I love log files, analytics, and looking in your own backyard for PPC keyword strategies. I think your own site's keyword database  is the best and purest (though not the only) place to start your keyword research. Your site's keyword data offers you three things: relevance, accuracy, and relevant accuracy.
- Relevance - You know these keywords are relevant to your business and your site's content, because people have already gotten to your site via these keywords .
- Accuracy - I find that actual traffic data is a much better indicator of actual traffic than playing around with the daily/weekly/monthly estimates from keyword tools.
- Relevant Accuracy - If I go to a keyword research tool  and see that a lot of people are searching for a keyword, that's obviously useful data. But what would be more useful is to know if the people who searched for that keyword would then become a conversion on my site. I can learn this by looking at my own analytics.
And, I don't think there's any debate that keyword data is becoming a proprietary asset for businesses who advertise online. As such, I think it makes a lot of sense to invest in building out a keyword list complete with actual data about how many times people will actually visit your site if you bid X, and about how many times people will convert (and at what price!) if you advertise against a given keyword.
Acquiring This Data Without Breaking Your PPC Budget
A great way to build this keyword database would be through organic search engine optimization. While I balk at the idea that SEO is "free" (try hiring good copywriters, creating the kinds of relationships that build trust, and employing someone competent to ensure that your information architecture and keyword targeting are optimal for "free"), you can at least pay a minimal price for irrelevant clicks in SEO, and you should be targeting various SEO keywords  and tracking their value, anyway.But what if you don't have much SEO data? You or your client has a new or poorly optimized site? Here are a couple of tricks for doing PPC keywords  discovery "on the cheap":
- Embedded Match - This is a "matching option" offered by Google (really it's a mash up of two matching options, but either way...). Basically, it allows you to advertise against variations of a keyword without bidding on the keyword itself.
- Multiple Match Types - I think it's a good idea to employ various matching options for testing purposes. You can also apply this principle to frugal keyword discovery.
Let's take a closer look at how this would work for each option...
Embedding More Keywords Into Your PPC Campaign
I like broad match for keyword discovery, but it certainly presents some efficiency issues if you're trying to provide ROI and hit a target CPA. SO what's the solution?
Bid low on your keyword discovery engines, bid high on the keywords you know perform well.
Let's say I run an online retailer focused on the sale of banjos (hey, someone has to be selling banjos online, right?).Anyway, I know that the term "banjo" is too broad. It has a very high CPC, and aggressively bidding on it with broad match will lose me a bundle. In fact, clicks on "banjo" are simply an overall loser for me. But I still want to find all those great banjo terms I don't yet have on my keyword list (more importantly, I want to know which ones convert).I can just take the term banjo, and set it to “embedded match":-[banjo]banjoThis means that I am advertising against banjo on broad match, but if someone types in "banjo" exactly, my ad won't show:banjo - WON'T showbanjos - MAY showcheap banjos - MAY showbanjos are making a comeback - MAY show (also the statement is just very true)Key point: now I will turn the bid way down on this keyword.This lets me accomplish two things:
- Find New Keywords - I can discover long tail keywords  that people are actually searching for, that I wouldn't have otherwise stumbled upon.
- Find Out How Effective Keywords Are - While a keyword tool might show me "cheap banjos", it can't tell me whether it will convert for me. This system can.
Option Two: Being Broad But Focused
For the second example, let's assume we have a bit of account data already. We know that "cheap used banjo" is a great performer for our used banjo store (I know I was selling all kinds of banjos at the beginning of the article, but the banjo vertical is pretty cut-throat, so I had to focus on something a bit more niche).Now, I have some conflicting interests:
- I want to bid aggressively on cheap used banjo. It's a great performer and a key part of my campaign.
- I also want to discover new, effective keywords surrounding this one.
- I don't want to pay for garbage; I have run the keyword on broad match, and bidding on all those extra terms killed my CPA from this keyword.
The solution is to bid aggressively on the more restrictive matching types (phrase and exact) and to bid considerably lower on broad match:cheap used banjos ** 0.50"cheap used banjos" ** 4.00[cheap used banjos] ** 6.00The way it's been explained to me by my AdWords rep, is that if I run these three options, broad matches will be assigned to the broad keyword, exact matches to the exact keyword, and phrase matches to that matching option:online banjo store - BROADwhere to find great cheap used banjos - PHRASEcheap used banjos - EXACTThus, I get to bid aggressively and ensure that I am extracting the maximum number of impressions from my "cheap used banjos" keyword, while finding new phrase and even broad matched variations and getting a feel for how they perform.If the "online banjo store" keyword turns out to be a great performer, I can give it it's own "broad but focused" test run and see if I can't discover a whole new vertical of keywords...on the cheap!
The Value of Great Keyword Lists
The moral of the post is really that keyword lists are valuable assets. If you would pay a monthly subscription for a keyword tool, why not invest some of your PPC budget in finding new keyword verticals? Why not pay to get data about how specific keywords and bids work for you or your client specifically?Paying a little now for a proprietary, site-specific keyword list can offer you big returns in the long run.