Search Engine Optimisation is a vital tool for any digital marketing team, but its real cost is often shrouded in mystery. And there’s no shortage of ‘SEO experts’ out there, but the industry is also rife with cowboy operators who promise the earth for a rock bottom price, and often end up doing more harm than good.
So, how much money should you invest to ensure you are purchasing a high-quality, ethical SEO service that will deliver a healthy return on your investment?
Here are three things you need to do before investing in SEO.
1. Decide on a marketing budget – then take the plunge!
Money for SEO tends to come out of the marketing budget, so let’s start there.
We’re fans of the value based pricing model for calculating marketing budgets, as it’s based on your bottom line. This is often a smarter way to calculate marketing investment than simply apportioning a percentage of turnover.
Let’s say your gross profit margin is 40% and the average lifetime value of each of your clients is £100,000. You need to win 15 new clients per year, and you are willing to invest 10% of their lifetime profitability to do so. This is how you would calculate your marketing budget using value based pricing:
- 40% gross profit from £100,000 lifetime value is £40,000
- 10% of £40,000 is £4,000: the amount available to acquire a new client
- 15 new clients at £4,000 each to acquire gets us to an annual marketing budget of £60,000
- The monthly marketing budget is £5,000
When you know how much money is available for marketing as a whole, you’ll need to figure out how much to earmark for SEO. There’s no precise percentage to aim for; the right amount will depend on your business type, customer base, other marketing activities, and how many internal resources you have at your disposal.
2. Choose the right payment model for YOU.
If you decide to hire an SEO agency or freelancer, there are a few typical payment models you will encounter.
We’ve detailed them here, along with the prices you can expect to pay (figures from Search Engine Watch).
Generally, the prices at the lower end of the scale belong to freelancers working on small websites, whereas the higher figures tend to reflect agency rates for complex work on large corporate websites.
At Zanzi, our pricing typically falls in the middle of these ranges:
Contract services at a fixed price
Often used by businesses conducting entry-level SEO, contract services usually start with an audit of the site and its link profile. This could cost anywhere from £350 to £6,000, depending on the site’s complexity. Other contract services include SEO copywriting (usually 10p – 30p per word), and social media channel setup (anywhere from £350 to £4,000 depending on the brief).
The range of quotable prices is as broad as the range of potential projects, but most are charged between £750 and £30,000.
Hourly consultation rate
SEO consultants generally charge £75 – £250 per hour to provide insightful guidance on how to improve your site’s visibility in search.
In a piece of research by the Agency Collective in 2015, the average hourly charge out rate for independently owned agencies was £86 per hour. Check out the PDF here, the findings on hourly rates are on page 17.
This is likely to be used for ongoing services, such as ongoing digital marketing. SEO agencies might charge a smaller company £750+ per month for a basic package, or £2,000 – £5,000 to deliver a comprehensive service for a business with ambitious growth targets.
3. The waiting game – how tracking can make your investment worthwhile.
SEO takes a while to produce significant results, but a trusted SEO agency or freelancer should be able to demonstrate the impact of the changes they’ve made. As their client, you have a right to ask for deliverables – so don’t take no for an answer.
You can keep track of how SEO is helping your site develop through looking at metrics such as website traffic and conversions, click-through rate, keyword positions and enquiry rate. A decent agency will work with you to establish Key Performance Indicators (KPIs) like these at the outset, and they will provide regular progress reports.
We suggest checking your KPIs at least monthly, but make sure you give your SEO strategy a little breathing space (between 3 to 6 months) to take effect.
SEO services may require a significant initial investment. But, if done properly, you can look forward to rich returns in the long-term.