How to Explain the Value of SEO to Executives — Whiteboard Friday

In at present’s episode of Whiteboard Friday, Seer Interactive’s Larry Waddell discusses how one can translate the search engine marketing work you do on your shoppers into how executives consider worth — particularly, enterprise worth.

Click on on the whiteboard picture above to open a excessive decision model in a brand new tab!

Video Transcription

Howdy, Moz neighborhood, and welcome to a different version of Whiteboard Friday. I am Larry Waddell, EVP of Enterprise Technique for Seer Interactive, and at present I need to discuss to you about find out how to translate the good work you do on your shoppers into how they consider worth, particularly enterprise worth.

So let’s soar proper in. Now to do it, I will assessment two frameworks or two methods of pondering. One is the worth pyramid. That is the place we will begin. However then we will transfer from there to the 4 types of enterprise worth, and I am going to stroll you thru that.

So beginning with the worth pyramid, and that is one thing I’ve used at Seer for years, and I’ve had the good privilege of main the Analytics crew at one cut-off date, the search engine marketing crew, thanks Wil, and the Paid Media crew, thanks, Crystal, and thru all of that, I’ve used a quite simple assemble. As you may see, there’s nothing terribly fancy right here, however it’s a manner to assist our groups perceive the work that they do and to know the work the shoppers are asking us to do.

So to start out, it is a pyramid like every other, 4 completely different layers, and for search engine marketing you may take into consideration the underside layer as one thing like hyperlink constructing. It is one thing crucial to do, extraordinarily essential, however maybe on the backside of the pyramid. Hyperlink constructing we get rankings. With rankings, we get site visitors.

Visitors will get us engagement on the web site. However we do not cease there in fact. Engagement on the web site and site visitors, now we need to concentrate on conversions. Now we get these conversions and relying on what our conversion worth is, that will get us to income. So actually nothing earth-shattering there. However I need to introduce a pair different ideas. So that you may need to take into consideration titles at your shoppers.

So in case you’re down right here, maybe on the backside of the worth pyramid, perhaps it is hyperlink constructing, perhaps it is different low-level however crucial duties, you may be coping with any person who’s a specialist or a supervisor at your shopper daily. As you progress up this pyramid, the place you are speaking about issues like income and you have been in these conferences, you’ve got had these folks be a part of your QBRs or they pop right into a weekly name or a month-to-month name, and so they have titles like director or VP or CMO.

Each occasionally, you may get a director of finance or a CFO in these conferences. You may additionally have seen that these conferences are usually extra strategic. They are usually specializing in issues aside from the nitty-gritty tactical that you just may be grinding out daily along with your supervisor on the shopper.

These of us are frightened about enterprise issues. They’re frightened about issues which might be impacting the trajectory of the general enterprise, of which search engine marketing performs a vital half. Down right here, maybe much less visibility into these issues on the shopper, however down right here we’re targeted extra on search engine marketing issues, rankings, how a lot site visitors are we getting, what are our conversions, content material on the location, load speeds, and people kinds of issues.

It is not that these of us do not care about that. They’re simply maybe faraway from it, and so they do not essentially perceive how any of these items down right here impacts the stuff that they care about until we’ve got lots of clarification and we have all been there. So what can we do with one thing like this? Properly, we will begin to consider a speculation round worth.

What if there’s higher perceived worth on the a part of these of us on the shopper, the upper up this pyramid you occur to be? So down right here, once more, essential however maybe much less perceived worth than strategic conversations that relate to enterprise issues at your shopper. So what are the issues to fret about down right here?

There’s truly quite a bit to fret about down right here. So in my expertise, you probably have engagements that are likely to focus totally on speaking about, reporting on, and reviewing exercise on the backside of the worth pyramid, you may get locked into simply doing that on your shopper.

The best way I like to consider it’s that is the large children desk or the adults desk maybe. How can we get a seat at that desk? Once more, in my expertise, if these of us do not see a method to translate what you do into what they care about, you sort of get relegated down right here.

Once more, there’s nothing unsuitable with it. However the issue is, if we take a look at payment competitors, it tends to be the case that there is increased payment competitors down right here than there may be up right here. There tends to be extra opponents down right here. There’s much less differentiation between suppliers down right here. You are extra inclined to being ChatGPTed, for instance.

