About the BrightLocal Local SEO Industry Survey
The objective of this survey is to gain better understanding about the current state of the local SEO Industry. With this survey we hope to find out about life ‘on the ground’ for those in the local SEO industry, and also to share the research & findings publicly to help improve the knowledge and insight within our industry.
BrightLocal Local SEO Industry Survey 2014
This is the 3rd wave of the survey and was conducted in July / August 2014.
1,759 SEOs completed this year’s survey (up from 1,409 in 2013) and we thank them all for giving us their time & information to make this survey possible.
The survey asks questions specific to Local SEO and was promoted to the BrightLocal user base and our network of SEOs & agencies. We also received support from SearchEngineLand.com in promoting the survey so big thanks to the team there!
The majority of survey respondents are SEO freelancers, small digital agencies and web designers so the results are indicative of this audience.
We opted to update and change some of the questions asked this edition. There are 19 questions which cover 5 key areas:
Size & Turnover
Clients & Industries
Marketing & Sales
Services & Tasks
Future Outlook
We have made the following charts available for download as a PDF so that you can use them as a presentation in your reports. Download it here: Local SEO Industry Survey 2014.
Previous Surveys:
1st wave – July 2011 – http://www.brightlocal.com/local-seo-industry-survey-2011
2nd wave – January 2013 - http://www.brightlocal.com/2013/05/03/brightlocal-local-seo-industry-survey-2013/
Size & Turnover
1. Which of these descriptions best describes you/your company?
This question sets the scene in helping us to understand our who our respondents are.
There is a healthy mix of respondents from different set-ups but the majority of those taking part are either local / regional agencies or freelance SEOs.
2. How many people in your company are ‘SEOs’?
Key Findings:
84% of those surveyed have 5 or less SEOs in their company
Analysis:
As we saw in the first question, the majority of respondents are local / regional agencies or freelance SEOs, so it’s unsurprising that 84% have just 1-5 SEOs in their business. We’ve compared the results to the responses from last years survey & can see that the results are very similar.
This shows that the majority of those working in local search do so as sole-traders or part of smaller agencies working within their immediate towns & counties. We see in later charts that income levels remain low for many in the industry, so the opportunity or practicalities for growth remain difficult for many of us. Obviously a % of SEOs choose to remain small & nimble and are not looking to grow into larger agencies.
3.What was your turnover in the last 12 months?
Key Findings:
37% of respondents turnover was less than $30,000 (vs 33% in 2013)
50% had a turnover of less than $50,000 (vs 43% in 2013)
10% had a turnover of more than $500,000 (vs 17% in 2013)
Analysis:
There is a spread of turnover levels from <$30k to $500k+ with agencies/consultants working at all levels.
One of the most dramatic figures is the rise in the percentage earning less than $30,000. This is up to 37% (vs. 33% in 2013) which itself was higher that 2011 figures. This is an alarming trend for the industry which should command higher fees & income given the complexity of the work & the potential impact it can have for a local business when done well.
Obviously the majority of our respondents are local / regional agencies or freelance SEOs and so you would expect the turnover to be lower for smaller operations. Even so there is notably less of our respondents with a turnover of more than $100,000 than there was in both 2011 & 2013.
Does this suggest that the industry has grown more competitive, forcing local SEOs to lower their prices in order to compete & win clients? Alternatively, are SEO’s pricing their services too low? (more on this below)
Is it sustainable for a company to operate with a turnover of less than $30,000 in an increasingly competitive market?
Please note – P/T SEOs & ‘newbie’ SEOs would skew this figure as they are not operating at full capacity.
Clients & Industries
4. How many clients do you personally handle?
Key Findings:
33% handle 1-5 clients personally (vs 28% in 2013)
41% handle more than 10 clients personally (vs 41% in 2013)
24% handle more than 21 clients personally (vs 24% in 2013)
The average local SEO deals with 9 clients (vs 11 in 2013)
Analysis:
Respondents are handling slightly less clients than last year, with the biggest shift moving from those handling 6-10 clients, to now handling 2-5 clients.
However, with 24% handling more than 21 clients, it adds up to an sizeable work load & tasks required each month. The key to running a successful local search business is efficiency and the ability to develop tools, processes & templates which can be followed for each client.
Hopefully tools like ours help to save time & take burden off hard working SEOs. While you can’t – and shouldn’t – automate all SEO tasks, we would advocate making use of available tools which allow you to focus on winning & working with clients, and tackling more critical SEO tasks.
5. Do you serve a particular vertical industry or do your clients come from many different industries?
Key Findings:
60% serve lots of different industries (vs 67% in 2013)
23% serve 2-3 vertical industries (vs 20% in 2013)
17% serve 1 vertical industry (vs 14% in 2013)
Analysis:
There appears to be an increase in the number of SEOs targeting their efforts on clients in specific sets industries.
