Keyword Spy and Other SEM BI Tools

Spy Tools
Tools like Keyword Spy, SEM Rush, and Spyfu have a lot of useful information when it comes to understanding the ways that some people show up for ads and organic rankings.

You can find out great things like who your competitors could be and how they segment and target their keywords.  This alone is a value to any company that wants to know what is up with the competition.

However, there are some things about any of these services that are flat our incorrect. I was in a meeting recently and someone was talking about ad spend on one of these “spy” tools and this person even acknowledges that this is a baseline of data, not entirely accurate. Kind of a baseline more than anything else.

I can live with that, but if you have been dealing with the same competitors for a decade,  you develop an instinctive gut check that can be trusted about who is spending more.

I have used keyword spy for a while now, but also use SEM Rush and Spyfu in the past. They all work under the same principal when it comes to PPC. In this particular instance I suspected that we spend more money on a segment of the business than others, but the actual “baseline” in these tools contradict my gut check.

I am comfortable enough with my gut check to challenge that baseline, so I started down a path of figuring out why my assumption is wrong. I would rather start off defeating my own thought with data before going down rabbit holes.

So here is what I did:

  • Go to one of these tools, look for your own domain info and look at what they say you daily ad budget is.
  • Copy that daily ad budget and multiply it by 30 (this is what the tool says your monthly spend is)
  • Go to adwords and choose the last 30 days (if you have a huge up and down on spend, get a longer time frame and determine a consistent 30 day average)
  • Figure out what the observed percentage difference between the  tools number and the actual.
  • Once you get that difference add it to the baseline in the tool. (it should be the same as your adwords account now.
  • That baseline percentage difference  (in most cases) applies to all of your competitor’s accounts. You can get a better feel for their spend (not 100% accurate, but closer than what these tools say)

So after I ran the number that way, I felt even more so that my gut was closer than the tool, so I need to validate my data. So I hopped on live chat, asked the rep at one of these tool vendors why the number was so far off from reality and how its derived. The rep explained that with these tools they and most companies will eliminate multiple keywords from campaigns and ad groups and treat them as a single keyword.

What this means is that if you have potted plant, potted planters and potted soil enhancer they will likely remove two keywords and use just one. I get that, but depending on how campaigns are set up, this can eliminate hundred, thousands, or even more keywords from the daily ad budget and provide a misrepresentative number.

This is AWESOME news for some people because after you do the math, the formula may not apply to everyone the same way. As such the result will be wrong data all together.

The end result of this is that PPC research tools are good for research, but trying to use them as a source of accuracy and planning needs to be considered strongly before actually using any of the data,

Even the keyword lists these tools provide are very broad search query reports  and drags in everything that served up an ad on a domain, so it does not mean that you or the competition actively bid on these keywords.

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