October 29, 2021

Google Ads-bidding on your own brand name: Pros and Cons

Dr Peter Mowforth

The Conundrum

One of the most common questions we get asked involving paid marketing is whether you should or shouldn’t spend money on Google Ads for your own brand name.

On the one hand you might be paying twice for being top of the search engine listings. Alternatively, this could be a smart strategy to gain more business and grow your brand. Here we explore the pros and cons to help you decide what’s best for your business.

With a well chosen domain name and decent marketing your website should reasonably expect to be top of the search engine listings for anyone typing your brand. There are some clear exceptions. If you own insurance.com then you wouldn’t expect to be No.1 for everyone typing ‘insurance’ into Google. The reason is around buying intent. Anyone typing 'insurance' is likely to want insurance and there are other brands more likely to offer what a potential customer is looking for. The great advantage of a Google Ad is that you have the potential to buy your way to the top of the listings. The conundrum is whether you should spend money doing this when you are already No.1 organically?

The Cons

When we’re asked to review an ecommerce business we often find that there is an Ads Agency that is using budget to buy the brand name and to ensure that it is in top position on the page. If the business is already top of the listings then the company is first … twice. If people then just click the first link, the business is paying for something that they would have got anyway for free. You might reasonably call it ‘SEO cannibalism’. The agency will be able to generate much more traffic using this technique. If they are paid on this basis of how much traffic they generate then the agency gains money while the ecommerce business spends more budget for no, or little, effect.

The Pros

There can be good reasons for shelling out marketing cash by bidding on your own brand name. Reasons include:

  1. Your website is not No.1 on search engine listings for your brand.
  2. You want to use the Google Ad to divert traffic to a particular landing page on your website.
  3. It’s necessary to communicate additional information that’s not listed in the organic result. This might be a particular promotion or call-to-action.
  4. Defend against others hijacking your brand. While it is legal for competitors to do this, it has to be done in a way that isn’t misleading a customer by passing-off. If a competitor is trying to steal your brand traffic by misleading a user then you can complain here. Having a Registered Trademark for your brand is a major benefit when defending the use of your brand.

The Analysis

A general rule-of-thumb is that branded keyword searches are usually less expensive than generic keywords. Hence, the branded Google Ad may not be costing too much. If branding and brand exposure is important then it may well be possible to justify what is effectively a double listing.

Ecommerce is a hugely pragmatic subject where opinions count for little and truths are always there to be found in the data. If a third party agency is using your budget to bid on your brand name then you should be doing a careful analysis to work out the value to your business. When doing this, the key questions you need to ask are:

  1. Are there better ways to spend paid advertising money that result in more profitable sales for your business.
  2. Exactly what benefits accrue to the agency for these branded ads.
  3. Exactly what benefit is being gained in terms of your online sales by the SERPS double entry.

To help gain answers you could experiment by pausing the ads and analysing the results. The other tell tale evidence is to look within your Google Analytics and clarify exactly how much of the paid-for traffic is based on searches that involve your brand. The higher the percentage of this branded traffic the more you might question why your budget is being used in this way.

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