Forecasting for SEONeil WalkerCTOJust Search Ltd

Who am I?

Who am I? Neil WalkerURL: www.seomad.comTwitter: @theukseo

Current Position: • Owner of SEO Consultancy Firm SEO MAD LTD

Background: • Chief technical Officer (CTO) for Just Search Ltd

Experience• Worked or been involved with SEO for over

2500 clients in the UK and nearly 5000 clients for Pan Europe.

Learning Objectives

The purpose of this seminar is to show you how to create a factual SEO Business Plan / Case by:

1. Predicting organic traffic to your website2. Analysing the potential income3. Studying the investment required4. Working out profit & loss for your business

plan.5. Carrying out ongoing tracking of your

predictions6. Looking at long term goals by reviewing the

potential from ranking between positions 10-5 against 3-1.

Google’s Domination

Click Through Rates

Organic vs PPC Click Through RatesPt.1

Organic vs PPC Click Through RatesPt.2

Organic Click Through Rates (Eye Tracking 2004)

People have been interested in CTR for many years.

This image was highlighted by SEO Researcher.com based on research from Cornell University from 2004

Organic Click Through Rates (AOL 2006)

1 2 3 4 5 6 7 8 9 100.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

40.00%

45.00%

CTR vs. Organic Position

Position in Google

CTR

August of 2006 AOL leaked millions of search records

Organic Click Through Rates (Google 2010) Pt.1

This month GWT enhanced their Top Search Query Function.

At Just Search we compiled sample data from 100 clients across 1500 key phrases.

Organic Click Through Rates (Google 2010) Pt.2

We took the data and also segmented in by Key Phrase length, again this revealed some interesting information about ranking No.1

Organic Click Through Rates (Google 2010) Pt.3

Finally we took the data and segmented by Brand, General, Location and Specific Product key word searches.

Organic CTR

From the collated data we can now make an educated guess at the

Click Through Rate if your website ranks on the first page for a given

keywordPosition 2-10 = CTR 4.85%

Conversion Rates

Website Conversion Rates Pt1

PPC is a good way to find out your website’s conversion rate, however if you do not have this luxury, there are a number of sources which can give you an idea of Average Conversion rates.

Low Typical WCR High Typical WCR Low Finance WCR High Finance WCR

Low E-commerce High E-commerce Average0.0%1.0%2.0%3.0%4.0%5.0%6.0%7.0%8.0%9.0%

Website Conversion Rates

Type of Website

Conv

ersio

n ra

te

Website Conversion Rates Pt2

We also researched the Google Analytics accounts for the data of13 websites over a total of 166,699 keywords.

Website Conversion Rates Pt3

From the collated data we can now make an educated guess at the conversion rate

of a websiteAverage Conversion Rate = 2.9%

Keyword Analysis

Keyword Analysis Pt.1

Use a tool to give you the predicted traffic i.e.

1. https://adwords.google.com/select/KeywordToolExternal2. Microsoft-advertising-intelligence3. https://adwords.google.com/o/Targeting/Explorer

Keyword Analysis Pt.2

Take a look at your competitors, their demographic, what keywords they are trying to rank for useful tools for this are:

1. www.semrush.com2. www.keywordspy.com3. www.alexa.com4. www.google.com/adplanner

Keyword Analysis Pt.3

We now have the following data:

CTR on Ranking Organically between 2-10Average Website Conversion RateExact predicted Monthly Traffic per keyword

We now need:Potential Timescale to gain resultsAverage Gross Profit per service / product.Average Order Values

Income, Investment & Timescales

Predicting Timescales Pt1

This requires expertise!!

-If you’re client-side, then get estimated timescales from a potential SEO provider

-If you’re agency-side, then look at all the factors required to gain a ranking and use your experience to predict a timeline.

Ranking Factors

Age of site No. of pages

No. of links Type of keyword

Type of competition Internal linking

Resource required On Page Work

Predicting Timescales Pt2

Research shows the following can affect timescales within SEO.1. Increase in Links2. Age of Site

Predicting Timescales Pt3

Further research also shows the following affecting factors:1. Industry2. No of competing Pages.

Investment Required

Again client-side – You will get potential cost from your SEO Provider.

