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Is SEO worth it?
2010-12-24: SEO can take a while and considerable effort before it bears fruit so .. is it worth that effort? How can you tell ahead of time?
A client came to me with a business idea within the financial marketplace, let's say it was a service to save businesses from bankruptcy (it wasn't, but for illustration).
The first point is to say that it's easy to look at that growing market and say "I'd like a piece of that business", even to go "it's worth a gazillion pounds a year, if I only got 1% of that I'd be laughing", but it's harder (and rather less exciting) easily to see the strength of the competition .. the strength of the forces that aim to keep that business for themselves and if they can, to stop you in your tracks.
Faced with an army of 100 soldiers you wouldn't take them all on at once, you might pick the puniest looking one, take him on first and work up from there. That's the strategy for breaking into an established online market.
So we can look for the keyphrases that people use when their businesses are heading for bankruptcy. Using seed phrases such as 'business bankruptcy' we can quickly get a list of maybe 100 other phrases people use, how often they use them in our country, and the strength of the competition as a score out of ten, so that's a start (and we are already far ahead of the information available to a new shop opening on the high street).
If we choose some highly relevant phrases that have sufficient demand and low enough competition we can then look at the businesses that already have a front page position in Google in our country.
For this business, and for my favourite phrase, the top ranking business had 3,186 inbound links to its website. To beat them, I would have to get the same. But, I assume they are not standing still. We can measure it, but let's imagine they are adding 100 inbound links a month to their total. If we want to beat them in a year, we are going to have to generate 4,386 inbound links, or more than ten a day. We need a strategy to achieve that, and enough resource to fund it for a year. That seems unlikely for a small, startup business.
However, the website in position ten for that phrase only has 3 inbound links. We can beat that tomorrow. But if the tool we are using only registers and reports perhaps 1:3 inbound links, then actually we need 9 inbound links.
The tool I use doesn't report the Page Rank (PR) of those inbound links, but of course, those 3 inbound links might be PR 5 or 6 or higher, meaning we have to do the same or get lots of lower PR inbound links. We can check to see (I just did and happily the links are PR 0). One client said to me the other day "we only go for PR 4 or higher links". The danger is always that you have to appear natural to Google or they may well knock you down for gaming the system. So you need a mix of PR scoring inbound links for a secure future .. there are plenty of tales of people with a steady income, a growing company and staff to pay, waking up one morning to find the phones silent and their inboxes empty. Better to play this safe.
Now, the traffic that goes to the #10 position is just under 3% of the total traffic to the page, and the monthly traffic in the UK for my chosen phrase is 1,900 visits, so if we achieved that #10 position we would receive maybe 57 clicks a month.
Assuming we convert 1:200 visitors into a sale (you can test this with PPC before you start), and we make £1,000 a sale, that's £285 a month which is a start.
So the question becomes: is it worth putting in the SEO effort to reach that achievable #10 position for that keyphrase in order to get a year or more of £285 a month? The answer is probably yes.
Compared to trying (and failing) for months to get a position on a super-competitive phrase, this makes more sense.
And of course, once you have that position, perhaps it's worth aiming higher up the page or perhaps there are other phrases to target. The SEO function, then, in a new business, creates a flow of little sparks of business that comprise a position on a keyphrase strategically and intelligently chosen out of a large pot of possible search keyphrases. SEO can then develop those sparks into flames while also continuing to find new sparks.
How many sparks you get, and whether you can turn any into flames depends on the resource you put in, but there comes a time when, let's say you spend £100 a month on SEO because you're a weeny startup business .. actually that's too small an amount because you do have to run at the speed of your slowest competitor and if they are spending £200 a month then you'll never get anything back for your investment .. better (from an SEO point of view at least) to start with some gumption and calm down once you get a sense of your impact on the market.
But .. let's say £100 a month is enough for your startup weeny business that isn't making any sales. Let say you make your first sale after month three and by six months or so you are making maybe £1,000 a month from SEO triggered sales. That's an optimistic outcome to be honest on that size of investment, but anyway, for illustration: so then you can start to say .. well, I'll spend 10% of my SEO triggered sales on more SEO. That percentage is set by experience once you see whether your business is building or declining. Basically, SEO investment is your accelerator pedal.
So, is SEO worth it? Here you can see, all the data you need to work out your possible return on investment (ROI) is publically available so you can work it out. You can make a guess at what's needed to get a position in Google and what your return might be.
The only thing us SEO people can't guarantee is that you will actually get the position you planned for on any one occasion. But overall it will work out.
So. Calculators at the ready? Let's make some money.

By John Allsopp
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