There are two features of a keyword that together indicate whether a keyword is ripe for the picking.
1st is the # of searches per month (local) that the keyword receives: how many people are actually typing those exact words into Google per month.
2nd is the “CPC” or “Cost Per Click” of the keyword. The CPC is the more difficult piece of the pie to understand. Essentially the CPC is the dollar value that all companies (that are interested in the keyword) have bid the keyword to. If the ROI of a keyword is high, then companies are willing to pay more $ per click for greater profits. Conversely, if a keyword has a lower ROI then companies will only pay less for it because it is less profitable. So if the CPC is undervalued, then companies will see the opportunity for greater profit and bid up the price for the keyword, while if the CPC is overvalued then companies will see that it is not worth that high of a CPC because it is not profitable at that value and the CPC will be bid down by companies until the CPC reaches an equilibrium point.
These two halves form the whole that is “Commercabiliy.” To find a keyword with great commercability means to find a keyword which has a great searches per CPC ratio. Neither piece can be too high or too low. Both must be a moderate value within their particular range.
For example: There are around 1.8 million searches for “seo” every month with a CPC around $11. Many SEO companies will only tell their client about the number of views, which sounds very impressive, but how many of those 1.8 million searches actually turn into sales?
Now let’s take the $11 CPC into consideration. What does that tell us about how companies value that keyword? $11 on its own is just a number, we must look at similar keywords to figure out whether companies are placing a higher or lower value on the keyword: whether the keyword has a high or low ROI.
Looking at similar keywords reveals that $11 is a lower value and that similar phrases value around $20 to as high as $25. This proves to us that the ROI of “seo” is very, very low which means that very few of those 1.8 million searches turn into sales.
Thus optimizing for this keyword would not be worth all the work it would take to be ranking well on Google. A more specific keyword with lower search volume and higher CPC would be a better keyword choice.
However, if we focus on a more specific keyword phrase like “seo company” then naturally we should see a decrease in # of searches and hopefully an increase in the CPC. Sure enough, there are around 165,000 monthly searches and the CPC is $21! The doubling of the CPC shows us that although there is only a tenth the # of searches, there is a far higher ROI for this keyword.
Going one step further, let’s try the phrase “seo marketing companies.” This keyword has even less searches at around 6,600 per month, but the CPC is actually higher at $22. Now since the CPC remained about the same, but the # of searches decrease again by 90%. The ROI for this keyword has skyrocketed past the last phrase. People who search for this keyword are incredibly more likely to become customers compared to the other phrases.
This last keyword would be an ideal choice to optimize for because the search volume is still a healthy 6,600 per month and the CPC tells us that a good number of those 6,600 turn into clients. 6,600 may not sound that impressive, but what if just 0.05% of those become a client? That is still 3-4 clients per month.
Imagine you own a plumbing company and you optimize your website and market your brand so you rank as #1 on Google for the phrase “24 hour plumber.” This keyword gets 9,900 monthly searches with a CPC of $21, noting that the ROI is on the higher end for this field. With a close rate of just 0.05% (not half of 1%, which would be 0.5%, but 0.05%) would mean bringing in nearly 5 NEW clients per month. Times 12 months a year and that’s 60 brand new clients a year generated organically through marketing your brand on Google.
Yes, finding a keyword with great commercability and optimizing for it can be explosive for your business. Don’t be fooled by a digital marketing agency that just tries to sell you the big search number only to have the phone never ring. Make sure they know what a quality keyword is and how they can help you rank well for it.