Agency-side – You need to think about:

Investment factors

On Page Work Required

Link Building Budgets

Link Acquisition Hours

Content Writing Costs

Offline Investment Costs

Potential Income

Finally, to put your business plan together you need to know your potential Gross Profit %. Either an average GP Or even better a GP per product.

You will also need to look at your potential Average Order Values or Product / Service Prices Carry out market research E-commerce site / service site

Quick Overview

You should now have the following data:

First Page CTRWebsite Conversion Rate

Potential Keywords & Traffic Predicted TimescalesInvestment RequiredAverage Order ValueAverage Gross Profit

Financials

Putting it together

Use Excel to put all your information together

KeywordTimescale (Months)

Local Monthly Searches Organic % CTR

No. of Visits pcm

Conversion Rate No. of Sales pcm

Average Order value Income GP% Profit

trainers 9 201000 65.00% 4.85% 6337 2.90% 183.76 £43 £7,811.60 60% £4,686.96running shoes 5 60500 65.00% 4.85% 1907 2.90% 55.31 £39 £2,131.67 60% £1,279.00puma trainers 8 27100 65.00% 4.85% 854 2.90% 24.78 £73 £1,812.82 60% £1,087.69trainers sale 3 5400 65.00% 4.85% 170 2.90% 4.94 £35 £172.79 60% £103.67sportswear 3 33100 65.00% 4.85% 1043 2.90% 30.26 £27 £830.06 60% £498.03crocs 9 110000 65.00% 4.85% 3468 2.90% 100.56 £40 £4,044.71 60% £2,426.83football boots 7 135000 65.00% 4.85% 4256 2.90% 123.42 £46 £5,700.79 60% £3,420.47nike trainers 5 70000 65.00% 4.85% 2207 2.90% 64.00 £46 £2,955.96 60% £1,773.58reebok trainers 3 18100 65.00% 4.85% 571 2.90% 16.55 £46 £754.07 60% £452.44golf shoes 5 60500 65.00% 4.85% 1907 2.90% 55.31 £57 £3,134.45 60% £1,880.67basketball shoes 4 22200 65.00% 4.85% 700 2.90% 20.30 £47 £953.90 60% £572.34sale trainers 3 720 65.00% 4.85% 23 2.90% 0.66 £47 £31.20 60% £18.72sports clothing 2 8100 65.00% 4.85% 255 2.90% 7.41 £33 £247.78 60% £148.67england away shirt 4 2900 65.00% 4.85% 91 2.90% 2.65 £34 £89.08 60% £53.45karrimor 7 20500 65.00% 4.85% 646 2.90% 18.74 £53 £1,002.30 60% £601.38tennis rackets 6 27100 65.00% 4.85% 854 2.90% 24.78 £29 £723.69 60% £434.22football tops 4 5400 65.00% 4.85% 170 2.90% 4.94 £74 £366.81 60% £220.08adidas predator football boots 2 3600 65.00% 4.85% 113 2.90% 3.29 £50 £165.91 60% £99.55sports wear 3 8100 65.00% 4.85% 255 2.90% 7.41 £26 £190.98 60% £114.59

819320 25829 749.04 £33,120.58 £19,872.35

Pivot Table

Create a Pivot Table

Analyse the potential income you will start receiving for each keyword for each month.

Row Labels 2 3 4 5 6 7 8 9trainers £7,812running shoes £2,132puma trainers £1,813trainers sale £173sportswear £830crocs £4,045football boots £5,701nike trainers £2,956reebok trainers £754golf shoes £3,134basketball shoes £954sale trainers £31sports clothing £248england away shirt £89karrimor £1,002tennis rackets £724football tops £367adidas predator football boots £166sports wear £191Grand Total £414 £1,979 £1,410 £8,222 £724 £6,703 £1,813 £11,856

Investment

Your SEO Company advises it will cost you £2500 pcm

Will you make a profit?

How long will it take you to break even?How long will it take to pay back your investment?

