What is the best way to measure ROI with SEO?

use this equations A*b/C = % or use this tool http://tools.seobook.com/general/keyword-density/

It depends on : 1-Your current Cost Per Conversion, Cost Per Click, Cost Per Visit, etc.? 2-Your goals/needs for traffic.
You can't just say "Well, I want as much traffic as possible." Of course you do.
Who doesn't? You have to say "My goal for 2011 is a X% increase in organic traffic." 3-Your time frame.
Only have two weeks to get your goal? SEM might be the better way to spend your marketing bucks.

Dear Reem, Thanks for inviting me to answer, If im going to answer in a single Phrase, it would be "DATA COLLECTION " If I'm a good successful investor I'll know or answer the following: - SEO Investment Lifetime: SEO is a long and continuous process, so I'll construct my plans to track Return on SEO investment for 6-12 months (If I'm going to be strict, I'll say there is a need to build a model to track ROI continuously, since anything we do in SEO affect the business almost for the whole business life cycle).
- What would be my evaluation currency?! Almost all will go with the traditional/direct method of evaluating $ to $ return, while if im doing it, I'll measure the return using other measures such as (for example): A- Back-links count and quality.
B- Indexed Pages.
C- Returning Visitors/New Visitors ratios.
D- Average time spent on pages.
E- Search Results CTR.
F- Many other factors.
I'll create weights, establish a formula or a model, converting an improvement in any of the above mentioned points into a monetary value.
this will help tracking the ROI in a dynamic and continuous way.
- To what level I'll track sales, how much accurate I'm? I'm on the same track with Mr.Tarek here, you need to go into details to answer some important questions such as: A- what is my exact cost per lead/sale? B- What is my average customer life time? C- What keywords, Campaigns, Links bring me more sales? how much, and where from.
D- What is my conversion rate? is it accurately measurable? E- Can I distinguish between sales came from my SEO efforts and those generated from other sources - Social Media/Word of mouth for example? F- Can I distinguish offline sales from online sales generated by offline marketing? G- Can we distinguish branded and non-branded sales!? the bottom line is, the best way to measure your ROI for SEO is to look at SEO as continuous, complicated process, a part of your overall marketing plan and to act as a CIA Technical Agent who loves to track every single record possible!

Hello there, In order to measure ROI with SEO There is always a missing link between Call Center - Web Leads from the internet and Web Analytics.
The Secret is : A dedicated Phone number and a dedicated landing page and Good BI Solution such as Salesforce CRM ( the CRM must integrate with the Website to be able to Track Sales and Pipeline) Some Analytics are good and free such as Google Analytics , some other as very advanced such as Omniture SiteCatalyst having 1st Party Cookie , yet it need strong implementation and good reports generation ( handling Big Data) Please ask me more questions so we can narrow down and tailor your answer.
Tarek Hassan, GM of Hubac Media

Hello, for me the best way to meassure the ROI with SEO is the ranking of the selected terms on a dedicated browser (mostly Google) and the time that it will take you and the money spend to arrive to the top position.
Regards, Samir.

If the keywords you chose are targeted then it will provide best ROI after getting Rank in Search Engine.
The ROI depends on the Requirement and target Goals.
For Example your target can be only visitors in some cases or your target can be to sell products online and to generate leads.
You can easily track your ROI after setting up the Goals in Google or any other analytics platform.

Hi Reem, To measure Returns on Investments, you need to first understand and rationalize the terms Returns and Investments both.
Your investments will define your returns and if invested wisely, you can increase your returns significantly.
However, I'll focus on two great results that is expected from every SEO campaign i.e.
Rankings and Traffic.
For Rankings: If you are measuring higher rankings as your Return you need to measure the competition against the keywords you want to rank for.
The wise selection of your targeted keywords and the competition against those keywords will give you an idea of how much time and resources are needed to beat your competition.
This will directly define your investments required for the task.
So let's say, you are a company who develop mobile apps.
You want to rank for "iphone development" keyword.
When studying the competition you find out there are a lot of companies/websites targeting this keyword and they have big budgets to spend on SEO and SEM.
You may not want to target this keyword as yet provided you are not willing to spend much budget on it yet.
However, researching more, you find out that "iphone app development dubai" is a better keyword in terms of targeted approach and competition both.
You may want to start with this keyword initially and rank high.
In short, you bench mark your milestones.
Select two sets of keywords to target.

1- Long tail keywors are easier to rank so make sure you try to achieve them within months.

2- Short tail keywords are general keywords and you can keep targetting them if you want to but make sure you plan to achieve those in a year or two.
The time is dependent on the competition.
And when you are achieving your milestones, you can say you are getting better returns on your investment provided you invest enough to beat your competition.
If you are not achieving rankings, you may want to revisit the strategy and change the focus of keywords.
For Traffic: If you are aiming to achieve a set number of visitors a month, you will need a different strategy.
Rankings are good if they are against targeted keywords.
If you achieve rankings for keywords that are not relevant, you may be number one on Google but you'll not get any traffic.
So for traffic, you want to target the platforms where you audience exists.
This includes Google, Bing, Social Media platforms, blogs and forums.
Now, you are not after rankings but after traffic.
And not every visitor comes from search engines although search engines are a major source of traffic to any website.
In this scenario, you need to set milestones to achieve rankings against your targeted relevant keywords shortlisted after competitive research and milestones to work on getting traffic.
And to achieve more traffic you need to study the behavior of your audience, the working of your competitors and hit and trial practices of your own.
Better results can provide you hint about better ROI.
Hope this helps and makes sense.
Feel free to ask if you need more help.
--- Thanks, Usman Latif Founder, Internet Marketing Pakistan™

Its depend upon the customer, client or company what they are looking for.
Mostly people are looking for Top Ranking for increasing the exposure of the website over the search engine.
sometime people look for traffic for that perspective you need to do Social media to get immediate traffic in order to see the boost in the number of visitor per day or per week.
SEO is a Slow and time taken process in order to ranked higher your website over the search engine such as google.
bing and yahoo etc.
Your precise and concrete answer is : First Page Ranking, Increasing the Targeted Traffic, checking the difference before SEO and After SEO.
So that you make some decision either its effected your website or not? if you have any question do let me know feel free to add me on skype: shahzore.ali I will be waiting for your response.
Hope my answer will thoroughly satisfied you for what you are looking for.
Thanks best regards shahzore ali

Visit This On line calculator to calculate your Return Of Investment Through SEO http://www.seoroicalculator.com/

I support the line used by Alaa AlHamdan it's all about the data, ROI is a broader term.
SEO is an effective way to get more number of hits & page visits.
i remember the classic debate between ATL & BTL marketing activities.
SEO is ATL activity but with the calculation of BTL activities.

Look at how much you’re investing and what you are getting in return.
You can do so by comparing the investment of one month with your profit 6 months in prior.
.
Keep in mind it is an ongoing marketing effort, so it might take longer to see results.