Bidding on competitor trademarks

Trademark bidding is the act of bidding on paid search listings for keywords that contain a trademark. Trademark bidding on a competitor’s trademarks could result in legal action for trademark infringement or for breach of contract if one exists.

Legal action. If an advertiser sponsors a keyword that contains the trademark of a competitor, which is allowed on some search engines including Google, the advertiser could be liable for trademark infringement. There are several tests applied by the legal system of the USA to determine if the action is trademark infringement, which include:

• Use of the mark in commerce which leads to the question “is advertising on a search term considered use in commerce?” Some courts have ruled yes; others have ruled no.
• Is a normal, typical consumer is likely to get confused as to the origin of a good or service?

I am not going to go into the case law and legal nuances here as there are cases that have ruled that trademark bidding is a bad thing, and some that say it isn’t, depending on individual facts and circumstances. For our purposes, let’s just say it is a bad thing for the moment.

Contractual agreement. Outside of trademark law, if there is a specific agreement not to trademark bid between advertisers, then doing so would be breach of contract. There are some industries and even some competitors who have entered into prohibition agreements where they all agree never to trademark bid on sponsored search accompanied by specific financial penalties if it is done.

Even if you are in complete compliance, and have a strict policy of never trademark bidding, you could still find yourself liable if your affiliate marketers are doing it. The scenarios in which affiliate marketers could cause you liability include:

Direct linking. Direct linking is where an affiliate uses your display URL in its ads, the destination URL is the affiliate tracking link, and the landing page is your on website. Most affiliate programs prohibit direct linking, although that doesn’t mean affiliates aren’t going to do it. Programs that allow direct linking typically only prohibit the practice on a merchant’s own trademarks, but allow it on all other terms, including keywords that contain marks owned by competitors. Meaning you are tacitly saying that direct linking is OK on competitors trademarks. If your affiliate advertises on a competitor’s marks, using your brand name in the display URL, the ad looks like it’s you. This means that any legal action taken by the competitor will be taken against you!

You have to protect yourself from this behavior as it could wind up costing you more than the affiliate program is worth. First, be sure to prohibit direct linking on competitor’s brand terms in your affiliate agreements. Second, be sure to monitor your competitors branded keywords to ensure that your affiliates’ ads are not showing up on your competitors terms. If they are, take swift action to pull the ad down.

Landing pages that exclusively promote you. If your affiliates are trademark bidding using their own website as the landing page and display URL, you are in better shape than a direct linking scenario but could still face liability if the ultimate landing page promotes only one advertiser: you! If the affiliate’s landing page only has you on it, then you will not be off the hook for trademark bidding violations.

You must monitor this activity as well to ensure that if the affiliate is going to trademark bid, that the trademark owner is also promoted on the landing page.

Ad copy that mentions you. If your affiliates are trademark bidding using ad copy that exclusively promotes you, you might be on the hook as well. While you are not doing the marketing, the ad certainly looks like you are. Watch-out for this behavior as well.

Decide if you will allow this activity to occur. If you determine that it is against your rules, then make sure to list it in your affiliate program agreement.

Offers, claims and endorsements

The Federal Trade Commission (FTC) is the arm of the government that keeps things fair with regard to what can or can’t be claimed about a product in advertising. The big picture is that any offer or claim must be true. More recently, on December 1, 2009, the FTC enacted an extended interpretation of their guidelines which requires anyone endorsing a product who receives financial gain from it to disclose that financial relationship.

This means that offers and claims in search listing text/ad copy must be truthful, that offers and claims on landing pages must be truthful, and finally any web site such as a reviews site, flogger or blogger who is endorsing your product and is also an affiliate of yours must disclose this relationship. Failure by your affiliates can cause you as the business owner to find yourself facing down the FTC.

Here are your to do’s to C.Y.A.:

Educate your affiliates.Educate your affiliates on the FTC rules and guidelines. You may be able to satisfy this just by publishing a guidelines brochure that is sent to every new affiliate who signs up for your program.

Monitor your affiliates. You don’t need to monitor every day or every week, but you should have a process in place by which you do monitor your affiliates. For example, visit their websites once a year (or more often if you like) to ensure that if you are being endorsed, there is disclosure somewhere that states that this web site owner is your affiliate. Another example is to monitor the ad copy / search listings of your affiliates and review the text to ensure that all claims and offers are accurate and true.

Note: This article is not meant as legal advice. The advice I give is that you determine a process and policy for each of the circumstances laid out above, be sure to communicate your policies clearly to all of your affiliates via your affiliate agreement, and then monitor it all just to be safe.

• There are more than 3 advertisers sponsoring your brand terms or phrases on paid search.
• You are not always in the top ranking position in sponsored results on your brand terms or phrases.
• Your ROI is lower than you would like on your brand terms.
• Your CPC is higher than you would like on your brand terms.

If so, a good strategy is to empower a small group of special affiliate marketers to advertise on your brand terms under the structure of a carefully crafted affiliate policy, so that you and your special affiliates are in a partnership together. The ultimate objective of this strategy is to push your ads to the top of the page and to chase your competitors out of the market by making it less desirable to advertise on those keyword terms. The end result should be less competition on your brand terms, and lower CPC.

Step 1: Define your search policy

You will need clearly defined affiliate program rules that empower a handful of special affiliates—usually two to four affiliates—while at the same time restricting your other regular affiliates, which for some brands can number in the hundreds or thousands. Here are some of the rules you’ll want to put into place.

Display URL rules. Don’t allow your special affiliates to use your top-level domain as the display URL. For this strategy to work, you want your affiliates to each have separate URLs so that multiple affiliate ads will display in the sponsored listings simultaneously.

Ad copy restrictions. Define ad copy restrictions and perhaps even supply the ad copy so that your special affiliate team will not be showing ads that contradict yours or other affiliate ads. This includes offers and claims. For example, you cannot have multiple affiliates claiming to be the “official” web site.

Ranking restrictions. Don’t allow your special affiliates to outrank you on your brand terms. You want to maintain the highest position and you are using your special affiliates to prop you up. Therefore the affiliates will need to watch their CPC and page position.

Keyword restrictions. Allow your special affiliates to advertise on your brand terms. Do not allow your regular affiliates to advertise on your brand terms.

Landing page links. All of your special affiliates must have their own unique landing pages which link to you. You may want to consider building these landing pages for them and/or supplying the appropriate content.

Step 2: Pick your special affiliate partners

The next step is to identify the group of special affiliates who you will bring into the fold as your partner. You should select reputable affiliates or preferably an agency that specializes in CPA marketing. You should carefully screen the marketing practices of your selected affiliates to ensure that they have integrity and adhere to high standards in their marketing practices. This is both an up-front task and an ongoing maintenance task. Replace any special affiliate who is not following your rules if they don’t respond to a warning notice with a quick response to rectify any missteps.

Step 3: Inform all of your affiliates about the do’s and don’ts

You must inform your regular affiliates about any changes to your affiliate policy that impact them so that they do not interfere with your plans and goals.

Step 4: Monitor and report

For this plan to work, all of your affiliates must comply with your rules. Your regular affiliates and your special affiliates cannot be allowed to break your rules or you run the risk that their activities will interfere with your plan. You will need to carefully monitor search results pages, preferably with automated software that can provide reports to you on both your special and regular affiliate activities. You ought to also consider providing your special affiliates with access to your monitoring reports so that they can be fully aware of any “accidental” missteps on their part and make quick corrections.

You will also need to monitor the competitive landscape, your rank changes, CPC and ROI of your brand terms with a before and after look so that you can tell if the plan has had an impact. You will know that it is working when competition subsides (you have fewer competitors on your brand terms), your CPC/ROI has decreased. You’ll also know your plan is working if you are able to steadily maintain top position on your brand terms.

One last thought: Be sure to compensate your special affiliates in a “special” way that makes it worth the effort for them.Consider different commissions tiers, or offering co-op marketing dollars.

