We get asked this question fairly often. In fact, it’s probably one of the most confusing aspects of Pay per Click. A competitor who bids on your brand terms is trying to divert traffic from your site. But what can you do about it? Let’s break down the policies on brand terms, talk about ways to protect your brand online, and look at performance statistics if you bid on your competitors’ brand terms.
Brand term policies
Ad Text: Google will investigate and may restrict the use of a trademark within ad text. Ads using restricted trademarks in their ad text may not be allowed to run. This policy applies worldwide.
Keywords: Google will not investigate or restrict the use of trademark terms in keywords, even if a trademark complaint is received.
Ad Text: Advertisers are not allowed to use competitor’s trademarks in their ad components (e.g., title, text or display URL), except when used comparatively and supported by third-party research.
Keyword: Advertisers are now allowed to bid on other advertiser’s trademarked terms as long as they are categorically relevant.
What Can I Do?
- Bid on your own brand terms. We know there is a lot of debate around this but at Location3 Media, we say “yes.” Bidding on your brand terms helps protect your brand and lets you customize messaging to current specials and seasons
- Take advantage of all ad extensions. Google now offers 8 ad extensions and Bing offers 3. Using ad extensions helps expand your real estate and control your messaging with features not available in your organic listings
- File valid trademark complaints on Google and Bing/Yahoo! to ensure that trademark policies are not being violated
- Create a handshake agreement with your competitors. A simple discussion could alleviate concerns about why your competitors are bidding on your brand terms and what you should do
- Have clear brand keyword guidelines for your affiliates. Have affiliates control their bids on brand terms to be below position 1, so your brand can take full advantage of that spot without having to compete on bids
Should I Bid on my Competitors Terms?
Although the policy for bidding on competitor terms varies from company to company, here are some interesting statistics when we’ve run campaigns on competitor terms:
- CTR for competitor terms is significantly lower for competitor terms. In one instance, the CTR for competitor terms was .23% while the CTR for the rest of the keywords was 2.01%
- Traffic on competitor terms resulted in only 2.74% of overall traffic while accounting for 4.64% of spend
- Competitor terms only contributed .05% of total conversions with a cost per conversion that was 5X more than all other keywords
With these statistics and the negative impact that having a low click through rate can have on quality score, brands should definitely understand the pros and cons of bidding on competitor terms before setting up specific campaigns.
Instead of running Pay per Click on competitor terms, get your brand out in front of consumers before they are committed to another brand. Using the Google or Bing display network would be a great way to introduce your brand to consumers before they are brand loyal.