3 Benefits of Bidding on Competitor Brand Keywords

It is a common practice in PPC marketing to bid on competitor brand keywords. We call it Brand Bidding and it can be a powerful tool to gain brand awareness and qualified conversions to your business. This strategy isn’t for every business but below are 3 benefits to bidding on your competitors.

3 Benefits of Bidding on Competitor Brand Keywords

Do a search on Google for any well-known businesses and chances are you will see a spectrum of competitor ads. There’s a reason for this. Targeting a competitor’s brand keywords is cost-effective, qualified, and can help bring awareness to your brand. This doesn’t mean brand bidding is for every business, but the following three reasons may help you decide if it’s right for you.

1. Clicks are Cost-Effective

The number one factor that determines the cost per click in PPC marketing is the amount of competition bidding on the keywords. The more the competition, the higher the price is driven to compete for the top spots in search results.

Brand keywords are generally searched less than service or product keywords and there are typically less companies competing for the digital space. This results in lower cost per clicks on average and can be a great way to get affordable leads for your business.

2. Traffic is Already Qualified

Assuming you are targeting competitors with similar products or services as your own business, the traffic should already be qualified. It is totally legal to bid on competitor brand keywords and you can take advantage of the heavy lifting their PPC management team has already done.

You should expect to see a lower CTR (click-through-rate) on brand bidding campaigns, but your conversion-rate should be higher than general service campaigns. This is because you are catching leads at the buying end of the spectrum and they have already done the research and are ready to make a purchase.

3. Increase Brand Awareness

Because you only pay for clicks to your own ad, an additional value to bidding on competitor brand keywords is the amount of free exposure you get. Just because fewer people are clicking your ad, doesn’t mean you aren’t getting value from brand awareness. Often, searches are just starting the research process and they start with the best-known brands. They may find that the competition isn’t what they are looking for, and seeing your name show up in search results next to your competition is a good sign that you serve the same products or services.

For smaller companies or companies just entering the industry, brand bidding can be an easy way to expose yourself to users looking for your product.  The smaller you are, the more bang for your buck you might get.

Like I said before, this strategy isn’t for everyone. Some common signals that you may not want to bid on competitor brand keywords are:

  • You sell a truly unique product and have no direct competition.
  • You find that too many competitors are bidding on brand keywords and it isn’t cost effective.
  • You have more leads than you can currently handle.
  • You fear starting a bidding war which could drive your brand price up.

If you think your business is in a position to benefit from brand bidding and you don’t fear retaliation from your competitors, below are a few tips to properly implement a brand bidding strategy.

Tips for Targeting Competitor Brand Keywords

Only target competitors with similar products.

The worst mistake you can make when brand bidding is targeting companies that aren’t direct competitors. Just because you are in the same industry, doesn’t always mean you are in direct competition. An example is online versus physical businesses. Make sure the search intent is the same for you and your competitors before choosing to target them.  

Use ad copy that highlights your unique selling proposition (USP).

Because competitor brand campaigns are so targeted, you know exactly who you are speaking to and can customize your ad copy to speak to your exact USP. This can be a powerful tool if you truly understand how your product is superior to your competition.

In addition to highlighting your differences, this is a great place to offer special promotions. Because these are highly qualified leads, it could offset the additional cost of acquisition.

Never use a competitor’s name in your ad copy.

Google has very strict trademark policies and the last thing you want to do is break the rules and get your account shut down. The main thing you should recognize is that you are never allowed to use your competitor’s name in your ad copy.

You can say a lot by describing your differences but make sure to not be too obvious. Even if Google allows it, your leads could be turned off by too direct of an attack. You want to be careful about being too off-putting.

Don’t target the top position.

The goal here isn’t to be in the top position. That is a great way to blow up your cost-per-acquisition (CPA). Your goal is brand awareness, and you should already expect to see lower than average click-through-rates (CTR). Aim to be in the top 3 positions unless you find that there are too many competitors bidding for these positions.

Don’t bid too aggressively on mobile.

You should also consider search intent on mobile devices versus desktop. Mobile searches for products or services differ in intent and more often mean they have made the buying decision already and are not still doing research. Bidding too aggressively on mobile devices will usually return a lower click-through-rate and conversion rate.

Be cautious of a bidding war.

As we mentioned before, brand bidding can get personal and the last thing you want is to start a bidding war. If you are running branded campaigns for your business, you may want to note if competitors are showing up for your brand keywords. In larger industries like digital marketing there are more brands than you can count, and it may brand bidding is completely normal and expected. In other, smaller industries, you may have an intimate relationship with your competition and bidding on their brand keywords can incite retaliation.

The best thing you can do is to remove emotion and recognize when things have gone too far. If you notice your brand campaign costs increasing to the point they are no longer converting at an affordable rate, you way want to consider the strategy of brand bidding.

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