search marketing blog: ambergreen

The recent decision by Google to allow brand owners bidding for keywords that are trademarked by rivals has not been welcomed by certain sections of the industry. UK’s largest supermarket chain – Tesco is the first major advertiser to have shown its discontent in this sudden change brought about by Google.

The latest rule by Google that comes into affect from May the 5^th is expected to bring a lot of change and conflict amongst UK’s biggest and highest spending advertisers. Consumers who search for specific brands such as “Tesco” will for the very first time be given sponsored listings for its competitor brands.

Tesco taking a moral stance has made it openly apparent that they will not bid for on any search terms that are related to its competitors. Tesco currently is spending more than £2 million every year on its online advertisements campaign and hopes that other UK brand owners will take a note of its decision which is to prevent unnecessary rise in the money being spent on paid search ads.

High profile brands such a Diageo, Mercedes-Benz and O2 have already started anticipating the major change that this rule will bring about in the market and have begun revising their approach towards Google paid search.

Bidders will now have to pay more as this change is most likely to result in the prices of branded paid search listings to rise. In the past advertisers had the chance to purchase trademarked search terms at a lower price which enabled them make considerable gains from their sponsored search advertising activity.

We are delighted to announce we will be exhibiting at this year’s Internet World Exhibition, Earls Court, London from 29th April – 1st June 2008.

If it’s happening in the digital business world then it’s happening at Internet World. With over 200 inspirational hours of free seminars and hard-hitting keynotes, it’s the one and only place you’ll hear the ultimate digital business insight and understanding.

We are exhibiting at stand number E366, so please drop by and see us there or contact David Goldie on info@ambergreen.co.uk to arrange an appointment in advance.

Our Technical Director, Grant Whiteside and Thomas Cook’s Russell Gould will be presenting “How to build an e-superbrand” Case Study in the Digital Marketing Theatre on Wednesday 30th April at 12pm.

How to Get There By Air

Heathrow Airport

The easiest way to travel to Internet World from Heathrow is to take the Piccadilly line direct to Earls Court.
Alternatively you can also use the Heathrow Express to Paddington and then transfer to the District Line to Earls Court.Contact information for Heathrow are as follows:

General enquiries - 0870 0000 123

www.baa.com/heathrow

Gatwick Airport

The easiest way to travel to Internet World from Gatwick Airport is to board the Gatwick Express service to Victoria where you should transfer to a direct train to
Earls Court

You can also use frequent train services that run through Clapham Junction where you can then board a direct train to Earls Court

Contact information for Gatwick are as follows:

General enquires - 0870 000 2468

www.baa.com/gatwick

Stansted Airport

The quickest way to Internet World after arriving at Stansted Airport is to board the Stansted Express and travel to Liverpool Street, where you can take the Central Line to Holborn and change onto the Piccadilly Line which will take you to Earls Court.

Alternatively you can change onto the Circle Line at Liverpool Street and travel to Edgware Road, where you should then change onto District Line to Earls Court.

Contact information for Stansted are as follows:

General enquires - 0870 0000 303

www.baa.com/stansted

City Airport

The quickest way to Internet world from City Airport is to board the Docklands Light Railway from City Airport to Canning Town. There you should transfer onto the Jubilee Line Westbound and travel to Westminster. Here you should then change onto the District Line Westbound to Earls Court

Contact information for City Airport are as follows

General enquires - 020 7646 0088

www.londoncityairport.com

The last post on this blog discusses the trademark changes for Google. When asked Google’s reason for these changes we can only guess at the reasons, but I wonder if the reported revenue percentage drop has anything to do with it. Google UK’s revenue accounted for 15% of the search engine’s total net income according to its first-quarter results, up 1% on last year’s fourth-quarter results but down 1% on the same period last year.

Google also revealed a total rise in net profits of 31% to $1.31bn (£655m) and revenues for the UK alone totalled $803m (£402m). With their dominance in the marketplace these profits come as no surprise, we can only hope for the merger of MSN and Yahoo to shake things up a bit and make for a more interesting search landscape!

As you may have read in the papers, blogs and other media, Google have recently announced that as of May 5th they will no longer bar people bidding on trademarked keywords in the UK and Ireland, a 180 degree turn from their previous policy. This announcement has sent ripples through the online marketing world, with advertisers and agencies alike spreading panic as though the entire internet were about to shut down. However, the impact is likely to be fairly minimal, for the following reasons.

Firstly, this is not a one-off experiment. Google has never enforced such a trademark policy in the US and there is absolutely no problem with it there. Paid Search, and AdWords in particular, continues to be an extremely cost-effective and targeted form of marketing despite the presence of competitor ads on branded searches.

Secondly, there is no reason to assume, as many self-proclaimed experts have done so in the media, that CPCs on previously protected keywords will suddenly sky-rocket as a result of increased competition. This is because Google are continuing to prohibit the use of trademarked terms in ad copy unless the trademark holder gives permission. The upshot is that a search for “Company X” will also display ads for “Company Y” and “Company Z” BUT the user is specifically looking for Company X and only one ad will contain that keyword. This ad will continue to attract clickthrough rates much higher than those of the competing ads and will consequently have a much higher quality score. This quality score will counteract the effect of competing bids on CPC so average CPC will rise only slightly while leading rankings are maintained. On the other hand, competitors will be forced to pay high CPCs for any clicks they attract because of their relatively low quality scores.

A final point of note is that the policy also opens up the possibility to bid on your own competitors’ trademarked terms if such an approach is attractive to you. Such a campaign should not be looked upon as a way to ’steal’ traffic from other sources; as noted above such traffic will come at a high cost. However it is an excellent opportunity to raise brand awareness, advertise new product lines relating to those of a competitor and advertise any USPs which may give you an edge over competition. The aim for such a campaign would primarily be impressions rather than traffic.

In the end this all boils down to a storm in a teacup. Yes, there is the fact that brand campaigns will now need slightly more care and attention in the light of new competition; and yes, branded terms may start to cost more than a couple of pence each. However, this can only be a make or break point for the weakest and most marginal campaigns. The purpose of the policy change is simply to open up some more revenue for Google but it’s evident they have enough sense not to endanger their entire advertising network for the sake of a few dollars more.