SEM: Should I Bid on Competitors鈥� Brands?
For our clients, search engine marketing continues to be one of the most reliable, affordable sources of site traffic鈥攚ith the potential to produce quality visits from new visitors. But the strategy behind it can be complex. One question that seems to be asked of our search pros regularly is, 鈥淪hould I be bidding on my competitors鈥� brands to steal market share from them?
To answer this question, we should revisit the subject of and how Google promotes relevance. When determining the cost of a click, Google considers the keyword鈥檚 relevance to ad copy and landing pages. In Google-speak, relevance is 鈥渜uality.鈥� Relevant ad copy captures interest and creates click-through (CTR). And in Google鈥檚 eyes, quality and CTR are tightly correlated.
Because of this system, your brand keywords have more relevance to your website than any other site, so their quality and CTR are high. Dana often recommends bidding on your own brand because:
- It鈥檚 the least expensive, above-the-fold advertising you can buy on Google.
- It provides tight copy and landing page control and flexibility. (You can respond nimbly with offers that are paid off on targeted landing pages.)
- Cost-per-click is low, and total spend is low, while clicks, CTR and site visitor interest are high. And even if you discount some percentage of conversions, ROI is high.
- Competitors may be bidding on your brand.
So how does this thinking apply to bidding on competitor brands?
Google makes it hard to serve up relevant ads on competitor鈥檚 brands. You can鈥檛 use other brand names in your ads without permission.* And Dana doesn鈥檛 recommend building landing pages optimized for competitors鈥� brands.
(*Note: this doesn鈥檛 apply the same way to distribution channels such as online travel agents or a retailer like Amazon.com. If Expedia is selling your hotel, it CAN serve an ad with your brand in it, and it CAN drive PPC traffic to a landing page about your property.)
If, however, you choose to go ahead with bidding on a competitor鈥檚 brand, you can expect:
- High cost per click
- Low click-through ratio
- High bounce traffic
Google does seem to give competitor campaigns a shot. Google may start you off with a mediocre quality score and then lower your score and impressions if you don鈥檛 produce quickly. But there鈥檚 also the possibility that your competitors will start bidding against your brand. Which could raise the cost of your own brand search. Furthermore, it may actually lower the quality of all your campaigns鈥攖here are varied opinions on the idea that one low-quality campaign can drag down others.
So for clients who insist that we pursue competitors, we do. But invariably, those campaigns exhibit poor 鈥渜uality鈥� as defined by Google (a.k.a. low CTR). We have seen a few campaigns produce, if measured purely on a cost-per-conversion basis. In these cases, impressions, clicks and total cost are low, but the occasional conversion nets a low cost-per-conversion. These situations most often occur when the competitive set is somewhat interchangeable. When customers are buying a commodity, they are more likely to be persuaded to change their buying decisions based on product comparisons and reviews.
At Dana, we feel the greatest opportunities lie in serving ads to prospects that are looking for what you have to offer. Ad copy and landing pages specifically designed to pay off each individual search query will provide the best results for the effort invested.
Still feel like your head鈥檚 search engine is spinning? For additional questions or information, contact mdamico@danacommunications.com.