With staunch competition in the local search service market it certainly helps to have a specialism that allows a consultant/agency to demonstrate deeper understanding of a specific client’s business, industry & their own customers. Using the correct terminology & jargon related to an industry is more likely to resonate with a business owner and make them keen to work with you.
This specialism helps to -
understand client’s needs better
standout from other, less-focused agencies
convert more customers
charge higher fees
6. What does an average customer pay you each month?
Key Findings:
40% charge under $500/month
68% charge under $1,000 per month
32% charge over $1,000 per month
Arithmetic mean charge is $1,020/month (vs $1,085 in 2013)
Analysis:
We can see that the income per customer varies quite a lot. Interestingly there are more clients paying less than $100 per month than there are clients paying more than $5,000 per month, and those paying over $5,000/month have dropped from 7% to just 3% since 2013.
So the average that customers spend appears to have dropped by $65 year on year (a 6% fall). Again this is a worrying sign for the industry as could mean a devaluing of the service by customers or fierce price competitiveness driving down what we charge.
Of course the type, depth and level of services provided will dictate the price point, as well as the size of the client company. Smaller SMBs will obviously have less marketing spend than a multi-location franchise business.
Marketing & Sales
7. Which channels are most effective for attracting new customers to your/your company? (select top 3)
Key Findings:
28% say word of mouth is the most effective channel for attracting new customers
17% say SEO is most effective
11% say local business groups are most effective
Analysis:
It’s clear that a local SEO’s best tool for attracting new customers is it’s reputation. Whilst there are many channels available to attract new customers, 3 out of the top 4 are based on offline reputation & relationships.
SEO is also a big driver for local search consultants/agencies – that’s lucky! It helps to be able to demonstrate that if they can successfully get their own businesses ranking, then they stand a better chance of doing the same for their customers. SEO is also considered far more effective than PPC for generating leads.
The channels which have increased in perceived effectiveness year on year include SEO, Facebook & Local ‘meet-ups’ / workshops. However, social channels such as Facebook (6%), LinkedIn (5%) & Twitter (2%) are generally considered less effective as sales channels, but as we’ve seen before, these are probably more effective for communicating to existing customers rather than converting new ones.
8. How many new leads do you proactively contact each month? (via outbound emails & calls)
Key Findings:
27% do not contact any new leads each month (vs 32% in 2014)
27% contact 2-5 leads per month
75% are contacting less than 10 new leads per month
12% contact more than 50 new leads per month
Analysis:
In 2011 the amount of SEOs not approaching new leads was 46%. This fell to 32% in 2013 and now 27% in 2014.
Coupled to that we can see that 12% of respondents said they made over 50 sales calls/emails – up from just 5% in 2011.
This tells us that local SEOs are having to make more effort to win new business on a regular basis..
With most SEOs juggling multiple clients, (24% handle more than 21 clients personally) you would assume that they have their hands full, but this tells us that many are hungry for more business.
With the data we have it would be interesting to cross-examine some of the findings we’ve presented here. In a follow-up to this report, we’ll produce further insights into how company turnover relates to outbound lead generation, as well as how company turnover corresponds to the number of clients that a typical SEO looks after. This will allow us to draw further conclusions on the above.
9. What is your success rate at converting leads to customers?
Key Findings:
20% have a less than 10% success rate (vs 17% in 2013)
58% have a less than 50% success rate (vs 57% in 2013)
Only 15% have a success rate of 80% or more (vs 14% in 2013)
Analysis:
With increased competition, winning new business becomes harder. Although there is not much of a difference year on year, there is a notable difference since 2011.
Hats off to the 1% that manage to convert 100% of their leads into customers! In 2011, 21% said they had a 100% hit rate but this has dwindled to just 1.
Once again, in follow-up to this report, we’ll look closely at how the number of outbound leads pursued by a company, compares to the average industry success rate.
Services & Tasks
10. What SEO/online marketing services do you offer? (select as many as you want)
Key Findings:
Google+ optimization, on-site SEO & citation building are the most popular services offered
11. Which service is most in demand from your customers? (select as many as you want)
Key Findings:
Video & mobile marketing are amongst the services offered least & with little demand
Services seeing most increase in demand are: Google+ optimization, citation building & website marketing
Analysis:
The services which are offered by local SEOs generally match those services which are most in demand.
In most cases, and from what we have seen in our experience with talking to BrightLocal customers, the services offered by SEOs are driven by customer demand. Video & mobile marketing are both channels which are well discussed in the industry now, but perhaps SMBs are not as educated about their benefits – which opens up an educational opportunity for all you SEOs out there!
12. How much of your work do you outsource to 3rd parties & white-label SEOs?
Key Findings:
53% outsource less than 10% of their workload to 3rd parties (vs 62% in 2013)
13% outsource more than 50% of their workload (vs 9% in 2013)
26% outsource more than 25% of their work (vs 17% in 2013)
Analysis:
There is a slight increase in the amount of work that is outsourced to 3rd parties.
