Making The Business Case For SEO

So what’s the ROI on this SEO program you’re recommending? How much revenue upside is there? What will it cost? How does this stack up against the fourteen other projects we’re working on right now?

Are these questions familiar to you? They are to me. I hear them in my sleep. I have had to answer each of them at some point (and most more than once) when making SEO recommendations both in-house and to clients. As SEO continues to grow as a viable marketing channel, you need to be prepared to answer these questions as well. Why?

Every SEO effort requires changes to your company’s website. And every time you change a website, it not only costs money, but also requires valuable engineering resources that could be doing something else. So, if you’re considering recommending SEO at your company, it’s important to think about the impact your SEO efforts might have for the business in real dollar terms. This is driven by the fact that product and engineering managers need to prioritize engineering resources to be sure that, at any given time, they are being used to drive the maximum value for the company.

The larger the company, the bigger an issue this becomes. In multi-product companies, the scope of this issue is greatly expanded. In large, multi-product companies like Yahoo!, the scale and scope can be daunting. Nothing gets put on a product road map without a business case, and the more compelling a business case, the higher the priority on the product road map. The good news is that the same practices that allow us to succeed in large, multi-product companies, also apply to small and mid-sized companies just as readily.

Here are some things you can do to help sell your SEO efforts to management or clients:

Value your traffic. It’s important to have a notion of what a click from a search engine user might have on your website. At Yahoo!, we use the notion of Lifetime Value to help us value web activity across a large number of web properties with vastly different business models. In principle, this does not have to be a complex exercise, but it can get as complicated as you let it. The idea is to quantify the revenue generated by a user over the lifetime of that user, and to discount that revenue stream back to the present. Use whatever data you have and then refine the model as you learn more. Where you don’t have data, use your best estimate, but make sure to note your assumptions and challenge them often.

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