Why Companies Are Investing in SEO During the Economic Downturn

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Posted by randfish

There’s no two ways about it - SEO is hot again. In the last 6 weeks, SEOmoz has received a higher than normal volume of requests for consulting. Alongside that, we’ve been getting calls from venture capital firms out of the blue - seven to date - asking either about investments they’re considering in the SEO sphere (and requesting insight) or literally asking whether SEOmoz would like to take more capital to grow (post about that coming soon). And it’s not just us. The jobs and contracts section of the Marketplace has been humming in November, and anecdotal conversations with other SEO firms tell me there’s quite a bit of business to be had for both in-house and external SEOs. Online sales, according to Paypal, were up 34% this year over last - another sign that web commerce is a safe haven for those in need of ROI.

Why? What makes SEO more attractive in a down market? While I can’t say for certain, I’ll ennumerate the most common explanations and motivations I’ve heard and perceived:

1. The Web Outperforms Other Sales Channel
   When organizations look at the paths leading to sales and income (a critical analysis whenever budgets are under scrutiny), the web almost always comes out with one of two assessments. Either, it’s a leading sales channel (especially from an ROI perspective) or it’s deemed to be an area with the greatest opportunity for growth. In both scenarios, web marketing and, in correlation, SEO, takes center stage.
2. It’s the Right Time to Re-Tool
   Established companies frequently use down cycles as a chance to focus attention inward and analyze themselves. Consequently, there’s a spike in website redesigns and SEO along with it.
3. Paid Search Drives Interest in SEO
   Paid search spending is still reaching all-time highs, and when companies evaluate the cost and value, there’s a nagging little voice saying “70%+ of the clicks don’t even happen in the ads; use SEO.”
4. SEO is Losing its Stigma
   Google is releasing SEO guides, Microsoft and Yahoo! both have in-house SEO departments and the “SEO is BS” crowd have lost a little of their swagger and a lot of their arguments. No surprise - solid evidence trumps wishful thinking, especially when times are tough.
5. Marketing Departments are in a Brainstorming Cycle
   A high percentage of companies are asking the big questions - “how do we get new customers?” and “what avenues still offer opportunity?” Whenever that happens, SEO is bound to show up near the top of the “to be investigated” pile.
6. Search Traffic Will Be Relatively Unscathed by the Market
   Sales might drop, conversion rates might falter a bit but raw search traffic isn’t going anywhere. A recession doesn’t mean that people stop searching the web, and with broadband adoption rates, Internet penetration and searches per users consistently rising, search is no fad - it’s here for the long haul.
7. Web Budgets are Being Re-Assesed
   We’ve all seen the news about display advertising falling considerably - that can only happen when managers meet to discuss how to address budget concerns. Get 10 Internet marketing managers into rooms with their teams and at least 4 or 5 are bound to discuss SEO and how they can grab that “free” traffic. 
8. Someone Finally Looked at the Web Analytics
   It’s sad, but true. When a downturn arrives or panic sets in, someone, maybe the first someone in a long time, checks the web analytics to see where revenue is still coming in. Not surprisingly, search engine referrals with their exceptional targeting and intent-matching are ranking high on the list.

I’d love to hear your experiences - have you seen an uptick in buzz about SEO? Has your agency, consulting practice or company taken a renewed interest in the subject? Why?

p.s. For a dose of delicious irony, check out this list of the Top 100 blogs for software development managers. Notice how there are no SEO or SEO-related blogs? And yet, they’re using SEO metrics alongside the list! I’d complain, but then again, as long as web developers aren’t paying attention to or learning SEO, consultants, agencies and in-house SEOs will always have a job.

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