Determining Your Budget for SEO Services: What to Consider

  • June 27, 2024
  • SEO
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Digital platforms are becoming the primary marketing channel for numerous companies.

However, many business owners and executives still face challenges when it comes to allocating budgets for online marketing initiatives.

Budgeting for SEO is particularly complex due to variables such as project scope, industry competition, and the distinct services required. A universal calculator for determining SEO costs simply doesn’t exist.

This article delves into the essential components of SEO pricing and offers guidance on how to calculate and effectively plan your SEO budget.

Understanding the Value of SEO Investment

SEO is an industry where you genuinely get what you pay for. Adequate investment in SEO services can considerably enhance your online presence and drive business growth.

Recent data indicates that more than half of SEO professionals manage monthly budgets ranging from $500 to $5,000, with 28.6% reporting budgets between $1,001 and $5,000.

Image from Search Engine Journal, May 2024

Many business owners are reluctant to invest in SEO, often due to a lack of understanding about how search marketing works and the time constraints associated with running a business.

Unlike standardized processes in many industries, SEO is often misunderstood as a commodity-driven service.

This misconception leads some business owners to opt for low-cost, “guaranteed page one” services that ultimately fail to deliver meaningful results.

The Real Cost of Inexpensive SEO

In my experience within various internet marketing groups, it is alarming to see inexperienced individuals posing as SEO experts and taking on clients.

Common queries such as, “I just landed a client who wants to rank for [keyword x] – how do I do it?” are prevalent.

Equally concerning is the use of link schemesprivate blog networks and third-party services, without disclosing the associated risks to clients. Many also use AI to generate content at a large scale without proper fact-checking.

While AI can be a valuable tool when used ethically in SEO, providing automation for data analysis, pattern identification, and content optimization, it’s crucial to avoid misuse.

Unfortunately, hiring an incompetent SEO can result in significant collateral damage, including cheap SEO tactics that may lead to Google penalties, effectively erasing a site’s visibility from search results.

Business owners are ultimately responsible for any SEO work performed on their site and should clarify the specific tactics a service provider will use before entering into an agreement.

Managing Your Resources Effectively

Google’s algorithm uses over 200 ranking factors (and likely many more), which can be overwhelming.

The good news is that focusing on three key factors can still lead to success, regardless of your industry:

1. Information Architecture

Your website’s structure should:

  • Facilitate easy navigation for users and search engines
  • Ensure that all important content is easily accessible
  • Utilize a clear and logical site hierarchy

2. Content

Your website’s content should adhere to the best practices outlined in the Search Quality Ratings Guidelines, emphasizing:

  • Relevance and usefulness to the user
  • High-quality, well-written content that addresses users’ needs
  • Regular updates to ensure content remains current and valuable

3. Backlinks

  • Acquire natural, high-quality backlinks from authoritative and relevant websites. Avoid manipulative link schemes like private blog networks (PBNs) and paid guest posts.
  • The focus should be on the quality of backlinks. A few high-trust, high-authority, and relevant links can outperform numerous low-quality links.

Effective Goal Setting and Budget Allocation

Prior to setting a budget, it is essential to define specific, measurable goals for your SEO campaign. These goals should include a clear timeframe and success metrics.

While keyword rankings used to be the sole measure of success, metrics such as organic sessions, goal conversions, and revenue have become more critical.

Example goals might include improving organic sessions by a certain percentage, increasing monthly conversions, or boosting revenue by a specific amount.

Goals should be realistic yet challenging, and crucially, it is important to allow sufficient time for the campaign to yield results.

According to Google,

“…in most cases, SEOs need four months to a year to help your business first implement improvements and then see potential benefits.”

Creating a Comprehensive Budget

Your goals will dictate the tactics necessary for success, forming a framework for your action plan and budget allocation.

Understanding the specific needs and priorities of your campaign enables you to determine the extent and type of work required. Regardless of the budget, the core tasks remain the same; the difference lies in the volume of work performed within that budget.

For instance, enhancing content and link acquisitions at a higher budget level will potentially yield quicker results. However, your budget should be sustainable for a minimum of six to ideally 12 months.

Lower budgets often result in a longer journey to success, so it’s imperative to plan for a long-term investment.

Expected SEO Costs

For a local campaign, budgeting between $1,001 and $5,000 per month is typical, based on a 2023 survey of SEO professionals.

National and international campaigns generally require a higher budget, frequently exceeding $10,000 per month.

Some firms offer lower-priced “trial packages” without long-term contracts, allowing businesses to test services with minimal risk.

For those unable to afford continuous SEO services, one-time SEO audits with actionable recommendations can offer substantial benefits. Addressing website issues can significantly boost organic traffic. Professional support for content development and keyword analysis is also available at fixed rates.

Another alternative is to become an SEO expert and manage your strategy independently.

SEO ROI: Measuring Success and Lifetime Value

Many commonly used ROI calculators for SEO fail to account for the lifetime value of a new customer.

Improper ROI Calculation Example

Example: selling blue widgets
Number of new customers acquired via organic search in a given month 10
Average net income (profit) per order $100
Total profits from new organic search customers in a given month $1,000
Monthly marketing budget (expense) $2,500
ROI = Total profits ($1,000) / Monthly spend ($2,500) -60%

This calculation overlooks the lifetime value of a customer, underestimating the true ROI.

Proper calculation should incorporate lifetime profits from new customers:

Average lifetime profits from customers acquired within one month divided by monthly organic marketing spend.

Proper ROI Calculation Example

Same example: selling blue widgets
Number of new customers acquired via organic search in a given month 10
Average net income (profit) per order $100
Total profits from new organic search customers in a given month $1,000
Average number of orders per customer over a “lifetime” 5
Total average lifetime profit $5,000
Monthly marketing budget (expense) $2,500
ROI = Lifetime profits ($5,000) / Monthly spend ($2,500) 200%

This variable significantly impacts the stated ROI, highlighting the importance of considering lifetime value in calculations.

SEO Campaigns as Long-Term Investments

Unlike PPC campaigns, which can yield immediate results, organic search campaigns require time and perseverance.

A comprehensive SEO strategy combines technical SEO, content marketing, and link-building to gradually enhance website recognition and rankings on Google.

While the journey may be slow, the resulting traffic is usually the most consistent and highest converting of all channels.


How do SEO professionals measure success?

SEO performance is commonly measured using key metrics such as click-through rate (CTR), keyword rankings, and the ratio of branded to non-branded traffic.

What is the most common budget range for SEO campaigns?

The most common SEO budget range is between $1,001 and $5,000 per month, with 28.6% of professionals managing campaigns within this range.

What are the primary factors that affect SEO budgeting?

Several elements influence SEO budgeting, including the scope of the project, industry competition, and specific SEO services required. For example, a small business in a niche market may budget around $1,000 monthly for local SEO services, while an ecommerce company in a competitive industry might allocate $5,000 to $10,000 monthly for a comprehensive strategy.

What risks are associated with choosing low-cost SEO services?

Low-cost SEO services can pose significant risks, often involving unethical practices like link schemes and private blog networks (PBNs). These tactics can attract penalties from Google, harming a site’s reputation and online visibility. Business owners should be cautious and select SEO professionals who adhere to best practices to avoid these detrimental effects.

More resources:

Featured Image: pattarawat/Shutterstock

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