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When is SEO Worth $100 Million?

how-to-value-seo.pngTo date, I’m not sure I’ve found a more detailed whitepaper on measuring the value of search engine optimization until reading this Whitepaper, How to Value SEO. There are some other sites that have developed similar whitepapers, but this is the first time I’ve seen it explained for someone with an MBA to fully understand.

The document walks any reader, with the use of a spreadsheet and free tools available from Google, to analyze and calculate the value of getting ranked. Included in the whitepaper are:

  1. Valuing SEO as a Comp Analysis
  2. Annual Value of a First Page Google Ranking
  3. Annual Value of a First Page Ranking Across All Search Engines
  4. Annual Value of Long-Tail Derivative Rankings
  5. Valuing Long Term Organic Rankings
  6. Calculating Present Value of First Page Rankings

Did you ever wonder what the annual value of a First page Google Ranking is for a highly competitive term like Health Insurance? How’s $7,471,194 sound? That’s exactly what it would cost, though, to bid and win enough ads to gain the same number of visits per year (840k at $8.90 per click). The Five-Year Net Present Value moves that number to nearly $100,000,000. (You’ll have to read the whitepaper to understand why that’s an accurate assessment).

Your SEO may not be worth as much, but it is time that you stop thinking about search engine optimization as another marketing expense and begin to start valuing it as an investment that can turn your company around – especially in this economy.

The estimated investment for a company to gain first page ranking for Health Insurance is $200,000 the first year and $50,000 each year after to maintain the ranking. That’s a very nice return on investment and a fraction of the cost of what it would take to obtain that same traffic in traditional media.

Download the Whitepaper from Slingshot SEO.

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About Douglas Karr

Douglas Karr is the founder of The Marketing Technology Blog. Doug is the CMO of CircuPress and CEO of DK New Media, an agency specializing in assisting marketing technology companies with their inbound marketing - leveraging social media, blogging, search engine optimization, pay per click and public relations. Their clients include Angie's List, GoDaddy, Mindjet and many more. Douglas is also the author of Corporate Blogging for Dummies.

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3 comments

  1. The thing I like the most about this SEO whitepaper is that a direct comparison is used the most likely alternative – Adwords. Where you can truly optimize your Adwords campaigns, that is an ongoing cost. This paper quantifies those sunk, up-front marketing dollars and when the payout will be.

    This paper promotes the residual value of a top organic ranking, however the business still has to think through a number of pieces further downline and how they affect that cash flow payout;

    % of entrants who actually convert after click through
    Lifetime value of that customer
    Which terms with a #1 ranking will result in a sale

    Let’s say you have an extremely targeted, compelling value proposition and you attain an excellent 35% conversion rate (leads to a sale) once the user hits that landing page – Now that nearly $7.5 million comp analysis is $2.6 million instead.

    The great thing about Slingshot SEO, and a contributor to their tremendous growth, is that they will turn away clients when the valuation for organic listings and the resulting payout does not make sense.

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