Profit & Loss Year 1

Internet World 2010P&L

Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12 Year 1 Average

Income £ £ £ £ £ £ £ £ £ £ £ £ £ £

2 Month Keywords - 414 414 414 414 414 414 414 414 414 414 414 4,551 379 3 Month Keywords - - 1,979 1,979 1,979 1,979 1,979 1,979 1,979 1,979 1,979 1,979 19,791 1,649 4 Month Keywords - - - 1,410 1,410 1,410 1,410 1,410 1,410 1,410 1,410 1,410 12,688 1,057 5 Month Keywords - - - - 8,222 8,222 8,222 8,222 8,222 8,222 8,222 8,222 65,777 5,481 6 Month Keywords - - - - - 1,363 1,363 1,363 1,363 1,363 1,363 1,363 9,541 795 7 Month Keywords - - - - - - 6,703 6,703 6,703 6,703 6,703 6,703 40,219 3,352 8 Month Keywords - - - - - - - 1,813 1,813 1,813 1,813 1,813 9,064 755 9 Month Keywords - - - - - - - - 11,856 11,856 11,856 11,856 47,425 3,952

Total - 414 2,393 3,803 12,025 13,388 20,091 21,904 33,760 33,760 33,760 33,760 209,055 17,421

COS

Cost of Sale (40%) - 165 957 1,521 4,810 5,355 8,036 8,761 13,504 13,504 13,504 13,504 83,622 6,969

Total - 165 957 1,521 4,810 5,355 8,036 8,761 13,504 13,504 13,504 13,504 83,622 6,969

Total Gross Profit - 248 1,436 2,282 7,215 8,033 12,054 13,142 20,256 20,256 20,256 20,256 125,433 10,453

Sales & Marketing Costs

SEO Costs 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 30,000 2,500

- Net Profit - 2,500 - 2,252 - 1,064 - 218 4,715 5,533 9,554 10,642 17,756 17,756 17,756 17,756 95,433 7,953 Accumulative Net Profit (2,500) (4,752) (5,816) (6,035) (1,320) 4,213 13,767 24,409 42,165 59,921 77,677 95,433

Payback

Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12(10,000)

(5,000)

0

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10,000

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SEO Payback

Accumlative ProfitNet Profit

2 Year Profit Forecast

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

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Month 9

Month 10

Month 11

Month 12

Month 13

Month 14

Month 15

Month 16

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Month 18

Month 19

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Month 21

Month 22

Month 23

Month 24-4,000

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2 Year Profit Forecast

Net

Pro

fit

Tracking

Ongoing Tracking

1. Use Google Analytics2. Set up Conversion Goals3. Set up Goal Funnels4. Set up E-commerce tracking (if applicable)5. Set up Webmaster tools and monitor CTR6. Set up web ranking reports to monitor positions

This will allow you to track the Business Plan you are working towards

Google Analytics – Custom Reporting Pt.1

You can drill down by Source, then display:VisitsTransactionProduct Revenue

By Keyword.

This tells you which keywords are making money!

Let’s look at Real Data !

Real Data – CTR & Conversion(Month 11)

Keyword Local Search Volume Visits CTR Transactions Conversion Rate Income pcm Avg. Order Valuetrainers 201000 2884 1.43% 136 4.72% £8,153 £60running shoes 60500 1778 2.94% 74 4.16% £2,586 £35puma trainers 27100 1566 5.78% 74 4.73% £41,455 £560trainers sale 5400 2387 44.20% 87 3.64% £3,009 £35sportswear 33100 2772 8.37% 62 2.24% £1,901 £31crocs 110000 1529 1.39% 9 0.59% £187 £21football boots 135000 1516 1.12% 87 5.74% £3,879 £45nike trainers 70000 1516 2.17% 62 4.09% £2,660 £43reebok trainers 18100 1417 7.83% 49 3.46% £1,915 £39golf shoes 60500 1056 1.75% 12 1.14% £348 £29basketball shoes 22200 1032 4.65% 62 6.01% £4,189 £68sale trainers 720 557 77.36% 25 4.49% £823 £33running shoes 40300 1778 4.41% 74 4.16% £2,586 £35sports clothing 8100 509 6.28% 37 7.27% £1,889 £51england away shirt 2900 248 8.55% 24 9.68% £1,579 £66karrimor 20500 547 2.67% 49 8.96% £1,429 £29tennis rackets 27100 323 1.19% 24 7.43% £1,317 £55football tops 5400 280 5.19% 25 8.93% £1,330 £53adidas predator football boots 3600 418 11.61% 25 5.98% £1,001 £40sports wear 8100 506 6.25% 25 4.94% £848 £34

