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Entries in Chicago Search Marketing (2)

Monday
19Oct2009

AVOIDING COMMON KEYWORD MISTAKES WHEN STARTING A SEO CAMPAIGN

 

Keywords are the words or short phrases that businesses embarking on a SEARCH ENGINE OPTIMIZATION campaign choose because they want to come up at the top of the natural search results when a potential customer types the phrase in to their search engine.  Starting a SEARCH ENGINE OPTIMIZATION campaign without first finding the correct keywords is like starting a journey to somewhere that you have never been without using a map.  How do you know that you are going starting out in the right direction?  More importantly, how would you ever know if you arrived at the right place?

 Thorough keyword research is essential for small businesses who are investing resources into making sure that their website appears in the search engine results for potential customers that are interested in buying their products or services.  Though it sounds intuitive, my experience has taught me that people often make mistakes in choosing the right keywords, and sometimes these mistakes are critical and require time and even more resources to correct.

The most common mistakes that small businesses make when selecting their keywords are those having to do with keyword search TRAFFIC.  First, most businesses (and, unfortunately, some SEO companies) do not take the time to use available tools to find out if keywords actually have any search traffic coming to them.   There are tools (some free, some at a nominal cost) that can tell you how many searches there are each month for any combination of keyword phrases.

For those businesses that do look at the raw search volume numbers, there is a temptation to optimize the website for only those keywords which show massive amounts of monthly searches, and not necessarily those that have modest search volume but are most RELEVANT.  Remember, you cannot make your site valuable to someone who has absolutely no interest in buying your product or service.   Be specific when you start your campaign and start with the very low hanging fruit – for those people specifically looking for your exact product or service.  One is far more likely to have a conversion rate of over 90% of consumers looking for your exact model (“Fender American Vintage Stratocaster ’57) than even 1% of consumers searching for a large broad category term (“electric guitars”).

Also, very broad terms tend to be extremely competitive.  If the level of COMPETITION is too high for a broad term, a very good professional search engine optimization program could make you number one in those search results, but it may take a very large investment in an SEO program and certainly a lot of time.  Many of the same tools that measure search term traffic also measure the competition level for keyword phrases.  A good approach is to keep those broad search terms in mind, but focus on achievable rankings on well trafficked, targeted and relevant keywords in the short term, and this will make it easier to rank high for highly competitive broad terms in the long term.

The best approach is to balance the TRAFFIC, the RELEVANCE, and the COMPETITION in order to find a set of keywords that will work best for YOUR business.  By doing the right amount of research at the beginning of the search engine optimization process, you can save lots of time, money, and frustration later.

 

 
Tuesday
04Aug2009

Pay Per Click, Budgets, and Return on Investment

We have been having this discussion a lot lately with current and potential clients. How much should you invest into a Pay Per Click (PPC) campaign to get the Return on Investment (ROI) that you desire? SmartROI Consulting, LLC. advises people to go larger at first to see what the full impact can be then scale down or up accordingly once we have built significant data.  Below is a simple formula to follow when calculating your ROI.

Start with the “Average Lifetime Value” of a customer. How much is a customer is worth over the period of time that you work with them?  Do they make a one-time purchase, or will they be a loyal customer that may spend money with you every month of every year? For this example let’s take an average lifetime amount of someone who places an order with you every month, of which you earn $200 in revenue. If the average customer is with you for 5 years before they move or change needs, then this customer is worth $12,000 to your bottom line!

$200 x 12 months x 5 years = $12,000

If we want a 50% Return on our Investment, then we want to spend $10 to earn $15, or $100 to earn $150. In the previous example, if we spent $8000 to earn this customer, then we make $12,000 from them, which is a 50% return on investment.

How much would you like your website to earn?

The “Conversion Rate” of the site is a very important thing to measure. In order to find this, you need to use tracking and analytical data to source how many visitors are coming to your site, and how many of those are turning into paying customers. If you have 100 visitors to your site and 5 of them ‘convert’ into customers, then that is a 5% “conversion rate”.

If your goal is to bring in 10 new customers per month and your conversion rate is 5%, then you would need to attract 200 visitors to your site in order to turn 10 into paying customers.

How much do you need to spend on pay-per-click in order to bring in these 10 customers in? If we continue with the example above and each customer brings in $200 of revenue per month but is a customer for an average of 5 years, 10 customers are worth $120,000!

If a modest pay-per-click budget of $2,000 is spent per month to bring in $120,000, the Return on Investment is 6,000%!!!

There is no magic number or ratio to get your desired ROI, but search marketing including SEO and PPC has the lowest cost per lead than other popular forms of advertising. A study by Piper Jaffray shows Search marketing had a rate of $0.45 per lead followed by email at $0.55, Yellowpages at $1.18, banner ads at $2.00 and Direct Mail an astounding $9.94 per lead.