Here are the top four big changes, in my mind:

Google changes its trademark policy

On June 15, 2009, Google changed its trademark policy to make it easier for advertisers to use brand names in ad copy text. Prior to this change, Google restricted the use of brand names in ad text and was willing to take action to prevent it, allowing brand owners to authorize specific resellers to use the brand, while blocking everyone else. Under the new policy, Google allows previously disapproved ads to run on Google.com and the content network in the USA without the need for approval by the trademark owner. Essentially, anyone, except for direct and obvious competitors, are able to use your brand in their ads. For more on these changes, see my How To Protect Your Brand Under Google’s New Trademark Policies.

Google adds product images and pricing to paid search

Google more closely linked comparison shopping with AdWords sponsored listings with several new developments:

Product Extensions. If you search on keywords such as “snowboard pants,” you will notice a plus icon associated with a single advertiser accompanied by the following text: “Show Products From [brand] for [brand] pants.” Clicking on the plus sign launches a list of products beneath the ad, with images, titles and prices of products. This feature enhancement to AdWords is called “Product Extensions.” While it has been in beta testing for a period of time, Product Extensions launched in the USA to all advertisers on November 24, 2009. To use Product Extensions requires a Google Merchant Center account tied to your AdWords ad text. Product Extension enhanced ads are priced on a CPC basis. You can find details on Google’s blog here: http://adwords.blogspot.com/2009/11/product-extensions-available-to-all-us.html

Product Listing Ads.. If you search on keywords such as “snowboard jackets” you will see a list of products in positions four, five and six on the right rail along with an image, title, and price for multiple different advertisers. Product Listing Ads launched on November 11, 2009 in beta to a select group of retail advertisers and are priced on a CPA basis. Participation requires a Google Merchant Center account and an invitation from Google. You can find details on Google’s Blog here: http://adwords.blogspot.com/2009/11/announcing-product-listing-ads.html

YouTube Promoted Videos. Promoted Videos are CPC-based ads that can be purchased through YouTube or AdWords. I covered these sponsored listings and their impact on brand searches in Search, Video & Your Brand: Hello YouTube. Here is a timeline to its evolution:

• March 9, 2009: YouTube officially names its sponsored ads “Promoted Videos”
• October 2, 2009: Promoted videos are added to AdSense publishers
• October 14, 2009: Promoted videos are available to purchase through AdWords
• October 14, 2009: Promoted videos expand from the USA to Canada, the U.K., France, Italy, Germany, Spain and the Netherlands.

Microsoft Live Search becomes Bing; Bing to power Yahoo search

On July 29, 2009, Bing and Yahoo announced an agreement to work together on search, with Bing controlling technology and Yahoo controlling sales and revenue efforts. This agreement was finalized on December 4, 2009 (though is still subject to regulatory approval). How does this effect your brand? A few quick positives that can come from this for you: (1) Consolidation into one platform means you need only manage ads from one place rather than two, and (2) Bing seems to allow for brand exclusivity. Try the query “ebay auctions” for example on Bing vs. Google.

There are plenty of other interesting events from 2009—please tell me about your favorites in the comments below.

Most brand holders discourage affiliates from direct linking. It can be even worse if a direct linking affiliate’s paid search ads point to dead error-producing web pages.

Why does this happen?

There are several causes of dead links being promoted by affiliates:

• Affiliate removal. You have removed the affiliate from your affiliate program and therefore the link is no longer valid. The affiliate’s ad inadvertently continues to run.
• Affiliate error. The affiliate has made a coding error on its redirect URLs causing the error.
• Cookie stuffing. The affiliate doesn’t care because it’s engaged in cookie stuffing and may not even be your affiliate!

How can you protect your brand?

You need to get those ad taken down—they are damaging your brand by providing a very negative consumer experience, and they are competing with your own ads for placement in the paid search results.

