When we do keyword research, we know that we’re supposed to be mentally balancing the amount of traffic a keyword gets with how competitive it is to rank for that keyword.  A term does us no good if we can’t rank for it, obviously.  But, by the same token, it’s pretty pointless to rank for a term that receives almost no traffic.  So there needs to be a balance struck between the two.

Keyword Effectiveness Index, or KEI for short, is a mathematical formula quantifies that balance in a numerical way.

The formula balances the amount of monthly searches for a term (represented by P for Popularity) and the amount of results returned for the term (represented by C for competitiveness).

Here is the formula for KEI:

KEI = P^2/C

Of course, KEI is merely one factor to consider when deciding whether to attempt to rank for a particular term, but it is the generally accepted wisdom that any KEI score above 40 indicates that a term would be effective.

I hope this explanation of KEI has cleared things up!

*melanie

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