What is SEO ROI?

Return on Investment (ROI) is what every client wants from a search marketing agency. It’s an easy thing to calculate if you’re doing Pay-Per-Click (PPC) advertising. If your revenue is higher than your spend, PPC management fees and cost of goods, then your client is getting a return on their investment. Although it’s simple to figure out ROI for PPC, the same cannot be said for search engine optimization (SEO).

Search marketing agencies that provide SEO services have traditionally reported ROI in a variety of ways. The most common approach to SEO ROI has been search engine ranking. If a company can get a client to perform well in organic SERPs, often times focusing on a handful of short-tail keywords, then they’ve done their job. Unfortunately, that’s not exactly SEO ROI. Instead, it’s a trophy that may not be worth anything at all.

The fallacy of short-tail search terms is the assumption that it provides a return on investment. For example, if a company is spending $5,000/mo to an SEO agency to build up and maintain short-tail keyword phrases, that agency may report those SERPs as SEO ROI. Agencies have been training their clients to believe that highly ranked short-tail SERPs is ROI, when that couldn’t be further from the truth.

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