Names and products have been changed to protect the innovative – at least until the patent application has been submitted ;-).
I was chatting with a friend based in California (who I’ll call ‘Jim’) just the other day about an idea for a product that he had been working on for a few months. Let’s call the product the ‘Organic Battery’. So anyways, Jim had spent a bit of time and effort trying to develop this product and was at the point that he was thinking about getting ready to sell it, but he wasn’t sure what the market was like for this product, or whether it was worth any more time and effort. The plan would be to market and sell it online. In this day and age it is probably the quickest way to market.
So while chatting to him via Skype we did some simple yet essential bit of market research which took us about 5 minutes. (I know you marketing specialists out there are going to have a lot to say but I must make it clear that this is just a quick market/reach indicator). So how did I do this you ask? With a really simple and free to use tool called Keyword Planner which is found inside Google Adwords.
So why this tool?
- Firstly, because it taps into the search statistics of the largest search engine in existence → Google.
- Secondly, because its completely FREE to use.
- Lastly, we could go and ask large battery manufactures for their sales and market stats but I think they would not be very happy to hand over all that info to a potential competitor.
So what does it do?
Very simply, the Keyword Planner helps you understand the search characteristics of the online market. In this day and age, as online shopping grows exponentially so do people searching for stuff to buy. And their first stop is a search engine such as Google. Google allows you to understand what people are searching for and how many of them are searching. Keep in mind that a lot of the data that they hold is keyword (search phrase) centric.
So back to our product, the Organic Battery. In order to do our research we need to know two things.
- Where do we want to sell our organic battery. For now let’s say we want to market and sell to consumers in the United States.
- What keywords are people using to find the battery. At this point I’m guessing they use the words ‘battery’ or ‘organic battery’ as search phrases. One nice feature of the tool is that it gives you keyword ideas so you don’t need to know all the search phrases. I’ll let the tool help us.
Now for the research. The first thing is to figure out which keywords to research. As I mentioned above, the obvious ones are ‘battery’ or ‘organic battery’ but not everyone who wants to buy a battery online is going to use these two terms. So to figure out which keywords we want to analyse we will use the first option ‘Search for new keyword and ad group ideas’.
The result below shows me that there are over a million searches every month in the US for search terms related to ‘battery’.
So what are we seeing here? Before I answer that, let me put add a little perspective to the Keyword Planner and Adwords. Google Adwords is an advertising platform that advertisers use to generate those adverts you see all over the web, the ads you see in Google search results or websites that are generating revenue using Google Adsense. This Keyword Planner lives inside Adwords and is meant to help an advertiser understand the market so that they can create better adverts and and use targeted keywords to trigger those adverts.
So back to the results. What Google has done is it has automatically grouped closely related keywords that you can use to trigger a related advert. e.g. the first Ad Group called ‘Battery’ has 328 related keywords in it. The combined searches for all keywords in that ad group is 441040 per month. Competition is high meaning that there are quite a few others advertising those specific keywords. ‘Suggested bid’ is the amount that Google recommends that you offer per click on your advert so that you have an increased chance of getting more clicks. Don’t worry too much about the rest.
Switching over to the ‘Keyword Ideas’ tab reveals a few other search terms related to what you are searching for. We can see that if we simply focused on the keyword ‘battery’ we may have thought that our chances are low and the market is small with only 60500 monthly searches. But there are 693 related keywords that we didn’t consider that are potentially relevant.
So what have we learned here. A few things really.
- The search volume is good. Over a million searches in the US for keywords related to the term battery.
- We have also identified the other related search phrases, which can be very valuable. I didn’t think of rechargeable batteries, or battery plus, or many of the other related keywords to be honest. So let’s select a few that we think may be relevant. ‘battery’, ‘battery plus’, ‘rechargeable batteries’, ‘duracell’. We will use these for now.
Another bit of market research, especially when you are trying to sell a product and are new on the market is related to advertising. We would like to get an idea of how many people would visit our website if we were to advertise with these keywords. To do this we go back to the Keyword Tool landing page and select ‘Get traffic estimates for list of keywords’.
I’ve entered the 4 keywords that I chose above just as a representation. Often you will choose a few, sometimes dozens, sometimes hundreds of relevant keywords (if appropriate) to use as the keywords for your advert. Select ‘United States’ and then click ‘Get Estimates’.
On the next page, I entered the CPC (Cost per Click) of £0.20 in the ‘Bid’ field. This is the maximum amount that I am willing to pay per click depending on how much others competing for the same keywords are willing to pay → Simply put it is the maximum cost per visitor that Google will charge for each visitor it sends to my website via an advert targeting these keywords. I’ve specified a budget of £20 as an example. Google then provides me with an estimate of how many visitors I may get.
In the results below we can see that based on our bid and budget, we could get about 260-ish customers every day, just from Google alone.
After we get that potential customer, it is out of the hands of our paid advertising strategy and up to the quality of the website, product and pricing for us to convert that user into a paying customer. I’ll save that for another post.
You can probably do this in less than five minutes and it is relevant whether you have a product, service, blog or any other website base venture for which you want to understand related online search trends. As you get more proficient at searching, believe it or not, you can spend a lot more time using this tool as there is a lot more to it and you can fine tune to your hearts content. I suggest you explore a bit.
I use this all the time for the sites and projects I work on that I wish to monetise. It is free to use and you don’t have to be actually advertising to use it. So if you have an idea, go ahead and try it out. The results may surprise you.
Anyways, Jim felt a bit more confident in moving forward with his business and we have decided to make it a joint venture. So stay tuned. I’ll keep you updated and let you know when that product and business goes live.
So you see, 5 minutes of market research can make a world of a difference.
Take it for a test drive and let me know what you think.