Our Pricing, Our Products
Free Report Special Offer
Fathom SEO TV

SEO and the ROI Debacle

Return on Investment (ROI) Trends

SEO gets high marks for ROI in MarketingSherpa's "Search Marketing Benchmark Guide 2007."

In a new "Search Marketing Benchmark Survey" marketers gave natural search engine optimization the highest ROI ratings among diverse marketing strategies for product websites (68.7%) and lead generation websites (69.7%).

Company-managed email marketing came in second -- 56.4% for products and 64.2% for lead generation. Paid search rounded out the top three - 52.5% for products and 64.1% for lead generation.

Unlike PPC, rankings achieved through SEO efforts continue to drive traffic even after a program ends. It's a nice reality when you're talking ROI. With paid advertising, if your account or well runs dry, the ads don't appear.

With conversions, the SEO/PPC victory debate goes back and forth with individual case studies. Two national reports in 2006 essentially pit both neck-and-neck with PPC as a slight leader.

WebSideStory, Inc. says PPC has a slight edge over natural search engine optimization (based on more than 57 million search engine visits this year). Paid advertising had a median order conversion rate of 3.40 percent at B2C e-commerce sites compared to an organic conversion rate of 3.13 percent.

Ali Behnam, Senior Digital Marketing Consultant for WebSideStory, indicates on their website that paid search marketers have "better control over the environment, including the message, the landing page and the ability to eliminate low-converting keywords."

Fair enough.

But conversion opportunities- whether PPC or SEO - vary with product types, time of year, site architecture, product descriptions, purchase incentives, prices, brand and countless other factors.

The WebSideStory numbers (although giving PPC a minor edge) are related only to e-commerce. And within those transactions there will be diverse conversion trends that favor either PPC or SEO. So it would be short-sighted to make strategic decisions around one or two conversion studies. In fact, Behnam added the conversion rates are higher than overall e-commerce site conversion rates because "our clients are steeped in web analytics best practices."

In addition to its overall ROI data, MarketingSherpa looked at conversions in its 2006 survey. Again, PPC nudged out SEO (4.19% to 3.92%). Among the top 1/4 of respondents (those who had the highest conversions), the PPC average was 10.34% and the SEO average was 10.13% - both double the top 5.11% average for all website visitors.

Natural search, for example, is limited in part by what a search engine specialist can pull off without wearing a black hat or disrupting the user experience (i.e. beefing up content in unusual ways).

A widely cited JupiterResearch study in 2004 found that nearly six of seven commercial sales related to search engines actually came from organic search results.

Keep in mind that even a seemingly low 0.5% conversion might be golden for one company and a destroy another.

Read excerpts from this SEO study online: