Competitors bidding on brand terms has been a frequent topic of conversation with our clients over the past few days.
If you have been in the world of search advertising (Google Adwords, Bing Ads, etc.), competitors bidding on your brand terms is not a new practice. There is a fancy name for it: CONQUESTING. Advertising on Amazon is no different, and you see this in full effect now.
The challenge for brand owners is if a competitor starts bidding on your brand terms aggressively, defending against them can get very expensive very quickly. We have seen brand term CPCs spike up drastically, especially if you are in a category where there are multiple deep-pocketed advertisers with a win-at-any-cost strategy.
In our opinion, bidding on brand terms should be heavily tilted in favor of the brand owners, meaning, competitors should be paying significantly higher CPCs than brand owners for the same click. Perhaps information from the brand registry could be taken into account while determining CPCs and in the process favoring brand owners.
After all, advertisers much rather spend their budgets on non-brand keywords and drive incremental sales as opposed to defending their turf that they have painstakingly built over time.
Until then, what should brand owners do? While there are no easy solutions, here are some tactics to consider:
- Track competitors bidding on your brand terms
- If you decide to defend aggressively, gradually bid-up until you unseat them in the top spots
- Lower bids as long you are able to keep the top-spots. This way, you spend just enough and nothing more