Bidding on competitor-based keywords is controversial to say the least. Some SEM account managers do not approve of this; however, this tactic can deliver results if implemented correctly.
Let us look at what needs to be done when using this tactic
Why do it?
There are primarily two reasons why you should consider this tactic
Low cost
As there is less or almost no competition for brand terms of competitors on search engine results page this tactic is cost effective. You pay far less costs per click and do not face as much competition. Secondly since there are few advertisers bidding for competitor’s brand terms your ad is likely to stand out and get more clicks at lower costs.
Increased visibility and consideration for your brand
Since your brand is going to be showcased next to your competitor, your brand will get increased visibility. Those that are unaware of your brand will get a chance to see your product/brand and there is a likelihood of them considering your product over your competitors. Another important point you need to keep in mind is that if your competitor happens to be a top brand then being next to it gives you a certain degree of respectability. This is a positive impact for which you don’t have to pay too much.
High Quality Traffic
The traffic you get is going to be of a higher order. As anyone that visits the competitor’s site usually does it through branded search. And the clicks you get from such visitors give you an opportunity to seal the deal. Secondly, those that want to visit specific pages of your competitor’s site like customer service are unlikely to click your link. In this way you avoid unqualified traffic, thus saving some money.
Now let us discuss some tactics that you have to keep in mind when using this strategy
Sooner or later others are going to notice what you are up to and will begin to bid on your brand terms. In such a case don’t complain. However, if you are bidding on extended brand terms you will still be able to fool them.
Having said all this there is still a chance that this will not work. Bidding on competitor brand terms does not necessarily work with all accounts. Weigh in the pros and cons before going ahead. However, if done properly there are dividends to reap.
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