How Much Should You Be Spending on SEO?

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Nearly every business today must make a decision about how much to spend on search engine optimization (SEO).  This is no longer an “if” question for businesses as a robust online marketing strategy is imperative for survival in a web-driven world.

“How much will we spend on SEO?” is the question that every business professional must ask themselves in 2014.  One of Search Engine Watch’s 10 most popular stories of the 2013, written by Jayson DeMars, took deeper look at SEO spending.  Here are a few helpful tips from DeMars, and hopefully all the information you will need to help make a decision about hiring an SEO agency and forging a crucial partnership with an online marketing firm.

SEO Payment Models

To get a better understanding of the dollars and cents you will be spending on services, it is important to understand the payment models used by agencies.  Typically these agencies offer four main forms of services and payment:

  • Monthly Retainer:  Clients in this model will pay a set fee each month in exchange for an agreed-upon array of services.  This is the most common payment model because it provides the greatest return on investment (ROI).  These arrangements commonly include regular analytics reports, on-site content improvements, keyword research and optimization.  (Average Range of Rates: $750-5,000 per month) 
  • Contract Services at Fixed Prices:  Typically before a client is ready to engage in a monthly retainer, they will select contract services they wish to have completed.   SEO agencies will commonly list their services on their site, along with a price.  An example of one of these services could be an SEO website audit, which will help determine your current strengths and weaknesses as well as keywords with the highest ROI potential.  (Variable Prices dependent on services)
  • Project-Based Pricing:  Project fees are similar to contract services, but they are customized specifically for the client.  Pricing will vary according to the project.  A local business may want an agency to help with local online marketing by establishing social media accounts.  Together the business owner and the SEO agency will decide on the scope and cost of the project.  (Variable prices typically between $1,000 and $30,000)
  • Hourly Consulting:  This familiar consulting model is an hourly fee in exchange for services or information.  (Average Range of Rates: $100-300/hr.)

Things You Should Be Suspicious of

With the amount of money you will be spending on SEO, it is important to heed a few warnings to ensure that you are getting the best service available.  Be suspicious of the following promises:

  • Guarantees – SEO firms generally cannot provide guarantees due to the constantly changing nature of the industry.
  • Instant Results – It is true that using some SEO tactics will garner “instant results” by gaming the system, but these can hurt you in the long run.  Instant results often involve SEO practices that are against the webmaster guidelines put out by search engines.  Major search engines like Google seek out these techniques and penalize them, resulting in a loss in rankings that could take months to make up.
  • #1 Spot on Google – It always sounds great when a company makes a promise like this, and hopefully you will be able to get it.  However, this is not something a firm can promise to hand over to you.
  • Costs Lower than $750/Month – When it comes to SEO, it is always great to find a bargain, but you really are not shopping for the lowest price.  What you should be looking for in your SEO agency is the best level of service.  Be wary of rock bottom prices or “unbelievable deals.”
  • Shady Link Building Services – Link building is an incredibly important part of SEO.  It is impossible to have a highly-ranked site without inbound links.  As with most things, there is a dark side of link building.  Link trust is gaining importance to appear high in the rankings.  Make sure your agency’s link building services are ethical, white label services.  You may even want to ask them where they may be able to gain links for a business in the hospitality industry.

Things to Keep in Mind

  • SEO Takes Time.  A Monthly Retainer is Best. You must think of SEO as a long-term investment.  Aggressive campaigns and major pushes have their place, but the best and most enduring SEO results come from a long-term relationship.  The best agencies do not just wave a magic wand and get instant results.  Instead, they perform extensive operations that will produce results months down the road.
  • SEO Changes, and Your Rankings Will Change, Too.  There are plenty of competitors out there for your company to battle, and rankings will rise and fall with the changing of algorithms along with the entrance of new competitors.  It takes constant monitoring to keep your website ranking high on results pages and performing at top-notch levels.  Stay away from the one-and-done SEO tricks that simply do not work!
  • Not All SEO Services are Created Equal.  You have to keep in mind that SEO is not about shopping around for the lowest prices.  You should be focusing on finding the finest agency you can.  An SEO agency that defines its scope of services and takes the time to educate you is what every company should be looking for.
  • SEO is Important.  Do it.  The point of having a website is to increase and/or improve your business.  Unless people are finding your website, it is not even worth having one.  Do the smart thing and pay what it takes to keep your site findable by the people who are looking!
  • Hiring an SEO Agency is Best.  Do not fall into the mindset that you will be able to manage your SEO on your own.  A tiny percentage of business owners or professionals have the skill and savvy to do their own SEO.  On top of this, comprehensive SEO takes much more time than most business owners can afford.  Save yourself the stress because more than likely you will never get the same level of ROI that you would with a competent SEO agency.

For many modern businesses, SEO is the highest ROI marketing effort.  Direct mailing, broadcast advertising, online ads and other forms of advertisement do not provide the value SEO can.  It is no longer a question of whether businesses will spend, but how much to spend. As long as a quality SEO agency is the choice, the decision has the potential to lead to incredible amounts of revenue.

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