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In the midst of a great article on measuring ROI in search engine optimization campaigns, Michael Martinez started talking about depreciating link values. That’s an odd way to talk about link building, isn’t it? But it’s really not – not if you consider inbound links an asset.

A Website’s intrinsic value should include the intrinsic value of the links that point to it. So I feel, anyway. Hence, if you can assign a dollar value to links you can improve your asset valuation of a Website. Furthermore, if you incorporate link decay models into your depreciation methodology you can measure a type of growth in asset value that can be used to infer future conversions over virtually any period of time.

All of that’s well and good when determining the value of a website, but what about in determining the value of a link building campaign?

In order for links to depreciate, they have to appreciate. The value of a link is not necessarily what you pay for it – and I’m not talking about buying links. No matter what kind of link building you do, you have to expend some money to do it. So how do you determine link value?

4 Ways To Determine Link Value

One way to determine inbound link value is the traffic generation method. If you can assign a value to each unique visitor and to each real visitor to your website, then you can value your inbound links by the amount of traffic generation they deliver.

The downside to this method is that it doesn’t take into consideration your search engine rankings.

Another way to determine inbound link value is to measure your search engine rankings, but that doesn’t take into consider your website traffic or conversions. It’s not a very good way to judge value because there are a lot of other factors you can’t control.

You can measure link values solely on how well they convert traffic to sales, but there are weaknesses to that model as well. Not all conversions take place the first time a link is clicked, or the first time a visitor arrives at your site. A visitor could click a link and visit your website, then visit it again through a SERP, and finally convert through a PPC ad. So what is the value of that link then?

The fourth way to measure link values is by using a combination of the above methods. The downside to doing this is that you run the risk of counting certain link qualities more than once. Still, by making an honest effort, you can close the loopholes on each method and you stand a better chance of seeing a realistic picture of your link values.

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