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Keyword Price vs. Value: How to Use SEM Data

November 19th, 2010

keyword priceIn a prior post, I calculated the best meta-keywords for blogs in SEO software, e-mail marketing software, and site-SEO practices based on the average price of the top ten keywords in various subject categories that are covered by Considerations (my other blog). Here were the results of my Internet SEO research:

  • Finance — $34.53
  • Business — $32.65
  • Marketing — $28.67
  • Christian — $20.84
  • Dating — $16.43
  • SEO — $16.12
  • TV — $14.50
  • India-Rupee — $14.20
  • Jewish-Israel — $10.38
  • Music — $10.35
  • Soccer — $8.96
  • Economics — $8.53
  • Islam — $6.56
  • Religion — $5.85
  • Culture — $5.84
  • Poltics — $1.79

But that was only half of the story. Price is not the same as value in Google SEO research. Here is why. For the first post, I researched the top keywords in the SEO category (among other subjects) based only on price. This was the result for that specific subject:

keyword seo services 82 2 $24.82
search engine optimization seo companies 52 2 $17.97
affordable seo company 440 2 $17.08
seo mentor 42 1 $16.53
affordable seo report 155 3 $15.02
promotion seo services 66 5 $14.76
seo tactics 125 2 $14.07
seo capabilities 25 3 $13.86
seo security 42 0 $13.69
best seo firm 155 7 $13.36

The columns are keyword, estimated monthly-searches, competition (from a low of zero to a high of ten), and average PPC cost.

When new bloggers want to monetize their websites and then see these prices, they usually become ecstatic: “You mean I cam make up to $24 per click? Wow!” And they optimize their blogs for these keywords.

What Keyword Price Really Means

But they forget to take something into account: The search volume for the most expensive keyword is only 82 searches per month. This is extremely low. Not only will few people find the blog in the first place, the low demand for that keyword also shows that few people will click on the Google ad as a result.

The best practice for SEO meta keywords is to focus on the keyword value, not the keyword price. In economics, the definition of “value” is a hazy concept, but there is a basic way to calculate it for SEO purposes. For example, I could multiply the search volume by the price to find the total value. Now, here are the top ten SEO keywords based on value, not price:

seo software 15000 8 3.35 50250
seo training 4400 7 4.83 21252
google seo 5400 3 3.07 16578
seo elite 6600 7 1.93 12738
affordable seo company 440 2 17.08 7515.2
cheap seo 1000 7 5.89 5890
seo jobs 1800 6 2.82 5076
best seo company 660 5 7.12 4699.2
guaranteed seo 820 5 5.43 4452.6
seo rates 660 4 6.01 3966.6

The columns are keyword, monthly searches, competition, price, and calculated value.

When bloggers — and website owners in general — decide which keywords to target, they need to take at least two factors into account: the search volume (fourth column from the right) and the cost-per-click (CPC) revenue (second column from the right). The “value” number is first on the right — but remember, it is not a monetary value but rather a number that is useful only as a comparison to other keywords. (The third column from the right is the competition — more on that later.)

The best keywords are those that will bring in a high quantity of search traffic along with a high level of revenue per click. Whatever a blog’s subject category, these are generally the keywords that the author should target in SEO.

Now, my research based on price revealed the most-expensive categories — listed at the top of the post — in which bloggers can write. But here are the most-valuable categories for blog topics based on the mentioned calculation using the average of the values of the top ten keywords in each category. You’ll notice a few interesting changes:

Business 121,030
Marketing 99,908
Finance 70,554
TV 27,356
SEO 13,242
Christian 10,469
India-Rupee 9,258
Dating 7,812
Music 6,428
Religion 5,421
Economics 3,202
Jewish-Israel 2,870
Islam 2,737
Soccer 2,673
Journalism 2,668
Culture 499
Politics 435

When bloggers decide on which topic to write and which topical keywords to target, they need to focus on value rather than price.

But the story does not stop there. My basic calculation gives equal weight to both search volume and the price-per-click. Depending on a person’s knowledge of online marketing, he might want to calculate the value by weighing one over the other by certain percentages:

  • (Search volume x 0.70) + (PPC x 0.30)
  • (Search volume x 0.25) + (PPC x 0.75)

Bloggers may also want to take the level of competition into account. Most data gives each keyword a score between zero and ten. Zero means there are few websites competing for search-engine placement (so the chance of ranking highly in search-engine results for the keyword is high); ten means, well, “Good luck!”

If bloggers want to focus on less-competitive keywords at the beginning to rank highly from start, they may multiply the prior value by the inverse of the competition rating:

  • Competition of one: value x 1
  • Competition of five: value x 1/5
  • Competition of ten: value x 1/10

Or, after calculating the value of your list of keywords, online publishers may want to sort the data by the competitive rankings in a spreadsheet and just delete all keywords with a competition value of higher than X. Conversely, dedicated bloggers who want to increase the value of their sites in the long term may want to keep highly-competitive keywords if they believe they will be able to match the competition in the coming months (or longer).

The way to determine the value of a keyword has always been both an art and a science. To paraphrase one of my favorite movies: online marketing is hard — anyone who says otherwise is selling something (that is usually overrated and expensive). The best way to be successful is to test your efforts continuously — in selecting keywords as well as in other SEO practices.

Samuel J. Scott, a former journalist in Boston turned Internet marketer in Israel, is the founder and publisher of My SEO Software and Director of Digital Marketing and Communications and SEO Team Leader at The Cline Group. You can follow him at Google+, LinkedIn, Facebook, and Twitter. His views here and elsewhere do not necessarily reflect those of his company and clients.

Finance $34.53
Busi­ness $32.65
Mar­ket­ing $28.67
Chris­t­ian $20.84
Dat­ing $16.43
SEO $16.12
TV $14.50
India-Rupee $14.20
Jewish-Israel $10.38
Music $10.35
Soc­cer $8.96
Eco­nom­ics $8.53
Islam $6.56
Reli­gion $5.85
Cul­ture $5.84
Pol­i­tics $1.7