Earlier this year, when I was first writing my advanced local SEO training, I reached out to some users who work for local SEO agencies and asked them what they'd like more training on. The biggest topic I got as a result was related to tracking and reporting value to small business owners.
My clients will often forward me reports from their prior SEO company, expressing that they have no idea what they were getting for their money. Some of the most common complaints I see with these reports are:
- Too much use of marketing lingo ("Bounce Rate," "CTR," etc.)
- Way too much data
- No representation of what impact the work done had on the business itself (did it get them more customers?)
If a small business owner is giving you hundreds or thousands of dollars every month, how do you prove to them they're getting value from it? There's a lot to dig into with this topic — I included a full six pages on it in my training. Today I wanted to share some of the most successful tips that I use with my own clients.
1. Stop sending automated Google Analytics reports
If the goal is to show the customer what they're getting from their investment, you probably won't achieve it by simply sending them an Analytics report each month. Google Analytics is a powerful tool, but it only looks awesome to you because you're a marketer. Over the past year, I've looked at many monthly reports that made my head spin — it's just too much data. The average SMB isn't going to be able to look at those reports and figure out how their bounce rate decreasing somehow means you’re doing a great job at SEO.
2. Make conversions the focus of your report
What does the business owner care about? Hint: it’s not how you increased the ranking for one of their 50 tracked keywords this month. No, what they care about is how much additional business you drove to their business. This should be the focus of the report you send them. 
3. Use dynamic number insertion to track calls
If you’re not already doing this, you're really killing your ability to show value. I don’t have a single SEO or SEM client that isn’t using call tracking. I use Call Tracking Metrics, but CallRail is another one that works well, too. This allows you to see the sources of incoming calls. Unlike slapping a call tracking number on your website, dynamic number insertion won’t mess up NAP consistency.
The bonus here is that you can set up these calls as goals in Google Analytics. Using the Landing Page report, you can see which pages on the site were responsible for getting that call. Instead of saying, "Hey customer, a few months ago I created this awesome page of content for you," you can say "Hey customer, a few months ago, I added this page to your site and as a result, it’s got you 5 more calls."
4. Estimate revenue
I remember sitting in a session a couple years ago when Dev Basu from Powered by Search told me about this tactic. I had a lightbulb moment, wondering why the heck I didn’t think to do this before.
The concept is simple: Ask the client what the average lifetime value of their customer is. Next, ask them what their average closing ratio is on Internet leads. Take those numbers and, based on the number of conversions, you can calculate their estimated revenue.
Formula: Lifetime Value of a Customer x Closing Ratio (%) x Number of Conversions = Estimated Revenue
Bonus tip: Take this a step further and show them that for every dollar they pay you, you make them $X. Obviously, if the lifetime value of the customer is high, these numbers look a lot better. For example, an attorney could look like this:
Whereas an insurance agent would look like this:
5. Show before/after screenshots, not a ranking tracker.
I seriously love ranking trackers. I spend a ton of time every week looking at reports in Bright Local for my clients. However, I really believe ranking trackers are best used for marketers, not business owners. How many times have you had a client call you freaking out because they noticed a drop in ranking for one keyword? I chose to help stop this trend by not including ranking reports in my monthly reporting and have never regretted that decision.
Instead, if I want to highlight a significant ranking increase that happened as a result of SEO, I can do that by showing the business owner a visual — something they will actually understand. This is where I use Bright Local's screenshots; I can see historically how a SERP used to look versus how it looks now.
At the end of the day, to show ROI you need to think like a business owner, not a marketer. If your goals match the goals of the business owner (which is usually to increase calls), make sure that's what you’re conveying in your monthly reporting.
As a local business owner, I have hired several outside SEOs over the years. The automated analytics report is particularly annoying. As it's my account, I can log in and see it whenever I need to. I did appreciate one SEO who help me setup a dashboard to cut through the data noise and see useful metrics.
