Rob Laver
Rob Laver Senior PPC Manager

Is it worth bidding on your competitors?

Rob Laver
Rob Laver Senior PPC Manager

Achieving high rankings in Google SERPs is an art that comprises tactics, strategic planning and – in many cases – patient determination. However, while SEO is all about the long game, PPC allows you to create quick wins, directly targeting your audience and delivering a tangible uplift in conversions almost immediately. 

There are many types of PPC advertising to consider, depending on the nature of your business, the type of customer you are trying to target and the level of competition in your industry. This is where the expertise of a dedicated PPC team comes in useful – advising you on which methods are the most strategically rewarding, rather than simply delivering the fastest turnaround.

One PPC tactic which tends to split opinion is bidding on competitors’ branded search terms. Although these types of bids have been permissible by Google for well over a decade as long as trademarks are not infringed upon, the benefits are still in dispute. While bidding on competitors can undoubtedly bring quick benefits, it’s been known to cause problems in the longer term too. 

Why should you bid on competitors’ search terms?

As targeted advertising goes, aiming for customers who are actively searching for your competitor seems like a safe bet. After all, if they’re interested in what your competitor is offering then they’re also interested in what you’re offering – they just don’t happen to know it yet.

While people searching for your competitor by name are likely to be close to the bottom of the conversion funnel, there’s no reason they can’t be tempted away from the brand they’ve chosen if you’ve got an offering that’s compelling enough. Taking customers from under the nose of the competition is a tactic as old as retail itself, but there are other key benefits to bidding on competitor search terms:

  • High brand exposure. Targeting specific branded search terms puts your website squarely in the orbit of customers who are likely to be interested in it. Such highly relevant brand exposure isn’t always easy to find.
  • Potential for high-quality traffic. You may not see a huge upsurge in clicks as a result of bidding, but the traffic that does find its way to your site will generally be relevant with high purchase intent, making conversion relatively straightforward. However, there are always users who click ads without reading them properly, so a steady bounce rate is always part of the equation.
  • Live data on competitor brand searches. You can get rough estimates of search volumes for competitor terms, but the only way to know their true market share is to bid on them. This also gives you data on the devices people use, where they search from and the time of day or week they search – which all helps to build a picture of where there may be gaps in the market.
  • Be associated with authoritative voices in the market. Users don’t know the ins and outs of how competitor bidding works, and will likely assume that you wouldn’t be able to appear alongside a trusted brand without stringent verification. This means the next time they see your brand, you are trustworthy by association.

Things to consider before bidding on competitor search terms

It’s important to ensure that you’re bidding for the right reasons. Pursuing a bit of old-fashioned competition against a brand because they take a share of your customers may seem logical, but there are a number of pitfalls that competitor bidding can bring. 

  • Could it bring you a low Quality Score? Especially with aggressive bidding, it’s possible that your ad won’t be relevant to a high proportion of the users who see it. Google may penalise your site for this with a low Quality Score, and a higher cost per click as a result.
  • Does your competitor have sufficient traffic volume to justify bidding? Using a competitive analysis tool, you can view search and click volume for each of your competitor’s branded terms. What do you stand to lose? If they get hundreds more searches per month than you do, then it may be worth bidding, and the bidding won’t bother them too much. If the figures are broadly comparable, then it’s not worth getting into a bidding war.
  • How is competitive bidding viewed in your industry? There’s no industry in which competitors will thank you for muscling in on their digital territory, but in many it’s an accepted part of healthy competition. However, in others, such as the charity sector, there are ethical considerations. If you’re in any doubt, check whether anyone else is bidding on your competitor’s terms first.

Best practice when bidding on competitor search terms

If you’ve decided that bidding on your competitors’ search terms is a worthwhile pursuit for your business, then there are a number of things to remember in the process that will help bring the best results.

  • Make your ad copy stand out. The customers you’re trying to capture are already seriously considering your competitor, so they’re going to take some persuading. Decide on the USP that makes you better than your competitor – whether it’s price, convenience, property or something else – and place it front and centre. 
  • Don’t always push it too far. Bidding on your competitors is not necessarily about knocking them off the top spot on an SERP. Think about how much you’d ordinarily be willing to spend per click, and whether appearing alongside your competitor is enough if you’ve got a strong proposition.
  • Avoid including the competitor’s keyword in your ad. This will not only keep you on the right side of Google’s trademark infringement rules, but prevents it from being misleading or irritating to potential customers.
  • Be clear on your objective from the start and monitor closely. As with any marketing campaign, if you’re not hitting your desired return on investment, then you need to be prepared to pull the plug.
  • Don’t get into a bidding war. Your competitors’ AdRank for their own terms is bound to be better than yours, so the repercussions of bidding disproportionately will be greater for your business. Always bid within your means and don’t focus on trying to damage a competitor.

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