What Does "Advertiser Competition" Really Tell Me?

I'd like to get the answer to that questions as well.

Well, think of it on a basic level. It means, in whatever medium you checked, (google I take it), you have a lot of competition in the form of competing websites, adwords, keyword battles, etc.

Entering into the market on those fronts might be hard, depending on how skilled your competition is.

There are always other ways to monetize though. Rather than compete directly with them, find ways to leech on their traffic, or share traffic. Instead of head to head PPC battles, you could try banner exchanges if appropriate, co-reg list building, straight up joint ventures.

Sometimes it's better to finesse your way in, and sometimes its better to bully your way in, but you'll never know for certain if you don't try.

It means that there are plenty of people willing to spend money advertising in this market and that the traffic in this niche has value...Which means there's money to be made.

In a perfect world, you want:
High advertiser competition
High number of search queries for ALL keywords in the niche
Low number of competing web sites.

High and low are relative terms. Compare the stats of the three criteria above for multiple niches and pick the niche with the best numbers.

It's not useless at all. I look at the advertiser competition to see if there is money in the niche or not and if yes, how much money. While all data are just estimates, it's still a valuable part of my keyword and niche research.

I would never start making a site in a niche that has low advertiser competition and very low CPC (below $.25). It simply tells me that nobody is spending money in that niche and therefore nobody is making any money there. How would you be able to make money in such a niche?

It's important to look at the numbers of all keywords, not just one. So if most of the keywords have a decent CPC and competition you have found a good niche to make some money. If just one or very few keywords have it, something is fishy with that niche I usually back away.

Gunter

I don't know how exactly Google measure the advertisers' competition but I guess if it's high there's some serious money being spent. That's all you really need. Afterward it's just finding a way to get some of the pie.

I haven't use this tool but I tend to look very crudely at the number of Google Ads being displayed for a keyword when looking at a niche. If there is say between 5 and 30 I would consider it worthwhile investigating further. Any less and there's probably not a lot of cash there - any more and I'm probably gonna have to pay more to advertise than I want. Hope this helps.

I'm always saying this:

The amount of Ads running, or even the types of products being sold is NOT always an indication of YOUR potential.

There's several reasons for this.

1. Other advertisers might have a long term and profitable backend of offers (which is very likely in many cases, THAT is the secret to winning with PPC bid prices)

2. The other advertisers are either total bozos or big dumb asse companies with far too much money to play with, meaning you can either work smart and win, or get completely shadowed by what I call "blind bidders" with fat wallets and thick heads.

3. Conversely with Google, you can enter into any market and steal a portion of the lion's share, simply by being SMART with your ad copy, product matching and backend sales. That's why I love the quality score principle so much...level playing field.

Ultimately, it's correct to say that if there is high advertiser volume then there is a damn good chance that lots of money is being spent (that's almost taken as read), but here's my advice:

Sport teams/clubs would face competition no matter what league they are in, the difference is whether you can beat it and "promote yourself" to the bigger leagues.

if u want to earn then u have to compete, thats simple

The first thing to do is to consider the source. It sounds like you are using Google's External Keyword Tool. This is aimed at people thinking of using Adwords to promote a page or site.

The advertiser competition shown in the tool is a relative measure of how many Adwords advertisers there are and/or the bid price required to hit the top spot.

Expand the results to show you the estimated cpc to get into the top three spots, and you'll see how much G estimates you'll have to pay to hit the top spot. One thing - the estimates do not account for things like quality score or CTR, so they tend to be a bit high.

At best, the advertiser competition bar can help you compare different key phrases.

If you're using the tool to find keywords for articles, blog posts and the like, you're better off looking at other factors to judge the strength of the competition. I tend to look at the results of the first 1-3 pages when running a "phrase match" search (keyword in quotes).

This is getting long enough already, so I'll just say this. If you want to learn more about evaluating the strength of competition, there are some excellent reports available for free in the War Room. Or try a few searches here in the main forum and in the SEO section.

Try different things and see what works for you...