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Profiting from Terrible Keyword Supply and Demand Ratios

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      Article Title: Profiting from Terrible Keyword Supply and Demand Ratios
      Article Author: Brian Kindsvater
      Article Copyright: 2004

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      Profiting from Terrible Keyword Supply and Demand Ratios
      Copyright � 2004 Brian Kindsvater
      Nichex
      http://nichex.com



      One of the recent fads is to search for keywords and niches based
      on an R/S Ratio. The 'R' is the number of websites found with
      that keyword as reported by a search engine search (the supply),
      and the 'S' is the number of searches on that keyword (the
      demand).


      Here is How This Works

      In fantasy land the number of searches would be 100,000 and the
      number of websites would be 1 (your website), resulting in an R/S
      ratio of .00001.

      In reality, the number of found websites is about 1,000,000 and
      the number of searches is 10,000, resulting in an R/S ratio of
      100.

      Theoretically, the lower the ratio the better, which is why
      numerous marketers suggest that low R/S ratios be searched for
      and then targeted. Keywords with high R/S ratios are immediately
      discarded.


      Why the R/S Ratio is Meaningless

      Theoretically, the ratio works, but now let us get back to the
      real world. If you are ignoring keywords or niches with high
      ratios you are missing highly profitable markets.

      The number of websites reported as the 'supply' is usually
      meaningless. This is why the ratio does not work if it is based
      on the number of computer generated results. So Google says it
      found 10,000,000 other websites with your keyword. Hope is not
      lost. You are not competing against 10 million websites. Hardly
      any of the websites will have anything to do with your target
      market.


      Compare the following:

      Example 1

      Search results - 100,000
      Searches - 10,000
      R/S Ratio - 10

      Example 2

      Search results - 5,000,000
      Searches - 100,000
      R/S Ratio - 50


      Which example is potentially more profitable?

      You have no way of knowing! If you automatically fail to
      consider Example 2 in your marketing efforts because it has a
      much higher ratio you may have made the wrong decision and
      discarded 100,000 potential customers.

      You need to actually review the websites listed in the search
      results to see what value they hold. This is important. The
      'supply' side of the equation that needs to be evaluated is not
      the number of websites containing your keyword, but the number of
      websites that are actual competitors.

      If the top websites are giving away your information for free,
      like government sites, then maybe it is time to find a different
      keyword to target.

      But more likely you will see only a few, or maybe a few dozen
      websites that actually provide meaningful content or products
      that compete against you. Instead of a theoretical 5,000,000
      websites, in reality there may only be 50 - or less.

      The R/S ratio analysis is also primarily only important for
      natural search engine results. Through pay-per-click programs
      you can jump your website to the top of the search engine results
      page, and your competition for PPC keywords will be even less.
      Sometimes it will be nonexistent.

      You also need to remember that a high R/S ratio in Google may not
      be high in Yahoo, 7Search, or another search engine. Similarly,
      keywords for which bidding competition is fierce on Google may be
      wide-open in Overture.

      As a result, do not be quick to disregard an entire keyword
      market due to your initial evaluation that the keyword has a
      terrible supply and demand ratio. Dig a little. Review the
      actual search engine results and act as a potential customer to
      better assess what the real competition is. Compare different
      search engines, and evaluate different PPC programs. This extra
      effort will often unveil profitable markets that your
      competitors, using a flawed analysis, will neglect.



      Resource Box:
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      Brian Kindsvater has been marketing online since 1994. Brian
      shares research about niche products, free and useful marketing
      resources, and valuable articles at the exclusive membership site
      http://nichex.com Brian Kindsvater's legal articles can be
      found at http://lawzilla.com
      -----------

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      Profiting from Terrible Keyword Supply and Demand Ratios
      � 2004 by Brian Kindsvater
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      Posted: Thu Aug 26 02:02:00 EDT 2004


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