StatCave Episode 4: Competitors & Trademarks!

AdWords is a naturally competitive environment so, should you be bidding on your competitor's trademarks? Some people think that you're not allowed to bid on your competitor's trademarks and that pretty much isn't true. You're not allowed to use their trademark in an ad, but as far as keywords go it's way more of an open field. It's a perfectly natural instinct for a competitive retailer to want to go attack their enemies on their own territory. That's one way you might be able to capture more market share, right? Well, the problem is that laying siege to your enemy's castle has many of the same downsides that sieging an actual castle has. Namely, they have defenses. In their case it's in the form of relevancy. The fact that their brand is on their site and highly relevant to their site means their quality score is going to be fantastic. You might not have their name anywhere on your landing page and therefore your quality score is going to abysmal and right out of the gates are going to be at a significant bidding disadvantage on those keywords if you're able to show up at all.

But let's even set that aside for a moment and assume that you were able to get past that CPC disadvantage say through being willing to take a loss or something like that which is almost never a good idea. You're still not out of the woods. The problem is that those people are looking for that competitor's website. That is the most relevant search for them and so therefore your bounce rate is probably going to be terrible because they're going to land on the page, go "Ugh. This isn't what I had in mind," and bounce back. If they don't, they're still probably not going to convert because you still aren't what they were looking for. Remember ad words is best deployed when you're trying to match the shopping intent with your offering, but their shopping intent doesn't line up with what you're offering. You're offering a totally different site and so your relevancy, not just to ad words in terms of your quality score, but your relevancy to the shopper is low and bad and it's going to result in an abysmal conversion rate. You're going to be losing money pretty quickly. 

Now, this is a great point to jump to a related topic which is what to do when the enemies come to your castle walls. So if your competitors are bidding on your trademark terms, what do you do? The fact is that your castle has all of the same defenses that their castle has so advantage you in this case. There are two types of instances where this will come up. One, large retailers like Amazon who just cast wide nets across the shopping space and the classic example of this was Ebay a few years back. We all saw tens of thousands of those looking for any key word here, find it now on Ebay. Amazon's doing the same kind of thing. It's more sophisticated, so it doesn't suck quite as bad, but it's still pretty garbage and so their relevancy isn't going to be outstanding, they're just going to be an always present also ran if they show up at all. And they don't generally try and go after your trademark so unless you're trademark is a fairly generic term that is descriptive of the products and your retailer then they're probably not going to go after you. 

The other type of competitor that'll show up in this kind of combat is a direct similar kind of weight class competitor, so if there's another online retailer that's selling a similar catalog to, they might try and chip away at your castle walls thinking that they're going to cleverly capture your market share. Now, just as we were talking about this is a bad idea for you to attack their castle, same thing here. You can deploy, you know, hot oil and throw rocks at them from on top the walls and it'll be hilarious. They will however have to stop at some point. Just like an actual siege once again. The limitation is how many resources can be deployed on either side of the wall and you have the advantage of the better conversion rate, the lower cost per click, and they're running up against some kind of finite budget. They can only throw so many dollar bills at your wall before they realize this isn't making us money. Now if I'm wrong about that, that's actually good news because then your competitor is losing money left and right and isn't that just the best? I am a fan of letting my competition lose money. 

There is exactly one, count them, one use case where I think it makes sense to go after a competitor's trademark terms and that is if you are a considerable underdog. The example I want to share with you is actually someone from my own experience as a retailer. Before I worked at Leslie's Pool supplies where I was VP of digital marketing obviously, I was CMO at Pool Supply World, a much smaller company online peer play retailer which was eventually acquired and that's why I ended up at Leslie's, but when I was at PSW and before the acquisition, Leslie's was my biggest enemy. They were the only national brick and mortar chain. They had the largest online presence and so if I wanted to try and chip away at their dominance, I had to go for the jugular and I could do something that you shouldn't do if you're not a significant underdog. I created a direct comparison landing page showing, here's what Pool Supply World can offer and here's what the competitor target can offer and this makes sense if you are the underdog because people recognize the big brand and they don't recognize your brand and so that comparison is saying, okay well you know how legitimate this looks, well we are just as legitimate and here are these other advantages. 

You know, you take the similarities to draw legitimacy and then you use the differences to sell your superiority. If you are, you know, a major player in your market already, this can undermine your brand because by ... If you were the big dog and you're recognizing all of the little ones that are nipping at your heels, you're actually increasing their exposure, but if you're the little guy, there's a potential way to go after it and that is making sure that the landing page has a chance, any chance at all at having a decent quality score and that has to be going directly after the name of your competitor which is a trademark tactic. But please, once again, only if you're the underdog. 

So, if we're not gonna go after their trademark terms, how do we make a competitor sweat? My favorite trick is to go after their organics. If they are getting a significant portion of traffic for an organic search result, they are not paying for that which means it's more margin rich for them and your ads would show up higher on the search results page than their organic listings. So you get this dual benefit of gaining the sale potentially but also stealing some of their most margin rich revenue, a good combination if you can reproduce it. While there are tools like SEO Martian Spy Fu which are just two that I've used, I'm sure there are plenty more that help you with key word research, when it comes to this kind of strategy, it's not nearly as difficult or sophisticated as some things that you've seen maybe from SEO experts. For our purposes, all we need to know is what does this site think that is their primary category or categories, what do they think they're strong at and their navigation, their site layout, their merchandising, their email program are all just gonna tell you that because they're trying to tell the customers the same thing. You don't need access to your enemy's ad words accounts to know where they're probably investing the most attention because it's gonna map pretty closely to where they're probably investing the attention on their site and other marketing channels. 

Alright. That's it. Basically my advice is, don't bid on your competitor's terms unless you're the underdog and have a landing page where you can have some quality scores. If your enemies are coming at you, let them. They're going to lose and then if you do want to counter punch, go after their organic listings. So the last thing I wanted to mention is I happen to be wearing my Feedonomics shirt actually today. They're a partner of ours that do fantastic feed management work and they are co-sponsoring StatBid Summit on February 26th, the day before Etell West in Palm Springs. We are throwing a massive, well massively important, but small venue, small group event with PechaKucha style presentation, so we've held maybe a half dozen of these in the past where the presentation format is auto advancing slides every 20 seconds and there's only 20 slides each, so each presenter only has about six minutes, so nobody is bothering to check their phones during each presentation. They're fantastically fun to watch, action packed, full of amazing details and then the Q & A is just out of this world, so I can't wait. I hope to see you there and, because you're watching this video, I'll provide you with this discount code which'll get you in for free. Anyway, it should be a blast and I hope to see you there.