Before doing anything else, you need to identify the affiliate to see if it’s one of yours. There are several methods that you can use to discover the affiliate’s identity. First, identify all of the redirect URLs being used from the paid search ad to your landing page. The redirect URLs will contain the affiliate’s network affiliation, and the affiliate ID.

To do this, you will need to determine the destination URL of the ad and either need to click on the ad (not encouraged), or right click and copy the link location and click later. Next, review the results to determine the affiliate’s identity. If you are using Firefox, I recommend a plug-in called HTTPWatch. This plug-in creates a “recording” of the path from the ad itself through to the ultimate landing page. You may find any of the following scenarios as a result:

• If you get lucky, you will find the affiliate’s URL in plain sight in at least one if not multiple redirects. You can determine the affiliate network by looking at the top level domain, as the ID is usually embedded in the URL.
• If the affiliate URL is not in plain site, but you do find URLs owned by the affiliate, several steps are needed:
  1. So a whois lookup on the domain. Unfortunately, many are likely to be private.
  2. Visit the web site, try to find your ad, then click using HTTPWatch to sniff out the affiliate URL. Sometimes this won’t work because there is no actual web site.
  3. Sometimes the affiliates have their URL’s programmed not to resolve unless the referrer is Google, Yahoo, or Bing. In which case, you will not be able to see the affiliate’s URLs unless you click directly from the ad (again not encouraged), or use a tool like the one provided by Rexswain.
  4. Once you find an affiliate URL, sometimes the affiliate ID will be encrypted. If that is the case, you can either try to decrypt the URL if you have ability to do so, or provide it to the affiliate network and ask for assistance.

At this point, assuming you have uncovered the affiliate’s ID and determined that it is one of yours, your next move is to notify both the affiliate network and the affiliate, requesting the affiliate to take down the ads that contain the dead links. If the affiliate is one of yours, you will get a result using this method.

If that tactic doesn’t work or if the affiliate is not even part of your affiliate program, you need to notify the search engine where the ads are appearing. Ads that point to dead pages violate the editorial policies of Google, Yahoo, and Bing. All three require that ads point to a fully functioning web page. If you report the ad, they will take it down. This process can take a bit of time, and they will require you to provide the following information:

• The keyword where the ad appears
• The ad copy and display URL of the ad
• The link location—which can be obtained by right clicking on the ad and copying the link location.

Finally, just for fun, check the cookies being dropped. If you want to see if the ad is also causing cookie stuffing, just clear out your cookies, and then click to follow the questionable affiliate link(s) that you identified through the first step above. Next open the section of the browser where you can review your cookies and see what was dropped. If there are cookies for other merchants, you have a cookie stuffer using your brand as a pretext to do the stuffing.

Be watchful this holiday season—these tricks are more rampant this time of year, as affiliates are looking to cash in on the big traffic of the season.

Lets take a look at some of the potential glaring brand issues that can exist on yellow page search results:

• Your own resellers and/or affiliates can promote conflicting offers.
• Too many ads for yourself repeating on a page. This leads to consumer confusion about available offers and where to call or which web pages to visit to seek information.
• Competitive ads displaying when your brand is searched.
• Irrelevant ads displaying when your brand or industry vertical is searched.
• National results can display above local results.

Consider these stats published earlier this year:

• Local search comprises nearly 12% of all searches on the top 5 search engines.
• Local search has outpaced the growth of overall web search, growing by 58% in 2008, compared with 21% growth for overall web search.
• Local yellow page sites saw double digit growth in searches last year, with more than a 23% increase.
• 75% of searches are for non–branded terms.
• 45% made a purchase from a yellow pages search.

Now consider a generic category web search on an online yellow pages web site such as yellowpages.com for the generic term “cable TV.” If you are not accustomed to these searches, you would expect to see a similar result to what you might find in a print version of the yellow pages—a single listing of all cable TV vendors, plus advertisements purchased by the vendor. However, the results for “cable TV” contain multiple page elements, which can be somewhat confusing:

• There are nearly 6 listings for each of the major providers—each with a different offer.
• There are nearly 25 ads that appear first, before the consumer ever reaches the actual yellow page phone directory listings.
• There are tiled ads down the right side of the page promoting the reduction of belly flab.

