On the 5th May 2008, Google changed its trademark policy, allowing advertisers to bid on previously trademarked brand terms. This article will outline exactly what those were and what they mean for advertisers going forward.
What exactly has Google changed?
On 5th May 2008, Google changed its trademark policy, allowing keyword bidding on previously trademarked terms (excluding terms that remain blocked i.e. gambling & sex related terms)
This means that advertisers can now bid on competitor trademark terms in industries such as finance, recruitment, retail and many more. For example, ‘Ryanair’ is now able to bid on previously trademarked terms such as ‘Easyjet’ if they chose to adopt this strategy.
Google argue that by opening up keyword bidding across trademarked terms they are providing their users with a more rounded and relevant search experience.
So what actually happened when Google implemented these changes?
Pre May 5th 2008
Registered trademarked terms blocked by Google. Any company wishing to appear on these terms needed the trademark owner’s authorisation. Due to low competition on trademark terms CPC’s (cost per clicks) were low and offered good value for money for advertisers.
May 5th 2008
Google change its policy on trademarked terms to allow bidding on these terms to the open market (excluding gambling & sex related terms). As a result, trademarked term CPC’s increased significantly as competitors launched aggressive keyword campaigns to target previously blocked terms.
TBG saw some of its client’s trademarked terms rise by as much as 50% on the days following May 5th.
Post May 5th 2008
The number of competitor ads begin to reduce as Google evaluate their relevancy rating or quality score.
But why is this? Due to poor quality score ratings, bids on trademarked terms for irrelevant adverts were raised to a minimum CPC of £2.50-£5.00. Therefore, the minimum CPC an advertiser can bid to be active on the trademarked term would be £2.50, a similar cost to that of generic, non-trademarked terms.
As a result, the ‘value’ opportunity of bidding on low CPC competitor trademarked terms disappeared.
As the weeks have progressed, the cost of previously trademarked terms have declined as competitors have chosen not to pay the minimum CPC’s implemented by Google.
Conclusions & recommendations
The change in Google’s trademark policy has meant that it has become important to protect your brand online from competitor ads. Although, competitors will have to pay a premium to appear on previously trademarked terms, their presence could result in the loss of customers as they are drawn in to competitor offers.
TBG would recommend the following to help protect trademark terms in the short to medium term:
- Brand Monitoring: Daily checks on competitor activity on previously trademarked terms
- Set up brand affiliate campaigns to have a second presence on trademarked terms and thus ensuring competitors are not in top positions
- Brand Optimisation: Previously trademarked terms were not the focus of optimisation strategies, however now it is increasingly important to improve brand performance via creative ad testing, positional strategies etc
It has also been reported that some advertisers have approached competitors directly to request the removal of owned trademarked terms. If undertaking this strategy, TBG recommends seeking legal advice as there are legal implications for organisations seen to be colluding with one another.
The above strategies, combined with the increased competition on previously blocked terms, will mean that trademark sales that previously generated higher ROI, will be more expensive, require higher maintenance costs and thus potentially become closer to the cost of generic generic term sales.
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