Great questions – the example you did was correct, I use broad match and divide it by the number of results on the SERP, then I usually format the numbers to show as percentages because I think it is easier to look at with less decimal places. For instance, in your example, the keyword mens wool coat would be 2.4%. This is actually pretty high as many keywords are lower than .25%. If the keyword has a high percentage, that means it is theoretically easier to rank for than those with lower percentages. We create a huge list of keywords and then run the rankability on all of them to see where they compare. For some sites, they will all be fairly low but you can still find some that outshine the rest. Something like mens wool coat may be 2.4% while the plural, mens wool coats, could be 5%. I also usually look at the SERP and see what kind of pages are currently ranking – if Target, Amazon, Kohls, and other major labels are taking up the first page – it probably won’t be easy to outrank them. Being as specific as possible helps but not so specific that you significantly decrease your search volume, as found with the keyword tool.

Lastly, remember, the number isn’t the most important thing. Don’t trade out a term with a low percentage for a term that doesn’t describe the page as well as it should, just because the rankability is higher. Use rankability to decide between strong, accurately themed words, and even to decide if you need to look for more keywords. I once had a client that had terms already picked out – as it turned out, the global monthly search volume was 0, so we decided that we should start from the top.

I hope this answers your questions!

Great post. Had a couple of questions:

When you used the keyword tool are you setting the search to Broad, Phrase or Exact?

I also had a question on keyword competition and your calculation using the Google Keyword tool and Google search queries on the SERP. You said that you use the Google keyword tool to find the number of searches each query receives per month, and divide that number by the number of current Google results cued by that query. Can you give an example of this?

As an example I entered the keyword mens wool coat, broad match and it came up with 6,600 local search volume in the Adwords keyword tool. That phrase in broad match on Google.com came up with 273,000 results. 6,600 divided by 273,000 comes out to 0.0241. Is this calculation correct? Or am I doing it wrong. Also once you get the calculation how do you apply it to seeing if a keyword is too hard to rank for or possible to rank for?

Thanks again for the excellent post.