How does the seo vs paid breakeven work?
Borrowed from Finance: Compounding asset vs decaying spend
Financial analysts compare an asset that pays over time with a rental that stops when payments stop. Content is the asset, and paid media is the rental.
Traffic ramps up linearly to a steady level over the ramp period. Value is the number of visits times the paid cost per visit.
Worked example
A US company spends $5,000 a month for 6 months to build content, then $1,500 a month. Traffic ramps over 12 months to 6,000 visits a month, valued at $2.00 a visit. Breakeven arrives in month 8, and net value after 24 months is about $165,000.
How should I read my result?
Strong case for content. Fund it and protect the budget.
Reasonable. Use paid media to cover the gap.
Traffic is too low or costs too high. Pick less competitive topics.
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Questions about seo vs paid breakeven
Is paid cost per visit the right value?
It is a conservative proxy. Conversion value per visit may differ for organic traffic.
Does content traffic decay?
Yes, without refreshes. Include maintenance cost to cover it.
How do I estimate steady visits?
Use search volume of target terms and an expected click share.