Pete Lock
Performance Marketing

How SEO, website and digital marketing due diligence identifies growth opportunities for private equity firms & investors

What is SEO, digital marketing & website due diligence?

Digital due diligence covers many different areas, from SEO to digital security and compliance right through to the online performance of the company’s digital marketing strategy….Its website, social media presence, online advertising, email marketing, sales and leads funnels, amongst others.

This digital footprint is the focus of our diligence work. It’s an area that we specialise in covering an in-depth due diligence SEO audit, alongside detailed website and digital marketing audits. Marketing tactics can sound subjective, so our digital tools, testing procedures and advanced reporting add a numerical value to previously untested and costly activity.

With an increasing number of deals exceeding 10x EV/EBITDA (over 60% last year for the private equity industry in the US according to Pitchbook) it’s vital for a PE firm to utilise all potential levers of growth. Online sales and marketing optimisation, especially in mid-market deals, are often underutilised and offer significant opportunities going forward.

The value of a sound digital strategy is increasing with the growth in the online presence of most companies, indeed Bain sees this clearly “For diligence into a particular company, web scraping provides indicators of market share and growth momentum, such as web-traffic analysis”.

Further to this, savvy PE firms are starting to wake up to the potential alongside more traditional marketing efforts and directly apply it to their portfolio companies. According to Jim Howland, a Managing Director and Operating General Partner at Morgan Stanley Capital Partners “Increasingly our value creation plans focus on working to accelerate top-line growth by adopting a more sophisticated marketing strategy and making material investments in the function.”

The results of the due diligence audit services that we conduct identify opportunities for growth and highlight areas of friction that require fixing. Being armed with this powerful knowledge and implementing it on portfolio companies has led to significant online performance improvements for our clients.

The Correlation Between Digital Adoption & Performance

A recent report by Mckinsey highlighted the strong negative correlation that nondigital company cultures have on economic performance. It’s worth noting that along with an aversion to risk and restrictive mindsets, a lack of digital culture is an accurate indicator of suboptimal company performance. Rather than viewing these situations as being negative. Our approach targets the opportunities that are available once the diligence process has been conducted and lays out a clear strategic marketing plan to move forward.

Integrating creativity and data drives more growth

Connecting and integrating creativity and data management for marketing appears to be the golden ticket for driving growth. Mckinsey carried out a major recent study where they surveyed over 200 CMO’s and senior marketing executives. Their aim was to measure the integration of creativity and data in marketing.

Their results demonstrated that what they refer to as “integrators” – those that unite data and creativity – grow their revenue at twice the average rate of companies in the S&P 500.

See the results below:
(Source: Mckinsey)

What are the benefits of SEO, digital marketing and website due diligence?

1) Discover How Your Target Company and Its Competitors Are Really Performing Online

Data snapshots and general traffic reports only go so far. To drill down into the data that often contains the hidden gems of your online performance requires deeper analysis.

Being able to attach points of reference to your data, with both industry best practices and your competitors’ performance levels, allows you to see exactly where your company sits. From there high-impact recommendations are produced to target the gaps and opportunities which arise. These recommendations are concise, achievable and fully tracked so that you can see the changes in performance once the changes begin.

2) See Exactly Why Your Competitors are Winning …and Losing

In highly competitive markets, it can be tough to keep up with what your competition is doing and how they are performing. We include your company’s major competitors in our digital due diligence work. Even though we are taking an outside view of them, there is still a great deal of data available that we can present back to you. This easily shows you exactly how your competitors are performing in various critical areas.

3) Deep Data Analysis That Yields Growth Opportunities

Companies are often overwhelmed by the sheer amount of digital marketing data they have available to them. Knowing the exact metrics that can have a significant impact allows us to measure the data that really matters to your company. Rather than a one size fits all approach, we analyse each company individually based on its business model and sector. The due diligence is carried out by our experts using proprietary analysis tools specifically built for this purpose which then create fully bespoke reports.

Some of the areas we analyse:

  • Website design & conversion performance
  • Sales & lead funnel performance
  • Search engine performance (SEO due diligence)
  • Paid search & display advertising campaign performance
  • Social media presence & engagement performance
  • Email marketing & CRM performance

4) High Impact Recommendations

Instead of wading through endless streams of data and recommendations or having bloated reports that sit gathering dust. We present you with a set of high-impact recommendations, based on the due diligence analysis that can be executed over 90  days or less to give optimum results.

5) Impartiality

Conducting due diligence externally ensures that all the intelligence that is gathered is impartial. This impartiality is critical because anyone connected, even loosely, to a company will have created their own set of opinions. These can be counterproductive as they are probably not based on the kind of agnostic detailed data analysis that we employ.

Being impartial allows us to deliver pure insights, untainted by internal opinions.

What levels of digital marketing & website due diligence reporting do we offer?

  1. Quick View DD – For investors and private equity firms assessing potential portfolio investments, we provide you with a one-page overview of a target company’s digital presence and marketing performance. This gives an insight into critical marketing metrics and how the company performs in these areas against its main competitors. The report is designed for a swift turnaround and to easily fit within an investment report for quick reference, whilst also offering high-quality analysis in a concise format.
  2. Pre Deal DD
    A more in-depth external view of a target company and its competitors. Key insights into brand representation, search engines, social media and online advertising performance, sales funnel effectiveness and competitor comparisons. The report includes high impact recommendations for future growth and a 1-hour consultancy call to discuss the results.
  3. Full Due Diligence Report – When a prospective investment is going ahead, has actually occurred or a higher level of due diligence is required. We conduct a more extensive and detailed analysis which includes competitor comparisons and the target audience. From this, we create a set of high-impact recommendations that are likely to have the highest ROI impact and are generally achievable within a 90-day window. We discuss and explain these to you so that they are fully understood, and if required we can assist with the implementation of the actions.

Use digital sales and marketing to transform your target company. Book a free consultation now to discuss how we can help you:

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