How do you check keywords competition?

I recently updated my tool at http://www.nichewatch.com there it uses different matrix to come up with keywords competition strength.

What are your matrix to establish keywords competition?

 

I would call my method of research a matrix; but a comparison of competitor sites for that specific keyword. Included is actual research on the keyword itself, like search volume and monetary possibilities.

1. I review the actual keyword; checking to see how much search volume the keyword actually gets using the exact match value in Google's Adwords Keyword Tool. Then, use the Google Adwords Sandbox Traffic Estimator to get an idea of what advertisers are paying via Adwords (which compliments AdSense returns; at a value of 10-15% for the content network). Then, take a look at Google Trends to see if the keyword traffic is stable, increasing or decreasing over time.

2. Next, it's time to review the actual competition for the specific keyword. I would build a list of 20-30 of the top ranking sites for the keyword and review the actual on-page optimization. Checking to see if they are putting effort in this field and if so how many sites adhere to publicly acknowledge on-page SEO design. This helps me understand greatly if any real SEO work is being done.

3. Now, I check the backlinks for the sites I've listed in #2, checking to see the amount of backlinks each site has and reviewing what anchor text is used in what percentage for each site with the SEO Book Link Harvester. This gives me an idea of how many quality backlinks each site has and what type of work will be needed to complete with these backlinks. I also use this opportunity to see which backlinks I can mimic; like blog posts, forums, articles, etc.

4. I look to see what keyword rich domain names are available for this keyword, trying first to obtain the exact keyword or keyword phrase domain name or something very similar using "one" hyphen or a complimenting word.

This is just a quick overview of some of the things I do that you all can try out and see if they work for you. In the words of a cook, I can't give away the whole recipe.