The Saturday Coffee Talk question this week comes from Karl in Dallas. Karl asks what are long-tail keywords and how can contractors use them in their marketing online. So Karl, this is going to be hard, but I am going to try to talk about long-tail keyword use in less than 500 words. So here we go.
In studies on long-tail keyword use, research has found that long-tail searches have a higher conversion compared to the more generic (and shorter) keywords. This means that long-tail keywords can be extremely profitable for contractors through a lower cost per action coupled with a higher return on investment.
The Long Tail was popularized by Chris Anderson in an October 2004 Wired magazine article, in which he mentioned Amazon.com and Netflix as examples of businesses applying this strategy. Anderson elaborated the concept in his book The Long Tail: Why the Future of Business Is Selling Less of More.
The distribution and inventory costs of businesses successfully applying this strategy allow them to realize significant profit out of selling small volumes of hard-to-find items to many customers instead of only selling large volumes of a reduced number of popular items. The total sales of this large number of “non-hit items” is called the Long Tail.
Given a large enough availability of choice, a large population of customers, and negligible stocking and distribution costs, the selection and buying pattern of the population results in a power law distribution curve, or Pareto distribution. This suggests that a market with a high freedom of choice will create a certain degree of inequality by favoring the upper 20% of the items (“hits” or “head”) against the other 80% (“non-hits” or “long tail”). This is known as the Pareto principle or 80–20 rule.
The long tail in keyword research is basically an expansion of a core, generic, high volume keyword phrase to include numerous combinations and permutations of the keywords and their associated or relevant phrases. These phrases individually are unlikely to account for a great deal of searches, but when taken as a whole, can provide significant targeted traffic that convert well.
In other words, most people search for the keyword “plumber” to get info, but search for “24 hour emergency plumber in Miami Florida” when they are ready to buy. The nice part about using long-tail keywords in a PPC campaign is that you can generally pay much less on a per click basis for long-tail keywords than you would for shorter, more generic keywords, but get a better conversion ratio.
Using the Google Keyword Tool, let’s take a look at some common searches:
Keyword Cost per Click & Monthly Searches
Plumber has 450,000 searches and costs $3.91 a click
Emergency Plumber has 14,800 searches and costs $5.30 a click
Plumber Miami has 1,900 searches and costs $4.92 a click
24 Hour emergency plumber in Miami Florida shows unknown searches but costs $.05 a click
Notice all the keywords have significant traffic (at a significant cost) except the “24 hour emergency plumber in Miami Florida” keyword. Trouble is, you also don’t know the search volume for that keyword either. But here’s the catch.
How contractors win using long-tail keywords
Don’t worry about how much traffic a keyword generates because you only pay when someone clicks on your ad! And since your cost is only going to be a nickel, then you might as well bid on it since the next closest keyword is 78 times more expensive than your long-tail keyword. Build yourself a solid list of quality long-tail keywords and you can generate enough cheap traffic every month to be a very happy plumber.
One word of caution
Don’t set up a campaign based solely on long-tail keywords. The reason is Google is evaluating you as a marketer just as much as you are evaluating them as a marketing platform. If your conversion ratios aren’t high enough, your overall quality score for the campaign can suffer as well as the quality score for your entire Adwords account, so be careful! And by the way, I missed 500 words by about 146!