Using "lifetime" value can be a warning bell to a business owner. It may well apply to some industries, but in mine it usually signals an attempt to exaggerate the data. I once had a yellow pages rep attempt to justify poor numbers (we had call tracking) by saying that just a few new customers from YP will multiply as they refer their friends over the coming years. What?!? The referral is earned by our great service, not anything YP did. Needless to say that meeting did not end well.
ROI is great, but one of my favorite metrics is cost per new customer. This helps to level the playing field across all trackable media. If I spend $10k on direct mail and get 150 new clients, that's $67/customer. What's my acquisition cost for PPC or SEO? With dynamic number insertion, these metrics should be accessible and it is very helpful to use the same metric (such as $/client) across all media.
Great post Joy. Thanks!
David,
I always appreciate when small business owners, not just web pros, chime in on these threads.
Your YP rep seems to have a different understanding of "lifetime value" than I do. I would look at that as how much a customer spends with you over time. Let's say my marketing brings your business a new customer who spends $100 in their first appointment, and $1000 over the course of a year.
And you tell me that your service is so good, that once you have a customer, they stay with you for three years, making the lifetime value of that customer $3000.
From your perspective, do you agree that the value I'm providing via that action is worth $3000, not their initial $100 spend?
I agree with you that it's incredibly misleading to suggest (as your YP rep did) that future potential referrals be credited to them.
Very good point @David Watkins from my point of view "cost per new customer" must be a mandatory field on every marketing report.
Yeah - while I don't actually highlight the cost per customer on the report, it would be easy to figure out with a little math. I prefer lifetime customer value only because I think it gives a better idea of what a customer is worth. An insurance agent, for example, might only write a policy worth $500 but if they know the average customer stays with them for 4 years, that's actually $2,000 in future revenue. Again, this is always an estimate based on averages since most business owners don't have CRMs that integrate with Analytics or AdWords.
David, I understand your thinking that your service is what gets you the referral and you're right. However if you didn't get that customer in the first place then there would be no opportunity for you to provide great service, and get the referrals. Surely the marketing company should get some credit for not only the initial sale, but also ongoing referrals from that sale?
I'm not trying to say the marketing dollars should get no credit for the referral. My point is that new clients lead to referrals no matter what the original marketing source. My direct mail clients are just as likely to produce a referral as an online client or *gasp* a yellow page client. Only exception being that referred clients produce dramatically more referrals. I guess being referred in the first place indicates deep social connections.
My point is simply that businesses like mine have a fixed (and limited) marketing budget. We look at ROI relative to other available channels. If a new client lands at $50 for online vs. $120 for direct mail vs. $300 for yellow pages, I as CMO have to make a decision on which to invest in. Trying to fold future referrals into the math merely obfuscates the comparison from one media to another.
The fact that a new client refers future clients is a great argument for spending marketing money, but a poor argument for why I should spend that limited budget with your particular media or channel.
Better would be to show that, rather than a one-time hit like direct mail, money spent in SEO is a long term investment. An optimized site will yield more new clients per month for years to come.
Great discussion!
Your passion and pursuit for sharing valuable info on SEO have changed a lot of people's Businesses for the better. Best of success to you and keep doing awesome work, Joy Hawkins!
Thank you :)
I calculate the budget that client should spend and what ROI they will get just by applying below calculation -
Numbers of Search (Per Monthly) — 50k
Av Google CTR (Click through Rate) — x 5%
Now, visits to website (Monthly) —2500
Avg. Conversion Rate — x 5%
Potential New Costumers —125
Av. Value of a Sale — $100 (Minimum)
Additional Sales Each Month — $12,500
This is just an example, the numbers of search of keywords can be vary, the CTR % can be vary and the Conversion rate can be vary. But this could help we both to understand the ROI rather than speaking in the air.
Hope this helps !
Thanks for this wonderful post I really got many valuable information through it. As a learner it's not so easy task to understand ROI quickly but this post tell a lot.