Next, we conducted a search on the generic term ‘Mortgages’ for a local market. These results were similar to the above, plus:

• There were several national advertisers who did not appear to have a local presence.
• Only 1 nationally recognizable bank was advertising on this term—which made me think that the others are not using this channel at all.

Here is what you ought to do to ensure that you get the best exposure on local yellow pages search for your brand:

• Run a search of your top generic terms on the popular yellow page search pages and make note of the results including yellowbook.com, yellowpages.com, and superpages.com .
• Be sure to advertise on your top terms.
• Control your resellers and/or affiliates so that their advertising efforts, ad copy, and offers, are consistent with your own.

Please note that the above issues occur with web based searches. Mobile searches using apps designed for the mobile phone deliver cleaner results and are more in line with what you would expect from print versions of yellow pages.

Consider these keyword examples:

“Desktop computers”. The natural listings are intertwined with three shopping listings. If you want your brand to show in the number one spot, you have to compete with the shopping listings that will appear above you.

“Pizza delivery”. Three natural listings on top, followed by seven map listings. If you are a pizza shop showing 4^th in natural results, you are below the fold.

“Refrigerator deals”. You’ll see a forum with a description and four forum listings intertwined in the SERPs before you even get to the organic listings.

“Ghost”. If you’re looking for a product named with a word with multiple meanings, such as “ghost,” you may find several videos and image listings beating you out.

Just as SEO has finally become a commonplace tactic in the online search marketing mix, we now find that the evolution of the layout of the SERP requires a new approach. As brand marketers, we need to re-think our strategy for how to achieve top visibility for our brand on our major terms on the free SERPs.

I think of this as a new opportunity to be found in a growing class of page elements. Here are four new things that you need to do to accomplish top visibility for your brand using the page elements to your advantage:

Determine your true rank. To determine your true page rank, look at the page layout of the actual page for each of your important keywords—the terms where you need your brand to be identified at the top. Natural ranking reporting tools will not provide you with this information. You will need to study the actual SERP by either running searches by hand or by deploying an organic monitoring tool that offers true page ranking. Identify the order in which your page(s) appear in the overall page ranks. Your page order will be impacted by the other elements that exist on the page. For example, if you are #1 in the natural listings, but there is a map ahead of you with seven listings on it, than you are in position #8 on the page—not #1.

Design a strategy based on the elements that are topping you. Once you identify the page elements that are essentially topping you on a result page, you are ready to develop new strategies. For example:

• If there is a map above you, then you will need to combine a local strategy along with your natural SEO to regain your top position on the page.
• If there are shopping listings ahead of you or surrounding your listings, you may find that you are not in the mix. To gain strength here you will need to determine how the shopping listings achieve top rank on specific phrases, and tailor a comparison shopping engine strategy. Sometimes this can be as simple as a willingness to pay more, or may be more complicated and relevancy or popularity driven.
• If there are video or image listings beating you out, you need to add an image/ video SEO strategy to your game plan. This should include uploading your own brand-oriented videos to YouTube.
• If there are blogs on the page and you are not a major mention, you need to gear up your social media strategy.

Constantly monitor the effectiveness of your strategy. Non-text universal search results sometimes can impact rank faster than traditional SEO. For example, in the case of time-sensitive elements like news or blogs, up-to-date fresh information may beat you out. For this reason, you need to monitor true rankings more often than you do for “regular” SEO. I suggest that you monitor your rankings daily, but if this is too overwhelming, try once a week.

Don’t forget geotargeting. You should engage in this exercise for each of the major markets where you generate leads or sales because the page layout can change depending on the searcher’s market.

With the holiday season upon us, now is the time to engage in this new strategy for your most important keywords—the terms where your brand had better appear on page one of search results.