10.26% 5.12% £83,085

Predictions vs.. Actual Data

Subject Prediction Real Data(Month 11)

Difference

Visits for keywords 25,829 24,619 - 1,210

No. of sales 749 1,022 + 273

Average CTR 4.85% 10.26% + 5.41%

Average Conversion Rate

2.90% 5.12% + 2.22%

Income £33,120 £83,085 + £49,965

Average Order Value £44 £68 +£24

Actual P&L Year 1

Internet World 2010P&L

Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12 Year 1 Average

Income £ £ £ £ £ £ £ £ £ £ £ £ £ £

2 Month Keywords - - 415 1,049 2,061 1,264 2,204 1,666 2,602 1,606 2,890 15,757 1,432 3 Month Keywords 2,379 845 4,694 4,709 6,830 5,544 5,910 10,166 10,365 18,318 8,497 78,256 7,114 4 Month Keywords 659 868 302 699 590 1,124 302 1,157 5,481 3,860 7,098 22,140 2,013 5 Month Keywords - 720 4,006 4,574 3,863 3,241 1,033 7,153 18,026 12,326 5,595 60,537 5,503 6 Month Keywords - - 211 - - - - 1,239 1,859 - 1,317 4,627 421 7 Month Keywords 2,866 12,607 6,460 - 965 6,304 6,283 3,350 4,076 26,764 5,308 74,982 6,817 8 Month Keywords 709 393 - - 249 224 1,064 - 771 1,783 41,455 46,646 4,241 9 Month Keywords - 9,328 10,655 9,360 7,494 6,760 6,637 4,499 13,100 7,943 8,340 84,116 7,647

Total 6,612 24,761 26,744 20,391 22,051 24,460 23,434 29,229 56,281 72,600 80,499 - 387,061 32,255

COS

Cost of Sale (40%) 2,645 9,904 10,697 8,156 8,820 9,784 9,374 11,691 22,512 29,040 32,200 - 154,824 12,902

Total 2,645 9,904 10,697 8,156 8,820 9,784 9,374 11,691 22,512 29,040 32,200 - 154,824 12,902

Total Gross Profit 3,967 14,857 16,046 12,234 13,231 14,676 14,061 17,537 33,768 43,560 48,300 - 232,237 19,353

Sales & Marketing Costs

Existing Income 6,612 6,612 6,612 6,612 6,612 6,612 6,612 6,612 6,612 6,612 6,612 6,612 79,344 6,612 SEO Costs 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 30,000 2,500

Total 9,112 9,112 9,112 9,112 9,112 9,112 9,112 9,112 9,112 9,112 9,112 9,112 109,344 9,112

- Net Profit - 5,145 5,745 6,934 3,122 4,119 5,564 4,949 8,425 24,656 34,448 39,188 - 9,112 122,893 10,241 Accumulative Net Profit (5,145) 600 7,534 10,656 14,775 20,339 25,287 33,713 58,369 92,817 132,005 122,893

Actual Payback

1 2 3 4 5 6 7 8 9 10 11-10,000

-5,000

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10,000

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SEO Payback

Net ProfitPayback

Future Goals

Traffic vs.. Investment

12 months later you are ranking on the first pageAverage Ranking positions of 10 to 5.

How much is a top 2 position worth to you? How much are you willing to spend?

Traffic vs.. Investment

6-10 5 4 3 2 10%

500%

1000%

1500%

2000%

2500%

Increase in Traffic vs.. Increase in In-vestment

Traffic Increase %Investment Increase %

23 x more traffic in No.1 5.6 x more traffic in No.2 3.7 x more traffic in No.3

It is very likely that companies may need to double or triple SEO budgets to gain positions 1 & 2, this is well worth it!

Overview

Learning Objectives - Recap

Information

Predicting Organic Traffic to your websiteAnalysing the Potential IncomeStudying the investment requiredWorking out profit & loss for your Business Plan.Carrying out ongoing tracking of your predictions

Looking at long term goals by reviewing the potential from ranking between positions 10-5 against 3-1.

Question / Debate