Helpful article, and great tips, since local Seo is going to be very important soon; thumbs up , quite easy to read and understand even for a spanish speaking person like me. Well done.
Hi Alex I am also a spanish speaker to, where you from?
This is a great piece Joy, thank you.
I love the idea of showing clients an estimated revenue from our services, but I've found it extremely rare for a small business owner to have data on lifetime value and/or conversion rates. Most of the time, it seems like they just go off of gut feelings of how their business is doing or whether or not "the phone has been ringing" : |
Do you run into this also? Any suggestions on how to best help them?
Really like the idea of estimating revenue, as well as before and after screenshots, something I think not being people are doing when reporting to clients.. Solid post and great tips for all my local SEOs out there!
Great stuff here!
Thank you for this article. I have been having trouble showing value of my services to some clients. I will be looking into bight local and CallRail.
This a really useful on my day to day. Sometimes is not easy to explain some concepts to people that is unfamiliar with tech and marketing world.
Thanks for share
I was a yellow page rep, and I learned the lifetime value from a customer who happened to be my hairdresser. He said his ad broke even every month, with 6 or 7 people coming in for a haircut. But one in every 10 customers became a high value customer, coming back 10 times or more. And once a quarter he got a super client - he said "Like you - you've been coming here off and on for 15 years and you've spent over $10,000 with me. And you originally came from my yellow page ad."
Very few people ever looked at it that way.
We once had a dentist who not only tracked the revenue from his customers, but credited his yellow page ad with the referrals that customer made. But that was a once in 15 years client.
Hello, I have been SEO for several years and I have been working with local seo, and what we always do and I think it is very important is to do a previous analysis to have a real image of what there is, and then get to work , Since otherwise you will be able to demonstrate to the client your work done. I mean a complete analysis on page and off page.
I am a number nerd by nature and it's so hard to not bludgeoned people with statistics. Recently, we did a campaign for a canyoneering outfitter and guide. The owner was an ex financial guy so he could hang with the statistics and asked good questions too. Pretty soon, he came to the point of "what is this going to do for me?" How does the rank and reach relate to customers through the door. It was harder for me to answer that question that it should have been. We are tracking his campaign now with a series of before and after screen shots instead of just straight up statistics so he can see the growth.
Tracking ROI and 'where the dollars go' is literally how we quadrupled our business over the last few years. No SEO knows how to do this stuff half the time and they rely too much on 'rankings'. Cool.
Business owners don't give a rat's butt about rankings...they want the phone the ring and new customers.
Nice post and any SEO who wants to blow up their business will pay attention to this article!
Very interesting points to increase your ROI from local SEO campaign.
Excellent blog post. This really helps to identify the key points. My favorite, #1. Automated reports quickly get sent to the circular file. If possible, schedule a 10 minute phone call to go over custom notes from the client's monthly report.
After all the calculations, it only comes downs to this:
I paid you X amount this month, and you produced X amount in revenue.
To measure ROI, I like to find out the business owners objectives in regards to what they are looking for from SEO. Different businesses have different margins on each of their products/services so I like to find out the highest marginal product/service and target those keyword phrases for the business owner. I like to go after what they value the most so I can bring the most value to them.
Interesting article and will help me to communicate better with my clients. I understand that all clients want results because they are investing in SEO. But many of the problems of not getting conversion lies in the same company, by not correctly attesting to their new customers.
I have been able to check with one of my clients that I did not check the budgets received through the contact forms or to make a telephone follow-up of the requests.
We are not magicians, we do our job of generating traffic and sometimes companies do not know how to take advantage of this.
A greeting from Spain.
Sergio
Awesome tips Joy! That ROI metic is huge for local business owners, and also explaining to them that rankings will come, but you are focused on getting them "results, not just rankings" is a great expectation to set for clients.
This is really a great work, Joy!
We are helping local businesses through our local SEO strategies as per their requirements. Your tips are effective. We will try to further implement those in our working procedures. We hope clients will like it. Do post some more informative ideas so that it helps business enterprises and entrepreneurs. I think estimating revenue is very important.