Ads run on YouTube in much the same way as they do on the text based search engines. On the left side of the screen is “organic” content and on the right is “paid.” You’ll find two types of paid ads on YouTube: “promoted videos” which are ads to generate traffic to videos, and text ads from Google’s content network which generate clicks to web pages.

If you pick any major brand and plug it into the search query box on YouTube, you’ll likely see the “promoted videos” advertisements. You will also notice that the majority of brand owners are simply not yet using this channel—instead non-brand advertisers appear. Here are a few examples:

• WalMart: only non-brand advertisers appear for the terms “walmart” or “wal-mart”
• Best Buy: only non-brand advertisers appear
• Target: Target owns its ad space and only official Target ads appear. Nice job Target!
• Amazon: only non-brand advertisers appear
• McDonald’s: only non-brand advertisers appear.

I could continue, but I think it’s pretty clear that we have a new frontier ahead of us. As with traditional search, you need to deploy a strong brand strategy to promote your messaging above all other advertisers. And just as with Google’s paid search, it’s very easy to advertise using some other brand owner’s name.

Here are a few things that you ought to be doing to solidify your messaging around your own brands on YouTube.

Create rich meta data. This applies to the “organic” side of the YouTube search results. Make sure that the keywords and text that you use to describe your YouTube videos match the keywords on which you want to be ranked within YouTube search results so that consumers can find you.

Become a YouTube advertiser. Just because you’ve loaded videos into YouTube does not mean you will be found or noticed by searchers. You ought to advertise in the same way that you do paid search with the general search engines—to protect your brand. Identify the brand phrases that are most important to you and buy ads that will be triggered by those keywords. You can do this by buying ads on YouTube’s promoted videos product mentioned above. You can add an additional layer of coverage by buying ads on the Google content network and picking “YouTube” as your site selection.

Monitor YouTube search results. Just as you would with paid and organic search on the major search engines, monitor the search results pages of YouTube to see who is listed for your brands and phrases. Take it one step further and watch the videos to see what type of content appears on your brand terms. You may find old commercials, or spoofs of your brand or company.

Monitoring tools for YouTube

Google Alerts. Just as when new content is added to Google’s web index, Google Alerts will send you alerts about new video content on YouTube. However, the alerts are only about new and popular videos, and aren’t limited to YouTube. This information will not be sufficient to tell you who is advertising or appearing in the organic listings on your brand phrases on YouTube. So this is not my favorite method.

Search manually. You can run searches on YouTube.com yourself and hit page refresh a few times to see who shows up on the right and left side of the pages.

Video monitoring tools.. While they’re not here yet, I predict tools will evolve to support video monitoring on YouTube and other popular sites in the not too distant future that will be the next wave in brand protection and monitoring.

Track volume. Track the volume of impressions and click traffic you receive on your brand phrases—this will help you if you have a lot of possible brand variations (e.g. types) to weigh which brand variations merit the effort. Google and YouTube provide reporting and you can also use third party tools to track video ads—and that’s a topic unto itself that I’ll save for another article.

The good news is that the affiliate industry is trending toward recognizing that these issues exist and need to be resolved.  I attended Affiliate Summit East earlier this week in New York.   I was pleased to see two sessions specifically dealing with issues of compliance and regulation of affiliate marketing activities.

Hot topics in marketing compliance and enforcement. This session dealt with the complexities and liabilities of false advertising, affiliate advertising practices and enforcement of the laws and regulations in the USA.  Speakers included a representative from the Federal Trade Commission, a law firm and several industry insiders.

Bullet-proofing your affiliate agreement. This session was conducted by an attorney who explained  the varieties of business rules that are important to lock down in your affiliate agreement in order to protect yourself from liability, enable the merchant to control commission payments when the affiliate is out of compliance and to control affiliate messaging and marketing efforts to stay within the boundaries of the law.

There is also an emerging trend in the industry among the top affiliate networks who either offer or are openly talking about offering network quality services to their largest brand customers.  Some are considering options for their smaller and medium sized customers as well.  Overall, the trend seems to be pointing to a desire to provide merchants with more control over the quality of their affiliate programs.

