Implied odds aren't an exact science, but once you understand the basic concept, implied odds will influence the decisions you make and why you make them.
Implied Odds are similar to pot odds, however, they take into consideration the possible future actions of your opponents and the potential value that you will be able to extract from an opponent given a certain situation.
Put simply - If you expect to win a significant amount of money from your opponent given that you make your hand, then you have strong implied odds.
For example, let’s consider the situation in which you have a flush draw on the flop.
Your Cards: 79
Flop: 10k5 (Pot: $20)
The pot is $20, and your opponent leads out onto the flop with a pot-sized bet, making the pot a total of $40. We will assume that your opponent holds some type of king. In this situation, the pot odds are 2:1, since you must make a call of $20 in order to have the chance at winning $40. Your odds of making your flush on the turn card are 4.2:1 or 19.1% (there are 9 clubs left in the deck and 47 unknown cards, so we have a 9/47 chance of making our flush on the turn.) From this perspective, it is unprofitable for you to call your opponents bet since the odds are against you hitting your flush on the turn. However, our implied odds could make it profitable to call in this situation versus certain opponents.....
If we conclude that it is highly possible for us to extract significant value from our opponent on the turn (assuming we make our flush), then it could be profitable for us to call his bet on the flop.
It depends on your opponent: When gauging our implied odds, we must consider what type of player our opponent is, making use of any use of any previous encounters we have had with them on the table. If we know that he will happily bet or call down the board with top pair, then hitting our flush would prove to be highly profitable. Furthermore, his stack size must be accounted for; For example, it won’t be particularly rewarding for us to call his flop bet if he will only have 20bb left when we turn our flush.
Previous encounters we have had with them on the table. If we know that he will happily bet or call down the board with top pair, then hitting our flush would prove to be highly profitable.
Calculating Implied Odds
Calculating exact implied odds is an imprecise art. Imperfect information on our opponent accompanied with a time restriction at online poker rooms means that we must make an educated guess regarding our implied odds. Using our flush example above, we must take our specific opponent into mind and consider if we will extract additional value from them if we make our flush on the turn. If not, then it won’t be profitable for us to call on the flop.
Odds of making your flush: 4.2:1 (19.1%)
Pot Odds: 2:1 (costs you $20 to have the chance at winning the $40 pot on the flop.)
Odds of making flush minus Pot Odds = 2.2:1
The above figure (2.2:1) is our implied odds. Multiplying this by the $20 call we would need to make on the flop, we get $44. Thus in order to profitability call our opponents flop bet given our hand equity, we must extract an additional $44 in value from them when we make our flush.
Ultimately, the examples provided should serve as a reference point for you when making decisions in a competitive situation.