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Measuring the Potential Earnings of a Keyword and Choosing Which to Target

Updated on October 22, 2011

If you have been reading some of my other tutorials and explanatory guides on search engine optimization and keyword targeting, then you probably already know why the keyword research you do prior to preparing any article or content is one of the most important aspects in determining the level of success of that particular webpage or hub. The following tutorial will provide you with a simple formula that you can apply to keywords you find via Google's Adwords Keyword tool, allowing you to compare and contrast the earning potential of different words and phrases.

This quick equation will help you to decide which keywords to target and allow you to reasonably estimate your income for any given target, but these results can also be compared to the performance of pages that you already have, giving you an idea of whether or not the given webpage or hub is doing a good job.

  1. The first thing you will want to do is check how many times a keyword or phrase is searched in a month, as well as the CPC or cost per click for the given keyword. Refer to the additional resources below for information on using the Free Adwords Keyword tool to do this.
  2. You can choose to use the amount of times a given term is searched globally or locally - this choice should be based on the topic your webpage focuses on. You can expect about 40 to 50 percent of these searchers to visit your webpage if you were the first result for the given keyword or phrase, so multiply the total monthly searches by .4 or .5 to determine the amount of views you can get for a keyword. Let's label this value Y or 'keyword potential'.
  3. Even though additional traffic is great, only a small portion of these viewers will actually click an ad to generate you any sort of profit. Expect about 3 to 6 percent of your viewers to click an Adsense ad, possibly slightly higher if you are using direct affiliate marketing through Amazon or Ebay or focus on certain "buy" or "action" keywords in your writings. Multiply your 'keyword potential' value by .045 for a general idea of how many clicks you will receive, or adjust the value based upon the topics or monetization of your webpages. We will call this value X or 'click potential'.
  4. Now that you know how many people will visit your page once you are the top result and the amount of viewers that will click an advertisement, now you have to find out how much these clicks will net you in profit. Take the CPC or cost per click amount of the keyword you are researching and multiply it by .25 or .30. We will refer to this as Z or 'click value'. Take your click value and multiply it by your previously discovered click potential. This final result is the amount of income that you will earn for a keyword per month as the top result in Google. This will be signified by $ or 'keyword value'.

Quick Recap:

Take the amount of times a keyword or phrase is searched in a month and multiply it by .4 to determine keyword potential (Y).

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Multiply keyword potential (Y) by .045 to determine click potential (X).

-

Multiply CPC (cost per click) by .25 or .30 to determine click value (Z).

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Multiply click potential (X) by click value (Z) to determine keyword value ($)

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Monthly Searches x .4 = Y --- Y x .045 = X --- CPC x .25 = Z --- (X) x Z = $

Keep in mind that this projection only represents the amount of profit you would be able to earn as the top result for a keyword, and does not factor in the competition you will face. Continue reading for information on determining the competition or difficulty of a keyword.

Determining Keyword Difficulty

Understanding how much a keyword will profit you as the #1 result is good, but you also have to be able to determine how difficult it will be to reach that level. You will need the SEO for Firefox plugin or another tool that allows you to check pagerank and linking base will be required. A great domain referred to me by a fellow Hubber (JAnderson99 - see comments) will prepare a list of the top ten results for any given search term as well as each sites Pagerank, page authority, domain authority and domain age. You will also be able to see if your website is listed in DMOZ or Yahoo, and the listings will also tell you exactly where the domains use the exact keyword (in the title, in the web address, in the description and as an H1 tag). All of this information is provided by OpenSiteExplorer, but you can find this handy tool at the following address: http://www.webtistic.co.uk/keyword-competition-tool/

Manual Competition Research: Input the keyword you are planning to target into a Google search. Go through the results on the first page and check the page rank and linking base of every website. You will also want to look at the content contained within the webpage, checking for it's relevancy, length and value. You will usually want to avoid competing with a domain that is any higher than pagerank 3 if you don't plan to do a great deal of link building or if you don't already have a high ranking domain of your own, but exceptions can be made if the result fails to mention the keyword in the title of the page or within the actual web address itself. You might want to use these methods in addition to using Webtistic's tool (mentioned above), as this will give you a better idea as to what you are going up against.

So what does all this information mean?

The free tool provided by Webtistic above will give an overall difficulty rating for your keyword or phrase, and this number can be used to give you a good idea of how difficult or simple it will be to rank for any given key term. You should keep in mind that a search results page dominated by high ranking websites that fail to directly address the keyword sufficiently can be surpassed by a page of much lower page rank, so it is important to view the website for yourself or at least make note of the areas that the keyword appears via Webtistic's tool.

Some individuals unknowingly use the 'competition' level in Google's Adwords keyword tool as a means of determining the difficulty of a keyword, but this value is designed for webmasters who are interested in purchasing pay per click advertisement space under a given keyword and is not relevant to SEO.

Determining the difficulty of a keyword or phrase is the most important aspect of keyword research, and should probably be done prior to estimating the potential profits. If you have decided on an article topic, simply document all of the ways someone might search for this as well as it's cousin keywords via the Adwords tool and make note of these. Check the difficulty of the keywords you are considering as well as their potential profits; both of these amounts can be compared to determine if the lessened difficulty of a keyword will be worth the lessened profit potential or vice versa.

Until you've targeted a couple keywords and actually seen the amount of work required by you in order to appear as one of the first results, it will be somewhat difficult to realistically determine which keywords will be most beneficial to you in terms of money earned and time spent. By continuously experimenting and working towards creating a better or more profitable webpage with these ideals in mind, you will begin to notice that much less effort is required on your part and the process of keyword research will begin to feel more natural.

Don't forget to follow me and check out some of my other articles focused on teaching hubbers, bloggers and webmasters how to increase traffic without pay per click advertising.

Comments

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    • homesteadbound profile image

      Cindy Murdoch 

      7 years ago from Texas

      So looking forward to learning!

    • PaulPd0 profile imageAUTHOR

      PaulPd0 

      7 years ago from Los Angeles, California

      Glad to see that you've been reading some of the hubs Homestead!! I'm working on some fresh tutorials now and should have a couple more up in the next day or so. I think you are going to be surprised when you realize all the things that you can *still* teach yourself :)

    • homesteadbound profile image

      Cindy Murdoch 

      7 years ago from Texas

      I am bookmarking this one for future use. Thanks for sharing this information. I am slowly starting to pick up the terms and even starting to know what people are talking about sometimes. Amazing!

    • PaulPd0 profile imageAUTHOR

      PaulPd0 

      7 years ago from Los Angeles, California

      Great Tool - saves quite a bit of time. I have always used OSE explorer myself but this makes it a bit easier on the user. I'll definitely mention this in the article - thanks!

    • janderson99 profile image

      Dr. John Anderson 

      7 years ago from Australia on Planet Water

      Consider this

      http://www.webtistic.co.uk/keyword-competition-too...

      I have no association with them but its is a fab free tool.

      cheers

    • PaulPd0 profile imageAUTHOR

      PaulPd0 

      7 years ago from Los Angeles, California

      I apologize J. The article is actually unfinished but I published it as is anyways - just signed back on to finish it right now.

    • janderson99 profile image

      Dr. John Anderson 

      7 years ago from Australia on Planet Water

      I think you have underdone the competition aspect. This is the key aspect - If you can't compete there is no point - your potential for the keyword won't be realised. You provide very little advice about this or how to estimate it. There are better ways of doing this.

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