I really liked the way you focus on the business KPIs for reporting, instead of rankings. Apart from that light bulb moment, I think the last advice of sending a SERP screenshot instead of a ranking tracker it's really clever. Thank you for the advices!
Hi Joy I have 2 question for you
from your experience
1. Which are the best Local SEO tools or services? you mentioned BrightLocal in your post.
2. Which are the best SEO Reports tools or services?
The 2 I use consistently for pretty much every client are Bright Local & Get Five Stars. Obviously Moz's tools are good too for research too ;)
Thank you Joy!
I will take it into account from now on with my local campaigns.
Thanks Joy! Very simple ways to show progress, but so powerful to both the marketing team and the business owner. I've been on the fight to get rid of keyword ranking as a KPI for clients, and use LTV to help them understand who is the right customer to market to.
I really love the idea of using LTV to show MY value to the client. I didn't think of using it that way before, so thanks for sharing the light bulb moment with everyone else! Keep up the great work.
I had a light bulb moment when I heard it from Dev too. Glad to share the feeling!
So true. One can always argue about which metrics should be used and how they're calculated but the important message - which I agree with - is that the focus should be on value added and not stuff like ranking reports. I usually overdo the detail in my reports and have recently been moving towards presenting high level data in graphs which can convey a message in a heartbeat. For those clients that need the analytics minutiae, it's there if they want it.
If you're reporting on value, I don't think you can overdo it unless you make the report too long in which case the owner might not have time to read it all. Personally, I spend about an hour creating a monthly report each month PER client.
Joy, do you ever worry about being able to scale that activity as you add more clients?
No, but I also only offer SEO packages that are priced high enough to make sure the person working on the monthly report each month is either myself or someone with a ton of experience (like Colan Nielsen, who I just hired as my VP of Local Search). The agency I used to work at had 1300 clients and scalability was a big goal of theirs. With my company, my current goals have nothing to do with scaling and everything to do with quality. I want to grow slowly and actually cap the number of new clients I take on and turn business away regularly. After all, it costs 4x more to get a new customer than to retain an existing one.
Nice summary and a good reminder that although we might be familiar with in-depth data, it's often either disregarded or irrelevant to a business owner. Ultimately, if you can align everything to as far as possible to the revenue they've gained, or the savings they've made as an alternative to other channels, then you won't generally go too far wrong....
Although I still have the odd example of business owners even refusing that information - having gone through in detail how SEO was delivering new customers to a business over the course of a 60 minute meeting, the owner agreed, and then said he wanted to focus on his new Facebook page instead...
Loved your tips Joy! I'm getting into doing more local for clients myself :) I have to admit that I don't suggest call tracking nearly as much as I should. And I 100% agree with the tip on rank tracking!
Very useful tips, incredibly insightful as always. Thank you!
Thanks for this article. Very useful. I've been looking for something similar. It will be of great help to me
Very helpful article to improve SEO,
Your Writing Skills are Nice, easy to Understood.
Thanks For Sharing, Keep doing work
Great stuff, I especially like the ROI images
Very interesting, thanks for sharing your valuable insights! Local SEO is going to be the future and as we all know Google and Bing are aggressively investing in Location based SEO. With the advent of Voice Search and AI, this is going to all new level. Estimate Revenue for indeed a light-bulb! Keep up the good work.
This blog is full of spanish people :), we beg Moz to put MOZ Local for Spain soon
Thanks for sharing such a useful information, this kind of article is useful for both experience and newbie in industry. ROI is most valuable and respected word in any business.
Very nice article and easy to read. I think a lot of companies just send out analytics reports and we get a lot of the same questions from clients, so it's nice to see other people experience the same. Thanks for the article!
Thanks for this informative post..These 5 tips are really helpful when your website is target for local audience.
I run a digital marketing academy called digital marketing academy india, it was really helpful for my business and this post is really informative.