up to competitors and earning the traction you want to have down the road.
While you may see some initial spikes in traffic after implementation, the true value of SEO usually shows itself months down the road. That’s not a deflection or a shirking of responsibility for the time in between – it’s simply a product of how search engines work.
This is decidedly different with pay-per-click (PPC) campaigns, where you can calculate your ROI based on your ad spend on a daily basis and make accurate predictions as to what levels of traffic you’ll see.
Let’s take a look at an example:
- A company is paying $2.00 per click for a certain keyword, while conversions for that keyword give their visitors an average order value of $3.00.
- In other words, each visitor that enters the website is worth about $3.00 on average. The company is making $1.00 in profit per visitor.
- With PPC, they’re making a positive ROI and all they need to do is keep buying clicks for that keyword.
Imagine getting the exact same traffic without the $2.00 cost per click. Rather than a profit of $1.00 per visitor, they’re earning $3.00 in profit. This is the true value of SEO; traffic that is highly relevant to your business – but without the consistent ad spend.
Now, the reality is that it’s not so simple. Unless you’re an SEO expert doing work on your own websites, there will still be a monetary cost to doing SEO. What the example above illustrates is that in the long run, when your SEO efforts truly begin to pay off, the costs of traffic dip substantially, whereas the costs of traffic coming from SEM stay as a straight line (and will likely increase over time due to cost per click inflation).
SEM is a highly effective way to gain immediate traction for high converting keywords. On the other hand, SEO is a very effective means of securing that same traffic for lower costs once your website has built its authority.
Even further, SEM and SEO can work hand-in-hand as SEM campaigns shine light on the keywords that provide the highest ROI (the ones that should be targeted for your SEO efforts).
SEM allows businesses to target a wide range of keywords and obtain conversion metrics on them fairly quickly. From these metrics, these businesses can see which keywords are offering the highest ROI.
They can then take those high performing keywords and integrate them into the SEO campaign. Over time, as the website builds more authority, they can pull in organic search traffic from these targeted keywords, further increasing the business’s ROI as the cost of traffic goes down and revenue stays consistent.
This is why SEM and SEO should not be viewed as an either/or scenario when planning your digital marketing campaign. Rather, they should be integrated with one another.