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How to Calculate SEO Traffic Value

Posted by on in Adult SEO
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I've worked with a lot of adult webmasters and affiliate programs over the past 12 years and whenever goals are discussed I'm often told that the goal is traffic. The common perception of Adult SEO is that ranks equal traffic equal revenue. But this is not always the case, and it's at these times that companies get their ranks and their traffic, but not their expected revenue.

It's every Adult SEO's responsibility, especially when working for clients, to avoid these problems by calculating the actual value of the traffic they're working so hard to get. The process itself should not be difficult and can be easily integrated with other initial analysis such as keyword and competition research.

Keyword Research is necessary because it reveals the highest traffic search terms to target. Competition Research is necessary because it reveals the most viable path to a top ten rank. And Traffic Valuation is necessary because it reveals which of those paths will be most profitable. If you haven't yet read our guide on competition research I recommend you do that now before attempting traffic valuation. The section on the quality and relevancy of competing sites is especially useful when calculating your potential traffic value.

SEO traffic valuation is essentially the process of comparing potential traffic volume with your average conversion rates. Before you can do this however you first need to understand how traffic is typically distributed among the top ten positions of a Google search results page. The following image illustrates the general traffic distribution.



You can use these traffic distribution estimates along with your keyword traffic estimates to calculate the traffic volume you can expect to receive from various ranks within the top ten. And these traffic estimates divided by your average conversion ratios can tell you if the particular keyword you're looking at will be profitable for you, or possibly what rank you will need to earn before profits can be expected. And if you're paying somebody to do the SEO work for you, you will need to calculate in this expense in order to arrive at an accurate keyword/rank combination goal.

The SEO traffic valuation process

To illustrate the traffic valuation process I will use the example keyword phrase "free sex chat". This phrase works well for webcam programs and is targeted by a lot of Adult SEO's as well as pay per click marketers, making it a valuable phrase for cam sites to rank for. As you can see from the following screenshot this keyword phrase has a daily estimated traffic volume of 7,595 clicks, it competes with nearly 4 million other sites and it has an average AdWords cost per click rate of $6.14. All of these metrics indicate that it is a valuable keyword phrase.

keyword-metrics-1.jpg

(Download Market Samurai)

Next we want to look at the strength of the current top ten competitors. For this example we will assume that we have the resources and ability to compete for this keyword phrase, so in the following screenshot we are simply looking for which currently ranking sites we're going to try to overtake. Using total backlink counts (BLD) as our target metric I have selected the three ranking sites to focus on.

keyword-competition-2.jpg

To start our traffic valuation I am going to first look back at the potential daily traffic for this keyword phrase. We can see that it has an SEOT of 7,595 which specifically means that this is the potential daily click volume that the #1 ranked site can expect to receive. So if the #1 ranked site gets 7,595 clicks per day, how much does our new target #8 ranked site get? To get this number I'm going to refer to the traffic distribution chart above, which shows that all sites ranked #5 - #10 share in 6% of the traffic. However before I can calculate what 6% of this traffic equals I first have to determine what the total daily traffic volume is. The chart shows that the #1 ranked site gets 34% of the traffic, which means 7,595 is 34% of 22,338 and 6% of this is 1,340 clicks a day to the #8 ranked site.

Now we know that once we're ranked #8 for this keyword phrase we can expect around 1,300 clicks a day, so next we'll need to look at our average conversion ratio to determine how many sales per day this might equate to. Ideally you will want to find your average conversion ratio of actual organic Google traffic, but for this example we will use an average of 1:900. 1,300 divided by 900 equals 1.4 sales per day, or 42 sales per month. With this potential sales count at hand you can now calculate your expected revenue and use it to determine the value of these sales to your company. Having a figure like this to work with is especially helpful when planning an SEO campaign, since you may or may not decide it's worth the investment required to earn the ranking.

This same process can be used to calculate the traffic value for ranks #4 and #1 as well. Earning the #4 rank has the potential to make 82 sales a month and the #1 rank has the potential to make 253.

In summary, there are many variables that will play a role in both your traffic and conversions which means the traffic values you calculate should always be a loose estimate rather than an expectation. However even a loose estimate is a valuable figure to have since it can predict your earning potential for any number of keyword phrases. This is especially useful when you're offered keyword recommendations by a paid SEO consultant, or when you're the consultant and you need to be sure that your clients target phrase will be profitable for them.

For more on subject related to traffic valuation please read though our Best Practice Guides on Keyword Research and Competitive Research.

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