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How To Estimate The Value Of A Keyword

Discussion in 'Black Hat SEO' started by LBrown, Nov 18, 2011.

  1. LBrown

    LBrown Senior Member

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    The value of a keyword will always vary greatly and there are way too many factors to come up with a 100% accurate formula. Still, I wanted to share a formula that I learned as newb on how to estimate how much you can earn with any keyword via Adsense. (Some of you might recognize this.) Keep in mind that this only for estimation purposes to see if a keyword will be worth your while.

    (Exact Monthly Searches * 0.4 * 0.05) * (CPC * 0.68) = Keyword's Monthly Earning

    So if you are looking at a keyword with 5000 exact searches and a $1 CPC, you could expect to make:

    (5000*0.4*0.05)*(1*0.68)=$68/month

    For many people, they get to #1 in Google and wonder why they are not making enough money to quit their job and buy a new house. It is either because there is not enough traffic or because that traffic is not very profitable or both.

    This formula makes a few assumptions:

    1) It assumes that the keyword tool you used to do research is giving accurate data about traffic and CPC.

    2) It assumes that when you reach #1 in Google that 40% of all searchers will click on your site. This is the 0.4 in the equation.

    3) It assumes that 5% of those who click on your site will click on your ads giving you a 5% CTR. This is the 0.05 in the equation.

    4) It assumes that Google will give you 68% of the click payment since Google says that this is what they will do. That is the 0.68 in the equation.

    There is a lot of room for variance in all of these assumptions which is why it should be used for estimation purposes only but I found it very useful when I was starting out and I thought others might as well.
     
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  2. MakeLemonade

    MakeLemonade Junior Member

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    Another great share.

    (I usually HATE it when people make comments like this, but this thread needs to be bumped. It's that good.)
     
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  3. Kennen

    Kennen BANNED BANNED

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    Definitely a great share. Clarified quite a bit of information for me. Thanks for taking the time to write it up.
     
  4. kcon1

    kcon1 Registered Member

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    How did I work out the CPC for a keyword?
     
  5. balsagoth007

    balsagoth007 BANNED BANNED

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    What you say is exact. Thanks
     
  6. allurre

    allurre Junior Member

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    That's a pretty neat equation you've got there.

    Of course, if you want to make substantially more money online, always diversify your blueprint. There's more to just adsense cash :)
     
  7. the_demon

    the_demon Jr. Executive VIP

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    This is a tool my company built a while back. Enjoy. :)

    Code:
    http://verdadmedia.com/tools/roi-calculator.php
    There are 2 algorithm versions. I suggest you run both models to get the best idea. Algorithm 2 is based on the latest CTR data.
     
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  8. LBrown

    LBrown Senior Member

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    That's pretty nifty. I ran the numbers for several of the keywords I'm at #1 for and the actual earnings are usually right between the two estimates so it provides a great estimated range.
     
  9. trustedfire9

    trustedfire9 Jr. VIP Jr. VIP Premium Member

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    (Exact Monthly Searches * 0.4 * 0.05) * (CPC * 0.68) = Keyword's Monthly Earning

    let's test that , adsense sites my next project .

    @ op do you think this formula works with non english keywords too ?
     
  10. LBrown

    LBrown Senior Member

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    For non-English sites you'll want to look at the local search results, not the global search results. I look at local most of the time anyway and consider anything additional a bonus.

    edit: I'm not sure what I said is true about having to use local. But yes, the formula will still give you a decent estimate.
     
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    Last edited: Nov 29, 2011
  11. davids355

    davids355 Jr. VIP Jr. VIP Premium Member

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    Wicked thanks:)