The good thing is that you are in control when it comes to defining the rules and requirements of your own program.  Without rules in place, you put your ad dollars in jeopardy.  Examples of issues that will confront you in the event of your affiliate quality is out of control:

Increase in CPC If you are battling your affiliates on your key terms, you run the risk of driving up your CPC as you essentially compete against yourself.

Decrease in ROI. When a consumer clicks on your affiliate’s ad they receive a cookie that will give the affiliate credit for any sale that occurs within the cookie expiration time frame (usually 7 or 30 days).  If the consumer also clicks on your PPC ads, and winds up buying something, your affiliate will get credit for the sale—not your marketing department or agency.  When this occurs, affiliate sales can under-value your keywords so that the revenue is lowered, causing an unwarranted appearance of decline in ROI for specific keywords or media properties.

Decline of your good will. In this instance, messaging is key.  Being shown on the same page with competitors, or allowing affiliates to promote old offers, or to make false or grandiose claims will diminish the good will of your brand.

A carefully crafted affiliate legal agreement is important to your success in avoiding channel conflict, to ensure your CPC costs are contained and that your ROI is not falsely deflated.

The Search Monitor tracks and monitors trademark sponsorship and use in ad copy across all of the major search engines for brand holders. We recently conducted a study to determine the impact of these recent trademark policy changes. The results indicate that there has been an increase in trademark use across all of the major search engines.

The study discussed below is a look across several verticals at the change in the number of advertisers who sponsored or used trademarks in ad copy text before the Google June 15^th policy change, and after the June 15^th policy change.

The early results below show an increase in each category, across all search engines. Here is a preview of the current findings by vertical:

A small number of brands were reviewed for the above analysis consisting of brand holders which we suspected are not currently using a trademark monitoring tool and therefore may not be proactively monitoring and pruning abuses.

The above study is just the beginning of ongoing analysis needed to measure the impact on trademark use by unauthorized advertisers, including changes in the number of competitors engaged in the practice, the impact on impressions and/or click share, the impact of affiliate marketers engaged in the practice, and the impact on cost per click.

Does the new policy allow advertisers to engage in unauthorized use?

The short answer is no.

First, Google AdWords, Yahoo Search Marketing, and Microsoft Advertising each have slightly different policies which you can find in their help documentation, and are further explained online by various white papers, bloggers, and columnists. You may be able to sponsor terms freely on one search provider, and not be allowed on another, so check their policies.

Second, the study above shows a big jump in keyword sponsorship of branded terms. This result is interesting because Google did not change its policy with regard to keyword sponsorship. Google has allowed keyword sponsorship for quite some time now. However, the recent policy change which specifically impacted use in ad copy, seems to have encouraged a surge in advertisers sponsoring brands as keywords. Yahoo and Microsoft Advertising did not issue a change, and yet seem to be impacted as well.

Third, just because a search engine allows the practice, does not mean that the law agrees with them. It seems that advertisers think there is an opportunity to use trademarks more freely, which may not be the case from a legal standpoint. The test from a legal standpoint in the USA and abroad is two-fold: (1) is the use considered ‘use in commerce’? To this question, it seems that the concensus legal view is that sponsorship of brand terms or use in ad copy text is a use in commerce; and (2) is the use likely to confuse a reasonable consumer as to the origin of the good or service? To this question, the answer depends on the facts surrounding the use.

For example, if the ad copy or ad leads to a website that looks quite like the brand-holder’s site or has replicated elements such as color, stylization, or logos, then it is more likely to be deemed to be confusing versus a website that has a unique brand and is espousing a competitive comparison.

The key is not to rely on the policy of the search engine but instead to rely on the law of the land in which you engage in business.

