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Questions I always hear with regards to SEO and marketing optimization:

  • How does Google Analytics improve my search engine optimization (SEO)?
  • How can I get more out of my SEO?
  • What is the real effect of ranking on search engines for my business?

I am hoping the case study below will shed some light on these questions. If you apply a similar analysis you can help your customer, manager, or whoever is delaying your SEO effort. But instead of answering “the importance of ranking” question, maybe something more quantifiable and measurable might get your decision makers’ attention! How about “how does ranking on a specific keyword, or lack thereof, impact the bottom line?” Answering such questions will help us make the most of our marketing spend during these tough economic times and help us do a more effective job in marketing and campaign optimization.

I’ll use real time data and analysis but won’t mention the name of the website for privacy reasons. Here are the details:

  • Website type: eCommerce
  • The website used to rank near the top of Google on two competitive keywords until August 2008.
  • Historically, these two keywords have driven traffic to the site. For a specific time period, these two keywords drove 5,684 visits and led to 46 conversions for a 0.81% conversion rate.

If you have your Google Analytics eCommerce features properly configured and working, the above data is easily accessible under the Traffic Sources -> Search Engines -> Non-paid report. The inline filter was used to get data for just these two keywords.

  • We then start examining the time period when the ranking for these two keywords took a big hit.
  • Next, using the date comparison function in Google Analytics, we compared the traffic generated by these two keywords for this year with poor ranking versus last year with better ranking. Here is the result:

The table on the left is for one of their keywords and the table on the right is for the other. As you can see, a significant drop in visits in 2008, 4471 to be exact. So the negative impact of the drop in SEO ranking was less opportunities to make sales on their primary keywords!

  • The 4471 visits might be a small percentage of the overall website traffic but when you put a dollar sign next to it, we typically react to it more quickly. Take the 4471 visits and multiply it by your average conversion rate for these keywords, which is 0.81%, and then multiply by the average order value, which is $846.
  • 4471 x 0.0081 = 36 lost sales
  • 36 x $846 = $30,456 of lost revenue!

Now one can argue that this number is not accurate because of many factors BUT the findings are very actionable! If I were to present this analysis to my boss or client, I would add 2-3 other scenarios:

  • Scenario 1, with a higher conversion rate of 1.62% after improving the design and usability of the site, the lost revenue would be $60,852. (ouch!)
  • Scenario 2, with a lower average order value and the existing conversion rate of 0.81%, our lost revenue would have been $15,228.
  • You could create a table to show the range. The main point is that there was between $15K and $60K of lost revenue. In tough economic times, wouldn’t you rather have that revenue?

Depending on your company size, marketing budget, and other factors, the $30K might be a significant number or it might be a rounding error. But at the end of the day, $30K of lost revenue is $30K of lost revenue, especially in times like these where cutting cost and marketing optimization is more important than ever. By doing similar analysis, you can find other lost sales opportunities, monetize them, and get some corrective actions underway.

I think you can take this analysis to a business owner or marketing manager, and I am pretty sure they would get the SEO effort prioritized.