Guidelines for Competitor Bidding

April 01, 2015
Rowan Kleij
PPC

Should You Do It? Guidelines for Competitor Bidding

A dilemma that advertisers often face when looking for ways to improve their account’s performance is whether to bid on competitors or not. Intuitively, it makes sense; it is much cheaper on average than bidding on generic keywords, and you are effectively stealing your competitor’s traffic. Additionally, if your main competitor offers very similar products/services as you, chances are that the quality of traffic will be high. However, competitor bidding is not a risk free strategy. Often times, competitors will retaliate by bidding on your brand, which inflates average CPC’s and in turn will cause brand leakage. Being aware of the potential repercussions, if you still decide to bid on competitors, it is vital you have a sound approach. Below I have highlighted some guidelines for competitor bidding.

What benefits does your product/service have over the competitor you are bidding on?

This is a important consideration when writing competitor targeted ad copy. Keeping in mind that the search query is the user’s primary signal of intent in search, we can assume that you are already at a disadvantage. Doing competitor research and comparing your offering to theirs will be the foundation for writing compelling copy which could persuade users to visit your landing page instead of theirs.

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From the above comparison between your website and a direct competitor, it would make sense to highlight your website’s superior welcome bonus, its mobile responsiveness and the wider assortment of Desktop games.

The ad copy example below has an engaging headline which proposes your website as an alternative to the competitor, with the description line highlighting a core advantage of why users should consider visiting your website.

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Get to grips with Adwords Trademark Policy

Understanding Adwords Trademark Policy is another important consideration when bidding on competitors. As most advertisers are aware, ads cannot use restricted trademarks in their ad copy, and can result in the ad getting disapproved. However, there is a caveat to this, as it is possible to include the competitor name in the Display URL of the ad:

“Google can investigate and may restrict the use of trademarks in ad text. This process does not apply to trademarks used in an ad’s Display URL (the website address shown in green within an ad). Google will not investigate and restrict use of the trademark in display URLs because the presence of a trademarked term within a URL may not necessarily constitute trademark use, such as in the case of post-domain paths or subdomains.”

This opportunity is especially interesting for affiliates who would benefit from having the name of their respective businesses (e.g. bookmakers, online casinos, health insurance providers) in their copy:

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In the above example we created ad copy specifically around a Paddy Power offer, without explicitly showing the bookmaker in the headline or description lines. This is an effective way to take advantage of a well-known bookie name to entice users to click through without going against the trademark policy.

For the latest on Adwords trademark policies, please visit:

https://support.google.com/adwordspolicy/answer/6118?hl=en-GB

Do not bid too aggressively

Let’s face it, trying to outbid your competitor on their brand is fighting a losing battle. Their Quality Score on their own brand will likely be superior to yours due to their more relevant landing page and ads as well as a higher CTR. As such, your competitor strategy should be to gather incremental traffic and brand awareness rather than to dominate the SERP. This more conservative strategy may also be useful in avoiding too much scrutiny as an affiliate, or preventing an all-out bidding war!

Bidding on non-active websites

Just because a website or business has gone down does not mean that its respective search interest suddenly disappears. As such, being agile with your keyword coverage (before other competitors catch on!) can be a great way to capture qualified traffic who now are likely to be actively looking for alternatives. The below is an example of Virgin Active showing up for Esporta, a former chain of health clubs.

VAscreen

An important consideration is whether you want to explicitly include the Brand name of the defunct competitor in the ad copy. While it could theoretically lead to an improved CTR, it may be considered in bad taste and can affect your own brand’s reputation.

Conclusion

In summary, there are many variables to consider when deciding on competitor bidding. It is key to be aware of how your products and/or services stack up compared to your rivals, and take advantage of areas in which you excel through compelling ad copy. Not viewing competitor bidding as a means of SERP domination but rather as a way of driving incremental traffic to your site can prevent a full-scale bidding war which you are bound to lose. Lastly, from an agency’s perspective, communicating with the client on strategy around competitor bidding should be a priority in order to gain insight into any gentlemen’s agreements which you need to be aware of.

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Rowan Kleij

Rowan is a Senior Account Manager at The Media Image, where he leads a team working across several key clients in the finance, travel and e-commerce industries.
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