On May 5 Google changed its trademark policy for the UK and Ireland, opening up keyword bidding for trademarked keywords in Google AdWords. In essence this means anyone, including your competitors, can bid for your trademarked brand and appear in the Google sponsored links. However your trademark will still be protected from being used in the creative, the pay-per-click (PPC) ad copy itself.
What was the trademark restriction?
Previously, if you submitted a Google trademark complaint procedure you could prevent your competitors from bidding for your brand name in PPC ads served in the UK and Ireland. The benefit? You would be the only one in the paid listings appearing for your brand term, which meant it was cheap to drive traffic to your website through your protected brand term.
Meanwhile, the open market for bidding on trademarked brands has been in force in Canada and the US since 2004, allowing Hitwise to compare results. They show that 91.8 per cent of brands searches ended up on the brand owners’ websites in the UK, compared to just 84.2 per cent in the US. This equates to a 7.6 per cent gap, equivalent to millions of searches every day.
Lost traffic isn’t my biggest concern though – the real problem is that cost-per- click (CPC) will skyrocket. You will have to pay more to bid for your own trademarked brand, as anyone can now bid for these. This will hit the big brands hard, as a big part of their traffic is likely to be generated through brand related keywords. For smaller brands it is an opportunity, with the possibility to bid for bigger brand terms.
Why has Google done this?
The official line from Google is it will improve the user experience because they will have more options and therefore make a more informed decision. However, this change could also be connected to the fact that Google’s share prices were down by 38 per cent in February 2008 compared to July last year.
By allowing bidding on trademark terms, Google is likely to significantly increase the number of clicks through its paid search model and inflate the value of those clicks along with it. Google is taking a risk here by jeopardising the relevancy of results: when a user searches for ‘Rackspace’, for example, they don’t want to be presented with every other hosting company under the sun, not to mention third party sites and affiliates. PPC advertising used to be a solid ground for online brand awareness. If you had a trademarked brand you were protected and could get significant traffic at low cost.
It is believed 74 per cent of search engine users prefer (and trust) organic results more than paid listings. With the PPC results filling up with more irrelevant results, will this increase the user preference to organic? In my opinion this is a risky time for Google to be changing anything that can upset the quality of its paid search listings, especially since organic listings are getting stronger because of the addition of visual aspects, such as videos and news clips.
Dealing with the changes
Perhaps the biggest threat posed by this change is the opportunity it opens for the affiliate community, as they are the only ones that will benefit. This is the largest threat to the quality of Google’s paid listings, and detrimental to the user experience. The best way to deal with it is to develop a strategy with a selection of affiliate partners to protect your brand and allow them to bid on your brand, holding a pre-agreed position. Although this is unlikely to prevent all competitors and affiliates from bidding on your trademark, it may help gain control.
For larger brands it might be worth liaising with competitors to reach a mutual agreement not to bid on each other’s trademarks. It’s unlikely you can prevent everyone from bidding on your trademark, but your largest competitors are more likely to have the budgets to make an impact in bringing the CPC up.
What is vital at this stage is not to panic; if you put your maximum CPC up to protect the first position for your brand term, you are likely to drive costs up. The first port of call should be spending time developing a strategy for how to deal with these changes. What is clear is that it will change the paid search landscape and although it may open opportunities, I believe it’s far more detrimental to the quality than beneficial.
[email protected]
Related articles
COMMENT: Search – to pay or not to pay? – 01-05-08
Or use our enhanced search functionality to find other related articles
