Investing in your Search Engine Optimization strategy is an excellent choice if you want to scale your business. SEO can boost your brand’s digital presence, driving organic traffic to your site, boosting conversions, and increasing sales and revenue.
But, even with that knowledge, many companies still struggle with how much to allot in their SEO marketing budget. Determining the clear-cut amount for SEO can be challenging, as each company has unique marketing objectives, funds, and offerings.
While there is no universal formula for setting an SEO budget, a few strategies can help you find the correct number for your business. But before that, let’s look at how other companies will do their digital marketing strategy in the coming months.
How are CMOs allocating their budget for digital marketing?
The COVID-19 pandemic has drastically affected businesses from all scales, forcing executives to hit the budgetary brakes toward SEO and other digital marketing services. However, as many businesses return from strict lockdowns, companies are starting to go back with their budgeting to pre-pandemic levels.
Gartner’s recent State of Marketing Budget and Strategy reported that CMOs would allocate 9.5% of their company’s revenue to marketing in 2023, with 8.5% of that being spent on SEO.
While this is a few percent short of the 10.9% average spending rate before the pandemic, 2022’s number significantly increased from 2021’s 6.4%. And to top it all off, senior marketing executives are not planning to slow down even amid the rising fear of the recession.
The Matter 2023 Marketing Outlook Survey recently reported that 89% of CMOs plan to increase their marketing investments in the next 12 months, with a strong emphasis on content marketing, PR & social media, and video marketing.
Why CMOs bullish on digital marketing in 2023?
Despite economic uncertainty and concerns of an impending recession, CMOs and marketing directors are still planning to double down on their digital marketing budgets in 2023. Recent data from KPMG’s 2023 CEO Outlook reveals that more than 80% of CEOs anticipate a recession in the coming months, with more than half expecting it to be short and mild. Despite these concerns, industry leaders and executives remain optimistic about economic resilience and potential growth in the next three years.
The pandemic has drastically changed the marketing landscape, and businesses that previously relied on traditional marketing methods have had to pivot and invest in digital marketing channels to stay afloat. In a survey conducted by Matter Communications, it was revealed that 34% of senior marketing heads increased their marketing budgets in 2020-2021 despite COVID-19 restrictions, with 71% of them experiencing growth in the following months. Conversely, those who decreased their marketing budgets are planning to increase them in the coming months, with 90% of CMOs being bullish about digital marketing in the coming year.
It’s clear that businesses that have invested in digital marketing during the pandemic have seen positive results, and the trend is set to continue in 2023. The pandemic has accelerated the shift towards digital channels, and this trend will likely continue even after the pandemic subsides. Businesses that invest in digital marketing now are likely to see long-term benefits and be better equipped to weather any economic storms that may come their way.
As the Matter CEO, Scott Signore, put it, “Marketers understand that while cutting marketing and advertising budgets during economic uncertainties may bring temporary financial relief, it often leads to significant long-term strain on sales pipelines, brand awareness and customer trust.”
How much should be my SEO budget?
Now that we’ve established that companies will continue prioritizing their digital marketing efforts in the next 12 months, it’s the perfect time to develop an impactful SEO campaign that will drive your business to success.
To ensure you don’t go under or over budget, consider asking yourself these 5 questions to gauge how much you should spend on your SEO efforts. With these considerations in mind, you can create a sustainable SEO approach custom-fitted to your goals and target market.
1. What are my digital marketing goals?
To ensure that your SEO budget is highly effective, aligning it with your broader marketing objectives and business goals is essential. Consider your goals and marketing metrics: are you looking to establish brand awareness, increase organic traffic and conversions, or maximize your ROI through lead generation and sales?
Here are some more examples of digital marketing goals to give you a clearer picture on how much you should allot for your SEO budget:
- Increase Brand Recognition: If you're new to the game, this is the way to go. A well-rounded approach to SEO can help you showcase your brand’s uniqueness through optimized content, as well as through social media marketing, link building, and influencer collaborations.
- Establish Brand Authortity: If your goal is to make your brand the eventual “go-to” site for updates and other industry-related information, then establishing a solid brand authority should be your priority. Creating carefully crafted blog posts and collaborating with prominent industry experts are just a few ways to showcase your expertise in your field.
- Generating High-quality Lead: You must create high-quality content tailored to their needs if you want high-quality leads. Offering curated lead magnets such as e-books and free courses can attract potential leads to your brand, along with targeted ads and email marketing for nurturing.
- Increase Customer Value: If you want to foster a strong relationship with your prospect, increasing customer value might be a great idea. Using SEO to create a personalized messaging scheme can help you build meaningful connections and interactions with your customers.
Based on these objectives, you can determine the amount and type of work required. With clear objectives in mind, you can develop an SEO budget that delivers the desired results at a cost that makes sense for your business.
2. How well is my website optimized?
Before deciding how much to spend on SEO, you must understand your website traffic and rankings in search engines. Know the number and quality of your inbound links and any technical SEO issues that need to be fixed.
Does your website have a lot of technical SEO issues? Does it even rank at all? If so, you’ll likely need a bigger budget to experience gains since it takes more time and effort to make significant progress starting from a low base.
On the other hand, if your website has decent optimization, you can scale back and allocate more to other areas such as website maintenance, local SEO, paid search, and other digital ad strategies.
