Does Having Your Keyword In Your Domain Rank Higher?

This is one of the controversial questions in many of the SEO (Search Engine Optimization) forums, yet it is very easy to answer for any particular search engine. This article conclusively answers that question for the leading search engine.

The methodology is really quite simple for this question.
I gathered the results of the queries I naturally performed last month using the leading search engine and analyzed them. It was a simple matter of counting the number of listings that had the keyword in the domain vs. those that didn't. This data was tabulated against the ranking for the first 8 search engine listings.

Here is the graph:
http://www.SearchEngineGeek.com/graphs/clg01.jpg (Note to webmasters: You have permission to hot-link to the graph, text link to it, or even copy it to your own site)

The X-axis shows the ranking from 1 through 8 on the leading search engine. The Y-axis shows the number of domains that contained the keyword. There is an obvious correlation, which shows that domains containing the keyword are more likely to be ranked in the higher positions than domains that do not contain the keyword.

Notes:

1. For the purposes of this test, only the domain portion of the URL was studied. So, the following would have been the results for the following URLs for the keyword "widgets":

http://www.widgets.com/widgets (yes - domain contained the keyword "widgets"

http://www.abcwidgets.com/abcd (yes - domain contained the keyword widgets)

http://widgets.abc.com/ (yes ~ domain contained the keyword widgets)

http://www.abc.com/widgets/ (no ~ although the URL contained the keyword widgets, the domain did not!)

Basically, the domain was considered to be any portion of the URL after the http://, but before the first slash which would start the rest of the URL.

2. Over 1,000 queries were examined for this test.

3. There was no exercise to attempt to isolate different keywords. I merely took a random sampling of the queries I performed during the month.

Conclusion:

When looking at the first 8 positions, the leading search engine ranks domains containing the keyword (search phrase) higher than domains that do not contain the keyword. This is merely a correlation study, so it cannot be determined from this study whether the leading search engine purposefully entertains this factor or not. The actual factors used may be far distant from the factor we studied, but the end result is that this search engine does, in fact, rank domains containing the keyword higher.