How Much of Your Business Budget Should Go Toward SEO?

Are you ready to invest in SEO? Well, you’ll need to set aside some money for that.

About half of businesses surveyed by Search Engine Journal said that they don’t have a budget for SEO. Since it’s organic search results and not paid ads, you don’t need to set aside a budget, right?

Not quite.

You do need to spend some of your business budget on SEO in order to see results. How much should you spend?

There’s not an easy way to answer that question. Let’s take a look at the cost factors of SEO and how you can calculate a budget for your business.

SEO Cost Factors

In order for you to calculate the cost of SEO, you need to look at the different components of search results.

You need to do audience research, competitive research, and keyword research. You then need to create content that contains those keywords.

There are also technical aspects of SEO. You need to make sure that your site is fast and the meta tags are filled out correctly to tell search engines what your content is about.

The second part of the equation is whether or not the work is done in-house or if you plan to outsource it. You may decide to outsource some aspects of SEO or all of it.

If you do keep SEO in-house, you need to have someone responsible for keeping up with SEO changes. Search engines update their algorithms constantly, and you need to adjust your strategy accordingly.

What is your goal with SEO?

If you want to use it to collect leads, then you need to track your conversion rate and the lifetime value of a customer. If you know that one of the leads will convert into a customer each month, then you can use the lifetime value of a customer as your initial SEO budget.

When you use SEO for sales, you’re targeting customers in the later stages of the buying process. These keywords tend to be more competitive and will require a larger budget.

Business Budget Considerations

Most marketing guidelines say that you should spend about 10% of your revenue on advertising. That’s all advertising, not just SEO.

Do you already spend money on advertising? What are those channels? How much business do they generate?

You have to ask yourself these questions because you need to determine how much of that 10% should go to SEO.

For instance, let’s say that you have a $200,000 company. You should spend $20,000 on your marketing expenses. You already spend money on social media ads, content, and search ads.

How much money do those tactics generate? You might find that you get a lot of responses on social media ads, but your search ads don’t generate as much income.

What you can do is allocate some funds to SEO to build momentum. You can then cut back on your PPC ads once your site ranks for those important keywords.

SEO Isn’t a One-Time Expense

Here’s where business owners get lost in SEO. They treat SEO as a short-term ad campaign. You can’t invest in SEO for a few months and expect to see results and maintain them.

SEO is a long-term marketing strategy. You need to approach it that way. You may be able to see results in the first few months, but you have to give your campaign time to gain momentum.

The more content you produce, the more keywords you have in search results, the more momentum you build. You’ll get more high-quality traffic to your site and you’ll enjoy the increase in sales.

When you stop your campaign because you didn’t set aside enough money, you’ll lose that momentum. Traffic and sales can slow down.

You should expect to see results in 6-9 months. Those results will compound over time. You should set aside funds to invest in SEO every year.

Think of it as website hosting or another annual expense. You just pay for it because it’s necessary.

Outsourcing to an SEO Company

There are advantages to outsourcing to an SEO company. From a cost perspective, many firms charge a flat fee, so you have a predictable expense each month.

You have experts that live and breathe SEO. You and your team can focus on other aspects of your business and leave algorithms to the SEO company.

What should you look for when you hire an SEO company? You want to hire a company that understands your business needs.

They’ll also have a process to SEO that is customized to your business. They’ll do the research, audit your website, and have a plan of action.

When you’re looking for SEO companies, be sure to look at the reviews of the company and ask how they communicate with you.

Some companies don’t communicate with clients at all, leaving you to wonder where your money goes. At the very least, there should be a monthly report which details your SEO progress.

Spend Your Business Budget Wisely

How much of your business budget should you devote to SEO? There really isn’t a clear answer because there are so many variables that depend on your business and your goals.

You could spend very little or you can spend thousands a month on SEO. No matter how much you spend, you do need to be clear about your goals and be prepared to invest a lot of time and energy into SEO.

It’s not something that should be treated as a quick fix that will solve your business problems. It takes months and years of consistent work.

Be sure to see the other articles on this site to help you with all things business and marketing.