You are extra inclined to getting huge knowledge out or automated out. You’ve got seen some nibbling across the edges round issues that you just may characterize as tactical. Increasingly more of it’s turning into automated or ok automation. Possibly it is not good, however it’s ok. Then I can avoid wasting cash as a result of down right here there’s excessive payment competitors.

You’ll be able to see the robotic there coming to get us. So the factor that we have to do is consider how we transfer up this pyramid, each within the work that we do and the way we discuss in regards to the work that we do with shoppers. So, once more, that is shifting up the worth pyramid and tying extra of our work to the enterprise issues that these of us, VPs, CMOs, administrators, CFOs care about.

One other manner to consider this too is profession development. So in case you begin off in search engine marketing, you may begin down right here. You may begin doing content material audits, and also you may begin doing hyperlink constructing and issues like that. Once more, crucial issues to do. However then over time, this additionally creates a path so that you can form of take into consideration the place you may go as you begin to unpack a bit of bit extra of how progressively extra subtle work you might be doing for shoppers interprets to worth for these folks, as a result of it seems these folks management the finances.

So you may also have found that when it is time for renewals or pitching work, that oftentimes there is a huge boss and that huge boss sits up right here, usually not down there. In order that will get us to worth. Now, once we take into consideration conversions and we’re enthusiastic about income generated from our work on a shopper web site, we are likely to concentrate on the income of that, and income is extraordinarily essential.

We won’t get wherever if we’re not producing income or extra income for our shoppers. So income for the win. You’ll be able to see it proper there. Properly, sure and no, and that will get us to the 4 kinds of enterprise worth. So there are at the very least 4.

There is a fifth that I am going to contact on briefly in a second. However for essentially the most half we will improve income, however ah, not so quick, gross revenue. We are able to cut back value. We are able to do one thing which is known as value avoidance. We may also help our shoppers keep away from value. Then there’s insurance coverage worth.

In my time at Seer, I’ve discovered us in tasks that do a number of of this stuff, oftentimes with out our crew even realizing that they are creating this extra worth. Now down right here there’s a bit of little bit of an economics lesson, and that is known as a utility curve.

I am going to get to why that is essential in a second, and it will assist me clarify why a few of these issues over right here create worth, how that really occurs. However let’s return to rising income, gross revenue. So questions you may take into consideration in case you’re targeted right here. Are you producing extra income on your shopper, or are you stopping at income?

I recommend we take a pause to essentially contemplate that. We have had conditions the place we may be producing extra income for the shopper, however it seems that the unit economics are such that on the gross revenue stage, the shopper may be shedding cash on all the things we assist the shopper promote. So regardless that all the things over right here has been geared in the direction of up and to the suitable, higher rankings, extra site visitors, increased engagement, extra conversions, extra income, all for naught if the factor we’re promoting has loopy delivery prices and the delivery prices are turning out to be a loser for the shopper.

This particular person may not pay attention to that, however these folks may. So that you sort of see how understanding a bit of bit extra of what occurs at this stage may also help you set what you are doing right here in higher context. So once I discuss gross revenue, gross revenue is principally income minus value of products bought or COGS typically talking.

That is gross revenue. The factor to keep in mind is that gross revenue pays the hire, not income. You continue to must pay for the price of the factor that your shopper produces, and what’s left over is what truly covers different bills. We do not typically assume that manner once we’re doing search engine marketing tasks, and we’re strictly targeted on income.

Would possibly need to take into consideration gross revenue or asking these sorts of questions, which is a sign. In order that’s the opposite factor about this. We do not have to change into specialists essentially in our shoppers’ companies, however perhaps asking higher questions as soon as we’re within the conferences up speaking about these things with these those who indicators, “Hey, I do know your small business. I perceive that there is extra happening than simply the search engine marketing.”

Subsequent is lowering value. So lowering value will increase worth, and that is the place this is available in. It is a quite simple idea and well-proven that the achieve that one may get from a bit of bit extra of one thing does not really feel nearly as good as shedding a bunch actually stinks.

In order that’s known as loss aversion. So it really works in such a manner that including a bit of bit extra revenue makes the shopper higher off. Dropping revenue can harm quite a bit. It is a idea that is going to be useful and let me form of step you thru it in additional element.

So in case you cut back value and we make suggestions to our shoppers on a regular basis. We do not at all times notice that these shoppers essentially are saving extra money from what we do. It is a helpful factor, however all of our charts over right here must go up and to the suitable. We do not essentially report on how a lot cash I saved you.

