## How to Determine the Value of Blogging

This is a great post by Jay Baer, where he explains how a business might evaluate the overall expense and return on blogging. While the return is logically based on conversion of blog visitors to customers, I think the more interesting part is how he determines the cost of blogging. This summary includes the amount of time, the value of employee’s time, the publishing of content, and the overall maintenance and hosting of the blog itself. Interesting food for thought!

Blogging Expense Calculation

A. How many staff hours does it take per month to write, edit, track, manage the blog?

Let’s assume it’s 36 per month (3 posts per week at an average of 3 hours per post).

B. What do those hours cost the company in salary?

Let’s assume Susan spends 10 hours per month managing the blog, and her salary is \$50,000. Paul spends 8 hours per month writing blog posts at a salary of \$75,000. Shashi also spends 8 hours at a salary of \$95,000. Warren spends 5 hours at a salary of \$150,000. Olivier spends 5 hours at a salary of \$40,000.

Divide each salary by 2000 (hours worked per year based on a 40-hour work week and two week’s vacation) to get average hourly salary compensation. In our example, it’s \$25, \$37.50, \$47.50, \$75, and \$20, respectively. Multiply the hourly compensation by the number of hours devoted to determine the monthly salary expense (10 X \$25 + 8 X \$37.50 + 8 X \$47.50 + 5 X \$75 + 5 X \$20 = \$1405)

C. What do those hours cost the company in overhead and benefits?

Take your monthly salary costs figure (\$1405) and multiply it by your company’s standard overhead calculation. This includes benefits, rent on a per-person basis, etc. Your accountant or CFO will know this number if you do not, and it’s typically 40% – 50%. We’ll use 45%, so the overhead and benefits cost of the blog labor is \$632 (\$1405 X 45%).

The total labor cost for your blog per month is \$2037 (\$1405 + \$632).

D. What does the blog cost in design and technology fees?

If you built the blog internally, use the method above to calculate the labor/benefits cost of the blog’s creation. Or, if you had a third party create the blog, find out how much you paid. Divide either internal or external costs (or a combination) by 24 to find a monthly expense. (This is a two year amortization schedule for blog creation. Given that blogging continues to evolve and redesigns are common, I’m not comfortable stretching beyond 24 months).

Let’s assume that you had a Web development firm create your blog for \$7,500. You did a slight update three months later for \$1,000, making your total costs \$8,500, and your amortized monthly cost \$354 (\$8,500 divided by 24).

E. What does the blog cost in hosting, maintenance, and app fees?

Let’s assume your monthly blog hosting is \$19, and you spend \$19 per month on Inbound Writer to help with you blog’s SEO, and you spend \$19 per month on Formstack to create and manage landing pages to convince people to download your white paper. (both Inbound Writer and Formstack are awesome, by the way)

Your hosting, maintenance, and app fees are thus \$57 per month.

Your total blogging cost per month is (\$1405 + \$632 + \$354 + \$57 = \$2,448)