Who believes SpyFu's CPC and Ad Budget Estimates?
SpyFu.com is a pretty nice tool to check who competes with whom on paid search with what keywords. It also tries to guess CPC and daily ad budget for a domain or keyword.
Here are the two articles trying to make sense of SpyFu's magic:
My guess is that SpyFu probably uses Google AdWords Traffic Estimator to get CPC, daily click volume, ad position estimates and do some estimation on daily ad budget.
But remember that your actual CPC and ad positions are based on not only how much you bid but also your quality scores related to your keywords, ads, and landing pages. Thus, I don't really think SpyFu can provide good estimates by generalizing the estimates just based on the keywords a domain has impressions on.
One crazy hypothesis is that SpyFu.com bids on keywords it tracks to get a sense of the pricing landscape. But this is not scalable and cost-prohibited when people click on their ads.
The CPC and daily ad budget estimate feature sound so good for marketing, but it's probably too good to be true to be used in your competitive analysis and your rationales for budgeting your SEM campaigns.
Tags: adwords ppc sem spyfu cpc quality_score competitive_analysis
