“We can’t rank for the keywords that actually lead to revenue.”
“PPC (pay-per-click) is more valuable than SEO (search engine optimization).”
“I just don’t see the ROI (return-on-investment) from rankings.”
“We need to be ranking for these [list of irrelevant] terms.”
It’s difficult to attribute a dollar amount to rankings. And it’s complicated. There are many reasons for this, and Kameron focused on 3 customer situations:
- Rankings are strong and traffic is high, but revenue from rankings isn’t there
- Rankings are up but business is down
- “SEO doesn’t produce the same ROI that PPC does”
1. Rankings are strong and traffic is high, but revenue from rankings isn’t there
This is a common scenario. Your content is ranking well on Google and is displayed on the first SERP (search engine results page). Google Analytics tells you that organic search is a big source of traffic to your website.
…soooooo where’s the revenue spike? Where are the conversions? Where is the money from these rankings?!
These are good questions. But first, let’s discuss how you make money from rankings.
Rankings factor into revenue in various ways that depend on the industry you’re in. Take a publishing business for example. In the publishing model:
Rankings → Traffic → $$$ (revenue)
Publishers can monetize traffic directly. There may be other goals and conversions tied to a dollar amount as well, but in this case high rankings = revenue.
What about the eCommerce model?
Rankings → Traffic → Purchases (revenue)
eCommerce businesses don’t always have leads. Potential customers become current customers with a few clicks, no lead nurturing sequence necessary. They don’t need a discovery call from an SDR, a demo, or a contract.
A potential customer searched, found your high ranking content, clicked, clicked a few more times, and they became a customer.
How about a lead generation business?
Rankings → Traffic → Leads → Customers (revenue)
And there we have it. A few steps between ‘rankings’ and ‘revenue’ means more opportunities for revenue to be attributed to something else.
Rankings are the base of the pyramid, and the pyramid has multiple levels. Depending on your sales process, the pyramid might have a lot of levels.
Ranking well means you show up for search results. Not every person who searches for that term will click on your link. Those that do click on your link go to your site.
Once on your site, a smaller percentage will convert to leads. Once they become leads, a smaller percentage will convert to customers.
“Rankings are NOT the end-all be-all, they’re a means to an end. Not an end in themselves.” – Kameron Jenkins
Rankings are the base of the profit-pyramid!
Another possible reason why your business isn’t raking in revenue from rankings is that the target keywords you’re working to rank for:
- Don’t drive value
- Don’t have heavy search volume
Kameron calls these “pet keywords”. These are the keywords that you don’t have a good reason for having, you just want them. They might be the keywords that:
- Your competitors rank for
- You feel that you have to rank for them too or they’ll beat you!
- Have the highest cost-per-click (CPC)
- Their perceived value is high, but there’s no concrete data that they will actually have value for you
Have an honest conversation about your content strategy. Look at the search volume and searcher intent of your target keywords. Investigate the steps in between “ranking” and “revenue”.
Your rankings might be doing more for you than you think.
2. Rankings are up but business is down
Not an ideal situation. It would be lazy to put all the blame on the beliefs that “rankings don’t work” or “SEO is dead.”
There’s a disconnect somewhere, but where?
Kameron advised looking at the lead nurturing and sales process. Ask yourself some questions:
- Does the ultimate conversion happen offline?
- Over the phone?
It’s difficult to say that rankings are responsible for an in-store purchase, but they might be.
- How do you handle leads?
- Who answers the phone?
- How do they answer the phone?
- Do you have a phone service for nights or weekends?
- How are emails handled?
- Where are your leads stored?
Don’t blame rankings because your leads are falling through the cracks from missed calls, unopened emails, or lack of a contact management system / CRM.
- Are there any external factor changes?
- Was there a price increase?
- Is the business focused on different jobs?
- Has the market changed?
Don’t abandon a successful content strategy because of external factors!
3. “SEO doesn’t produce the same ROI that PPC does”
Consider the following scenario:
A potential customer notices a pigeon outside their window that appears to be staring at them. They laugh at the idea of birds spying on people. The potential customer has a few minutes to burn and types into Google, “are birds spying on us”.
They see a result at #3 – HOW? – Birds Aren’t Real
The phrase “birds aren’t real” is just ridiculous enough for them to click. The article is a 5500 word exposé about how the government replaced all birds with drones to spy on us. The potential customer notices an eCommerce store and social links on the page. They click the links and follow the movement on Twitter and Instagram.
A week later, the potential customer can’t stop laughing about the site. They log onto Instagram and see an ad for the Birds Aren’t Real store. They click through, click a few more times, and in 5-7 business days will be wearing a t-shirt to spread the news.
All because of a Google search… (Source)
…who gets the credit for the purchase?
Your ad center will tell you the customer converted from an Instagram ad, but that’s not the whole story.
How much responsibility does the ad get? How much does the organic ranking get? How much does that creepy pigeon in the window get?
It’s complicated! The organic ranking is responsible for some of that purchase, but how do you show the value of SEO beyond “last-click”?
Kameron advises looking at “assisted conversions” or the interactions a customer has with a website that lead up to the ultimate conversion.
One way to do this is the lookback window in Google Analytics. The lookback window is the amount of time you tell Google Analytics to keep track of people on your site.
Once adjusted, you’ll have a better sense of the indirect impact your SEO rankings have on revenue.
Conclusion: Take it even further
Knowing that your content rankings had an impact on X amount of conversions is one thing, but what about assigning an actual $ amount to it?
Kameron suggests doing this by calculating the value of each lead. She called this the ‘goal value’ and you can determine it with the following formula:
Lifetime Value (LTV) x Close Rate = Goal Value
To determine LTV, first calculate the average purchase value. Do this by dividing:
[total $ value of orders in a given period] / [number of orders in that given period].
Take that number and multiply by the average purchase frequency rate. Average purchase frequency rate is found by dividing:
[total number of orders in a given period] / [total number of customers in that given period]
This leaves you with the average customer value. Multiply that by your average customer lifespan and you’re left with LTV.
To calculate close rate, divide:
[number of customers] / [number of leads]
When all is said and done, you’re left with the $ amount of each lead. Combine that with your assisted conversions data, and you can prove that rankings drive revenue.
It’s a complicated task, but remember:
“Rankings are a means to an end, not an end in themselves.” – Kameron Jenkins