As you might know, last month Google won its six-year court battle with the ACCC. The case related to Google serving search results that were deemed to be “deceptive” – where a search for a brand would serve an ad that leads to a site not owned by that brand. One example would be where a user searches for “Toyota” and Google serves them an ad for Holden instead.
The search world knew that a Google win would mean the departure of brand protection in Australia. Google announced that change last week and from 23 April, AdWords will change its policy in Australia, aligning it to the rest of the world.
Until this decision, companies with a trademarked brand or products could register those trademarks with Google. This meant that the trademark owner could control who they allowed to appear in the search results for those trademarked terms. For example, Dyson may allow its resellers – but not its competitors – to bid on the “Dyson” brand.
From late April that option will no longer be available. The only protection Google will now provide is stopping brand-protected terms appearing in the ads non-whitelisted companies show. For example, Pepsi could bid on the word ‘Coca-Cola’ but couldn’t serve the ad copy below as it uses the Coke brand in the ad itself:
What is the best cola?
People have consistently chosen
Pepsi over Coca-Cola – Find out why!
Cause for concern?
From what we’ve seen in markets that have already gone through this change, we know there will be immediate cost increases. As the dust settles and advertisers experiment with this newfound freedom brand, Cost Per Clicks (CPC) will increase. AdWords is basically an auction, so if there are more companies entering the auction of course prices will increase.
If we look at the majority of large brands in more mature search markets, there are limited examples of competitor brand squatting. There are a number of reasons as to why, but one key one is expense. AdWords is a blind auction with a vast number of factors that affect the price you pay for a click (CPC).
Back in the day, Google understood that the only way to win the search engine race was to focus on its consumers and provide them with the best search results. Google understood that relevancy was pivotal to AdWords’ and its own success. An easy way for AdWords to measure whether the advertiser is relevant to the search term is whether that search term appears in both the creative and the landing page. If there is no relevancy, then that advertiser has to pay a higher CPC.
Your competitors will not to be allowed to use your brand term in their ads (as that is still protected) and would probably choose not to have it on their website. Therefore, Google will deem them not relevant and their CPCs will often be too expensive.
What can brands do?
While your competitors won’t be able to use your brand in their ads, they can bid on your brand name and serve their own advertising to potential customers who are searching for your brand – and this can damage your campaigns. To stop that happening there are a few simple steps you need to take:
1) Ascertain whether you take advantage of this opportunity yourself. If it can provide a positive return, maybe it makes sense. You could even build specific landing pages to take maximum advantage.
For example Pepsi could bid on the brand ‘Coca-Cola’ and use the following creative:
What is the best cola?
Since 1975 people have consistently
chosen Pepsi. Want to find out why?
2) Contact competitors and discuss an amnesty where neither side takes advantage of this change. Brand squatting probably isn’t that attractive to new and existing customers anyway. (If you can achieve this maybe you’ll even decide not to bid on your own brand.)
3) Employ software to monitor who is bidding on your brand. AdGooroo and Adthena are two potential choices.
4) Liaise with re-sellers and affiliates to ensure you’re in control of how they use your brand. Your contracts with them should define how they can use your brand and your search or marketing agency should be able to help you produce those clauses.
Outrider’s belief is that the key threat comes from affiliates and resellers as opposed to competitors. You need these parties to be providing incremental sales and leads, and brand squatting effectively means they’re robbing Peter to pay Paul and you’re paying for the privilege.
There are benefits in allowing affiliates and re-sellers to bid on your brand but that can only be ascertained by having a holistic view of overall conversions. Until you have that view it’s probably best to ensure that you are the only company bidding on your brand.
We don’t believe that this change is anything to fear and if you prepare well, you will be well placed for this imminent change.