Each of the major search providers typically enforces the following rules with regard to the format of display URLs:

• The top level domain of the display URL must match the top level domain of the ultimate landing page (excluding redirections e.g. for tracking URLs).
• The display url can be a sub-domain e.g. ’something.topleveldomain.com’
• The display url can be an indexed page e.g. ‘topleveldomain.com/something

Brand hijackers

In this article,  the term brand hijackers means any advertiser using another advertiser’s trademarks without permission. For example, an advertiser who is not an obvious reseller or company affiliated with the brand holder.

The display URL is an excellent place for brand hijackers (”BrandJacker”) to exploit your brand, as well as the credibility and trust you have built with consumers. Brandjackers will attempt to disguise the display URL  causing its listing to appear to be you. I have noticed the following tricks deployed by brand hijackers in order to divert traffic to their own web pages using your brand as a lure.

Trick #1:  sub-domains

This method is where the brandjacker uses your brand as part of a sub-domain so that at a glance the display URL appears to be yours or endorsed by you. Sub-domains are allowed by all three search providers. The landing page rule is not broken because the top level domain of the display URL and the landing page DO match. There are several techniques used here:

• Brand appears before the ‘dot’. Display URL example:  chuck.99-styles.com

• Brand appears before the ‘dot’ and top level domain is an offer for something free or for a discount or deal.  Display URL examples:

1. fisher-price.now-at-low-prices.com
2. playstation3.price-discounts.com

• Your complete URL appears before the ‘dot’ in the display URL. URL structure example:yourdomain.com.topleveldomain.com

Trick #2: mis-directed display URLs

This method is where the BrandJacker uses your domain as the display URL, so that the ad looks 100% like your ad, but then sends the traffic somewhere totally different.

We find examples of this type with large retailers like Walmart being exploited. Here is a live example, if you run a search for the keyword ‘ walmart‘ or ‘ wal-mart‘, you may find ads that look something like these:

Wa‍lmart – Official Site Your Source for Top Brands & Much More at Wa‍lmart Now! Walmart.com

ShopWal Mart^TM On-Line Save Today At Wal Mart .com Shop Our Official Online Store Now www.walmart.com

The display URLs in the above ads clearly indicate that the advertiser is ‘Walmart’.  A consumer will click on these ads expecting a Walmart web site. That is not what happens. When a consumer clicks on these ads, the consumer may land on a web site that offers one of the following user experiences:

1. A site which collects consumer email addresses. The landing page looks like it belongs to Walmart – it has Walmart colors, logo, and a mocked-up giftcard that looks like a Walmart card. It promises $1,000 for free. To get started, you need to provide your email address.  There is a disclaimer on the web site in small print that tells you the site is not endorsed by Walmart:

“[site name removed] is an independent rewards program and not associated with any of the above listed merchants or brands. The above listed merchants or brands in no way endorse or sponsor [site name removed] ’s offer and are not liable for any alleged or actual claims related to this offer.”

2. Another site which also collects consumer email addresses. The landing page looks like it belongs to Walmart. However, this site is not walmart.com as promised in the ad copy text. The logo and colors match what you would expect, there is a lady jumping across the page holding shopping bags with the Walmart logo on the bags. To get the giveaway you need to provide your email address.

Although the search engines have rules that require the display URL to match the top level domain of the landing page, clearly in the above examples the rule is being skirted. To avoid the rule, the brandjacker may initially point the ad to the matching top level domain site, using a redirect tracking link as the destination URL. Next, as expected the search engine’s editorial bot will crawl the ad to confirm that it complies with its top level domain policy. The brandjacker waits until after the editorial bot has crawled the ad. Once confirmed that the ad has been crawled, the brandjacker switches where the redirect URL points so that now the redirect URL lands traffic on the brandjacker’s web site instead.

What can you do?

If your brand is being used in the display URL without permission, you can complain to the search provider. Most of the trademark policies do not cover the display URL. Your strongest arguments will be editorial rules that guide what can and can’t be used in the display URL. For more ideas on what you can do, The Search Monitor has published a white paper available for download: a Step by Step Guide to Combat Trademark Abuse on Paid Search, which provides a list of ideas to help you to stop these types of tactics.