[dc]Y[/dc]ou need to know how to research keywords for SEO and for PPC. Google gives you free tool to investigate keywords before starting PPC campaign or when you want to write new Blog Post.
So, I will explain how to Research Keywords with Google Keyword Tool, and some important points of the tool’s Columns:
- Avg. Monthly Searches
- Suggested Bid
Keyword Monthly Searches
First we want to find new keywords.
In the Keyword Tool I will make a search, for example: “Unique Value Proposition” (from my previous post).
You need to switch to Keyword Ideas to look for your Search Term. The first Tab is for Ad Group ideas.
You can see Average Monthly Search for “Unique Value Propositions” if you go through the small graph icon. A big graph will pop up.
For this keyword Avg. Monthly Search is 1900 according to Google Statistics.
Competition and Suggested Bid
The next 2 columns are Competition and Suggested Bid.
For this keyword the Competition is Low and the Suggested Bid is 0.25$. I will explain what this means, just read further.
In the table below Google shows suggested relevant keywords that are similar to your search.
This table is paginated and you can sort by Competition or Suggested Bid.
The trick is that Competition Column has only 3 broad values:
From this 3 values you can’t make good decisions, but there is workaround to get real values for this column.
Look at the picture below. You can export all keywords into CSV and open it into Excel or other spreadsheet software.
In this file, the values for Competition are in decimal format.
The range for the competition field is from 0 to 1. And it may be for example 0.01, 0.9, 0.2, 0.05 etc.
For the UVP keyword there are 25 results, so I searched for “Unique Selling Proposition” with 75 keyword results and merge both CSV files.
After that I sorted the results by Competition column and you can see that it starts from 0 for some keywords and in the end goes to near 1:
Google keyword tool competition column
Let’s do the math…
Competition near 0 (Low) and high bid:
When the competition is low for example 0.05, it means that there aren’t many advertisers bidding for this keyword.
Then why is the Suggested Bid $2.20? The reason for high bid for this keyword is that, even if there is only one advertiser to bid for this keyword, his bid is above 2$.
So, if there are 1000 impression or searches for this keyword, if there is one advertiser with bid 2$, his ad will be shown to all impression. If someone clicks on the ad, the advertiser will be charged 2$.
If someone else wants to bid for the same keyword and if his bid is 2$, then 500 impression will gain the first advertiser, and 500 impression the second. If someone clicks on an ad, they both will be charged 2$.
So, the competition is low, only 2 advertisers. They both get a lot of impressions, but the bid is high and they are charged 2$ for each click.
Let see this situation:
If the second advertiser, because of low competition, sets bid, for example 0.5$, his ad will get 200 impression: 1000 impressions/5 = 200 impressions, and the first advertiser will get 800 impression.
(1 advertiser) 0.5$ + (2 advertiser) 2$ = 2.5$ = 5 parts
When someone clicks on an ad form the first advertiser, because his bid is 2$, he will be charged 2$. But, when someone click on an ad from the second advertiser, he will be charged 0.5$.
What is the conclusion from this math?
You will get fewer impressions, but you will be charged lower.
If the competition is high (near 1), you need to bid around the Suggestion Bid, because you won’t get impressions, if you set lower bid.
About example Keyword: “exit strategy”
For the keyword exit strategy, the competition is 0.05 this is near 0, so you can bid lower than the Suggested Bid, under 2$. You can try with 0.5$ and share your results.
Feel free to write your comments on this and share your experience with your keyword research and the low and high bidding.