KEI (Keyword Effectiveness Index)

KEI (Keyword Effectiveness Index) is a proposed standard formula to calculate how competitive and popular a set of keywords in search engines. It was invented by a SEO specialist Sumantra Roy. KEI for a keyword phrase is formulated as ;

KEI = (Number of Monthly Keyword Searches)^2 / (Competing Pages)

Competition
Before explaining why we had the square of searches the formula, we should think ourselves how we basically find the competition and popularity. In SEO world, competition is the number of SERPs (Search Engine Result Pages) for an exact keyword phrase. If I open Google and type the exact phrase using double quotes "iphone games", currently I get 1,400,000 results. It is the number of pages we should beat in competition to be ranked in first page results.
Popularity
We can find the popularity of a keyword phrase using free tools like Google Adwords Keyword tool or paid tools like Wordtracker. I prefer to use Google Adwords Keyword tool. It is quite useful and returns relevant up-to-date results.
According to Keyword Tool, there are approx. 140,000 monthly worldwide searches for "iphone games"
We could simply divide these numbers and compare the result with the results of other keywords, but KEI didn't do like this. There is a logical reason for this.

Explanation of KEI Formula
Suppose that we have another iPhone related keyword with monthly searches of 5 and with 50 competing pages. It means that it will be easy to rank at the first place, but it doesn't worth the efforts since there is no demand !
If we simply divide both numbers for both "iphone games" and "our keyword" we would end up with the same result. 1/10. It is certainly apparent that they don't have the same value.
If we would just look at this simple division result, we could be deceived. Because of this, KEI squares the number of searches as a signal to show its popularity.
Actually, you could just use any other power. For example I can write the formula as Power of 3.

KEI = (Number of Monthly Keyword Searches)^3 / (Competing Pages)
But this time, since I have given more importance to popularity (number of monthly searches) I have to give much more efforts to rank better in SERPs. This number depends on SEO skills. I personally use power of 2 as a proposed standard.
Usage in SEO
Actually, it is a systematic and straightforward approach. For example, if you have determined that lets say, Palm Pre related keywords are getting high KEI, you should begin writing articles using the exact phrase in the title of your article and one, two times inside the article text. Do not forget to add a few tags without spamming as well. Then, you should hunt for dofollow backlinks to increase your position in the eyes of search engines. Submitting the article on social networks with dofollow and finding blogs with dofollow comment mechanisms like Comment Luv is not an hard task, but can be time consuming.

A more complicated KEI Formula
Eventhough KEI is a significant indicator, I have developed another formula adding parameters like PageRank of Competitors, Backlinks to Competing Page and Advertisers Competing for Keywords. Read my advanced KEI formula article and see how I derive it using Google Search, Google Adwords Tool, a Backlink Watch tool and a PageRank Firefox widget.