Having an SEO consultant can help assess and identify areas that your website needs to improve. With their expert SEO audit, you’ll have an idea of where your SEO presently stands, allowing you to have an informed decision with your business.
3. What’s the current state of my SEO strategy?
Do you already have existing SEO strategies, or are you starting from scratch?
On average, it takes 4-12 months of consistent SEO efforts to see noticeable results on your website. SEO typically generates results in a much longer time, especially for fresh brands and businesses, depending on the quality of content, user interface, backlinks, and other factors. Here are a few example of SEO strategies you might want to consider:
- Content Marketing: Creating high-quality and relevant content that provides value to your target market. This includes identifying your target audience’s interests and pain points and offering reliable solutions to address their concerns. This strategy works well if your goal is to position your brand as an industry leader in your niche or drive traffic to your website.
- On-page Optimization: Even if your content is top-notch, it’s unlikely to be found without optimizing it for search engines. On-page optimization involves using appropriate keywords, meta tags, and other techniques to increase your brand’s visibility and attract leads. However, it’s essential to strike a balance between making your content SEO-friendly and maintaining a human-first approach, so your content is both easy to find and enjoyable to read.
- Link-building: Building high-quality links from credible sources is another important long term SEO strategy. By collaborating with other brands and creators, you can create content that links back to your website and improve your site’s authority and ranking. However, being selective about who you partner with is crucial, as linking to spammy websites can harm your website’s reputation and rankings. Building strong relationships and collaborating with other high-quality websites and creators is critical to a successful link-building strategy.
Contrary to popular belief, SEO is not “free.” Search Engine Optimization is a long-term investment that demands patience and dedication from your end to thrive in the ever-competitive market.
If you’re currently running an SEO campaign that works in your favor, it’s probably best to remain consistent. If you don’t have one, it’s best to allocate more budget for SEO.
4. How Aggressive is the Competition?
The competition in your industry will affect how much you need to spend on SEO.
A highly competitive industry will require a bigger budget to help you rank above your rivals. It takes more time, effort, and resources to improve your ranking when there are already a lot of other websites trying to do the same thing.
To get an idea of the competition in your industry, conduct a quick Google search for your target keywords. See where your business ranks and take note of the companies that are above and below you.
The competition is intense if most of the results on search engine results pages (SERPs) are from major brands or well-established firms.
You can also use specialized tools, like SEMrush’s Keyword Difficulty Tool, to get an even more detailed look at your competitor’s organic traffic and organic search.
5. What other marketing channels do I need?
Sometimes, SEO is not the best way to allocate your digital marketing budget. Depending on your current business needs, there are other effective marketing channels that you’ll get a significant boost from rather than prioritizing SEO.
For example, if you’re launching a new brand or product, focus on brand-building initiatives like pay-per-click (PPC) campaigns and Google ads over SEO.
SEO is a better use of your resources if you’re trying to hedge your brand as an information authority in your industry. This helps your business grow a more substantial customer base and increase sales. Additionally, it can help you reach more qualified leads who are already interested in what you have to offer.
Alternatively, combine different marketing channels to create a well-rounded strategy. For example, you can use SEO to drive traffic to your website and then use retargeting ads to convert those visitors into customers.
The Holistic SEO Strategy
If you’ve heard the saying in investing, “Never put your eggs in one basket,” then a holistic approach perfectly captures the thought.
SEO, by it’s nature, touches many areas in digital marketing both directly and indirectly. So why stick with one area where you can have split your seo budget accordingly? Here are concrete use cases you on how to integrate SEO in other areas of digital marketing:
- Affiliate Marketing: Affiliate marketing and SEO both rely on quality links. SEO uses backlinks to enhance a website’s authority, while affiliate marketing uses links to drive sales. Leveraging your insights from affiliate campaigns can help you better understand your target audience and adjust your SEO strategy accordingly.
- Social Media Marketing: SEO and social media marketing can work hand in hand to expand your brand’s reach and visibility. By optimizing your social media posts with relevant keywords, you can increase the chances of your content appearing on search engine results pages. Similarly, promoting your blog content on social media and vice versa can help you engage with your target audience and achieve your marketing goals effectively.
- Email Marketing: SEO and Email marketing has distinct aspects that, when combined, will yield you with incredible results. SEO is best for lead generation, while email marketing excels in lead nurturing. Optimizing you website and creating lead magnets will attract prospects to your mail list. From there, you can use email marketing to nurture you leads and direct them back and forth to your website with your content. This integrated approach can help you build brand loyalty and boost your sales in the long run.
Using SEO in conjunction with other digital marketing strategies is one way to put your eggs in multiple baskets. Consider all the other channels you’re using or need to invest in and how they fit into your overall marketing strategy. By taking a holistic view of your overall marketing budget, you’ll be able to make more informed decisions about how much to spend on SEO.
Maximize ROI with holistic SEO Services
While investing in SEO services requires patience and a significant portion of your marketing budget, it can yield scalable benefits for your business in the right hands. To ensure that you make the most of your investment, take the time to understand your business needs, goals, and competitive landscape, and develop a realistic SEO budget accordingly. By laying the groundwork for a long term seo budgeting approach, your site will eventually generate consistent leads and sales in no time.
For advanced insight, consider working with experienced SEO specialists like Search Leads, who can help you look for the most impactful SEO opportunities and plan an effective marketing strategy tailored to your business.
Contact Search Leads today and take the first step toward long-term success.