As a business owner, your job is to figure out ways to attract customers to your business, and do it in a way that costs less money than they bring in as profits. There are simple formulas to follow to make these decisions, and you can apply them to your marketing efforts. Each type of marketing is different and will have a different rate of conversion to customers (based on the engagement of the initial group you market to.) This means that some groups of people are more engaged and likely to become customers than others. For example, if you put up a billboard, your initial group is everyone who drives past that billboard every day. They may or may not be interested in your products or even your type of business, but you can assume that a percentage of that group will potentially be customers and will patronize your business because they saw your ad. Wide and generic markets are going to have the lowest conversion rates because they contain less of a percentage of people who are directly interested in your business. A television commercial for a sports shop placed during a sporting event is going to have more of an engaged audience, and therefor should expect a higher conversion rate from viewers to customers. SEO uses Google to expose your business to new customers, and the engagement rate is expected to be very high because they are proactively searching for your products. Each specific search that a person does brings up a different list of websites, and SEO brings your website to the top of the results that people are actively searching for. This type of engaged audience generally converts much higher than random audiences. The problem is that because of the sheer volume of results that get presented on Google searches, people tend to only look at the first few in order to make a decision, assuming that Google would only put the best businesses at the top. In reality, Google puts the businesses with the best SEO at the top.
SEO is a process of manipulating the content and code of a website in order to make it come up higher in the results, successful SEO getting positions on the first page and hopefully in the top three. This is where the majority of people searching will choose from, the top result getting more than 50% of all the traffic statistically. A certain percentage of these searchers will click through to your website as a result of being presented with it in the results, and a percentage of those people will become actual customers. In SEO, we look at how much traffic is being driven to your website through organic Google results, and your website quality and products will determine the conversion rate. Although the two are sometimes intertwined, SEO is more about driving the traffic. By getting more people to know that you exist through presentations on search engine results, SEO exposes your business to potential customers the same way a billboard or TV commercial does. To understand if SEO is worth it for your business, you must consider how much it is costing you every month vs how many clickthroughs you are getting. If you are getting a lot of traffic but it is not converting to customers, it is probably a problem with your website or products, and not your SEO. The job of SEO is to get people to your site. If the SEO efforts are driving 100 people to your site every month and 10% of those people become customers, you can look at how much an average customer spends and multiply that number by ten to find out the value of the effort. Minus the expenses that it costs you to run the business and buy the products you sell (the profit margin) and you can see if the efforts of SEO are paying for themselves. If the added amount of converted customers to your website every month is generating sales and profits that pay for the SEO company’s work, then the SEO is worth it.
You must understand that SEO is a process and does not happen overnight. Your SEO company should help you to determine which phrases are the most beneficial to target through “keyword research” where the raw numbers of monthly searches on Google are determined. The competitiveness of that phrase on Google will determine if an SEO program needs more or less work for your business, and the SEO company should be able to show you ongoing rankings increases that are moving your website toward the goal of top three placement within a reasonable timeframe (three months to nine months usually.) You can expect the efforts to not produce new customers until those first page placements are produced, but a good SEO program will eventually produce far more clickthroughs and new customers than the cost of the program itself.