As SEOs take on more & more clients, this is an efficient way to handle the increased workload at reasonable & controllable cost. Many outsource services specialise in certain areas – e.g. link building – so can also be a very effective, as well as cost effective, option.
13. Do you believe that Social Media is an effective marketing channel for local businesses?
Key Findings:
88% believe that social media can have a positive effect on a local business (vs 82% in 2013)
12% are undecided or not convinced
Analysis:
In 2011, 76% were positive about social media for local businesses, in 2013 this increased to 82%. This year that has climbed to 88%.
There are more SEOs who believe that social media is a very powerful tool, and less who thought it worked for some businesses, which means that there is a general shift in feeling that it is becoming an essential channel for all local businesses, rather than a select few.
14. Which of the following SEO & Business tasks do you tackle in a typical week?
Key Findings:
Onsite optimization, Reporting / analytics, SEO audits & client management are the most tackled tasks per week
New business development can often be neglected in favour of existing client tasks
Analysis:
We can see the full array of a wide range of tasks undertaken by SEOs on a weekly basis. It’s becoming an increasingly complicated industry & those that are able to simplify tasks will surely prevail more often than those that become bogged down by reports & meetings.
We can see that there are tasks which could become potentially streamlined, and that reporting, however important can get in the way of the actual SEO work that is required.
Self-promotion tasks such a self marketing & new business are low down the list. With these tasks being critical to establishing a reputation & winning new customers we can start to see why so many consultants/agencies are struggling to grow and earn more than $30,000 p.a.
15. Which of the following SEO & Business tasks do you find to be the most time-consuming and tedious?
Key Findings:
Link building, content writing & citation generation are considered the most time-consuming & tedious tasks
Analysis:
Interestingly, Google+ optimization & is considered one of the most in demand tasks – and also one of the most popular offered – and it is also a far less tedious & time consuming task than many of the others. That’s good news and the recent launch of Google MyBusiness coupled with ongoing improvements in verification & customer support are lowering the pain barriers of working with Google+ Local/MGB/Places (whatever you want to call it!!)
Link building was considered the most tedious task by 41% of SEOs in 2013, and 34% this year, perhaps suggesting that some SEOs have stopped doing / changed strategies in the wake of Google penalties?
16. Which of the following SEO & Business tasks do you wish you could do more of? (select up to 3)
Key Findings:
New business development is the number one task that SEOs wish they could do more of
Link building, self marketing, on-site optimization & SEO audit / analysis are other popular choices
Analysis:
Link building is seen as a tedious task yet one that SEOs still wish they could do more of.
New business development goes hand in hand with growth & staff recruitment (more on this below) throughout the next 12 months so not surprising to see it high on the wishlist again. Unfortunately given the sheer work load undertaken by SEOs there isn’t much time left over for winning new business – it’s the catch 22 for growing from a 1 man consultancy into a larger agency!
It’s also interesting to see the amount of tasks that were so high on an SEOs wish list / agenda last year, but have since dropped in 2014. These include analytics, citation generation & social media optimization.
(Please note that some tasks are new additions to the 2014 survey).
Future Outlook
17. Do you expect to grow your business in next 12 months?
Key Findings:
93% definitely expect to grown their business in the next 12 months
Analysis:
There is a huge amount of optimism in the SEO industry with 93% of respondents expecting to grow their business in the next 12 months. The 2013 survey returned the same figure for the expected growth throughout 2014, but in 2011 the expectancy was a modest 82%.
With such optimism you could be forgiven for thinking it was plain sailing for SEOs in the next couple of years. But we’ve seen in earlier charts that income levels are falling, winning customers is becoming harder and customers are paying less. But it’s great to see that this isn’t dampening enthusiasm and outlook for so many of us.
18. Are you planning to recruit more staff in next 12 months?
Key Findings:
70% have plans to recruit more staff in the next 12 months
14% are unlikely to recruit more staff in the next 12 months
Analysis:
More positive news for the industry with so many agencies looking to recruit.
19. Which of these phrases best describes your hopes & expectations for next 12 months?
Key Findings:
83% believe it is going to be a ‘great’ or ‘good’ year
17% are a little less sure about the outlook
Analysis:
Despite the fact that SEOs are a little more hesitant this time around, with 45% definitely planning to recruit more staff vs 53% last year, there is still a very positive outlook on the horizon.
With such positive outlook and expectancy of growth in the SEO industry, more staff are sure to be required. More clients mean more work, and more work means more hands on deck. With such growth we are likely to see more and more ‘new to SEO’ staff enter the field in the next 12 months. This year, 10% said they were new to SEO, and that figure looks set to increase again in 2015.
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