We are likely to report on how a lot income I generated. However there are typically conversations and proposals that we will have with the shoppers that could possibly be both new instruments they’ll procure, or perhaps there are issues that we might be doing for a shopper, like content material creation, that we will do at a decrease value than the shopper can do at one other company and even with an inside crew.

So I gave a fast instance right here. So think about you will have a shopper that occurs to be valued at 10 instances their internet revenue to illustrate. If we save that shopper $1,000, that may be, “Oh, nice.” One little factor I threw into an replace on the finish of the month as I am speaking in regards to the income I am producing, however the CFO will instantly acknowledge, “Oh, I am valued at 10x. They only elevated the worth of my enterprise by $10,000.”

That may not be one thing that ever enters into the dialog if we’re simply enthusiastic about the search engine marketing work that we do, however we simply created lots of worth for any person. The opposite one is value avoidance. It is a tough one. However this principally means what are the suggestions we will make for a shopper that may enable them to not spend cash on one thing sooner or later.

Fast instance, a while in the past we had a shopper that was confronted with a alternative. They had been working a m-Dot website and their dot-com for desktop, and so they maintained them each. But it surely got here time to improve their CMS, and so they had two choices. One, they may improve each methods and proceed to take care of a separate cellular and desktop expertise.

But when they did that, they must rent extra builders and one other company to take care of each websites. The opposite possibility was to have a totally fluid website, a dynamic website that allowed them to keep away from all that value. We helped them perceive which may be higher for his or her search engine marketing, however utilizing this framework, additionally which may be higher from an expense standpoint.

They selected to do possibility quantity two. They averted all that further expense, and that was value avoidance. The explanation why that is tough is as a result of it is onerous to show the counterfactual. We do not know what they actually would have spent had they carried out each websites, however we all know what they budgeted and we mentioned, “Hey, by following this different suggestion, you averted having to pay this.”

That is truly finances financial savings. Finances financial savings means, again to our utility curve, that their revenue went up, made them higher off, probably additionally allowed them to extend the worth of their enterprise. Lastly, there’s insurance coverage, and that is one that’s not terribly intuitive till you consider it.

So think about you will have a shopper that’s considering a website relaunch. They’ve an inside search engine marketing crew, and so they’re very assured of their talents, however they may not have lots of expertise or perhaps not as a lot expertise as you in a migration or the location relaunch. So your shopper may have interaction you to have a short-term undertaking to assist increase the capabilities of their inside crew, perhaps examine on issues, perhaps be there the night time of the conversion, and people kinds of issues.

Now it is an extra expense. So this particular person right here may say, “Oh, I do not know if I can get one other company by procurement as a result of we have already got an inside crew serving to us on our migration.” However the CFO may say, “Oh no, that is insurance coverage. I’ll gladly pay an insurance coverage premium to keep away from a large loss if this web site is producing lots of income or gross revenue for me,” as a result of they do this on a regular basis. If you consider all of the insurance coverage {that a} enterprise may spend cash on, explaining that search engine marketing undertaking or that technical search engine marketing help undertaking within the context of insurance coverage may make a ton of sense to them in case you’ve been invited to that desk and you may clarify what you do inside that context.

So right here, I will not get into the small print, however what I’ll present you is that you’ll gladly pay this little little bit of premium, in different phrases, your contract to help their inside crew. The shopper may gladly pay that to keep away from the potential of a big loss. So that you simply must persuade the shopper that your presence will truly stop that loss.

That is insurance coverage and that is worth on your shopper. In order that’s about it. To recap, take into consideration the work that you just do and find out how to translate that into the enterprise challenges that these of us are grappling with. So they could simply pop into your QBR or pop into your month-to-month assembly. They may not perceive Penguin and BERT and ChatGPT or any of that stuff, however they do perceive what is going on to make me extra money, gross revenue, what is going on to save lots of me cash, what is going on to assist me keep away from some nasty prices I’d actually quite not pay, and what is going on to insure me.

How are you going to look at my again and forestall some bigger loss later? So principally again to the place I began, how do you translate your search engine marketing experience into the language of your shopper executives? Thanks very a lot.

Study extra about creating worth for shoppers right here. 

Video transcription by Speechpad.com