Brand Bidding

[jess1]

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Ctd from my blog article, the afore talks about Brand Bidding in the USA, this next part is more pertinent to the UK...

...How ever, the merchants featured in this article who allowed affiliates to bid on their brand clearly showed that they were working with their affiliates to not only drive sales but affiliates were partnering to help protect them against their competitors. What was evident was the trust they had for their brand bidding affiliates and saw their affiliates as complimentary rather then as a rival. So it's that simple or is it? I think we ought to dig a little deeper and go under the surface of this escalating debate.

Some affiliates in the UK may have seen on the affiliate terms and conditions, "please don't bid on our name or misspellings or variations" Is this firstly acceptable and secondly is this legal? You may have also seen that some merchants have a closed PPC policy, meaning they are either doing PPC themselves or have opted for a select few ppc affiliates to assist with their campaigns, often this is referred to as a closed group. Paul Wheatley of ShopperUK, One of the most vocal and respected affiliates in the UK argues that in the first instance, that some of the terms and conditions are too ambiguous and vague and in the second instance, if merchants have not registered their variations of misspelled names then perhaps its not a legitimate or fair request to ask affiliates not to bid, in the third instance by merchants having a closed group of affiliates, this can alienate other ppc affiliates. I think Paul's observations are astute and hones right in to the heart of the matter and he goes as far as to suggests there may even be link between the closure of some affiliate programs and their strict PPC policy. Paul Wheatley states, "Let's not forget brand named bidding is a low hanging fruit, but it serves as a good litmus test to ascertain if a merchant is worthy of a PPC affiliates marketing skills for attributing generic & product related terms (which are more expensive) via any EPC from bidding on the brand. If a merchant cannot convert on its own brand, it's highly unlikely it can on generic / product related terms, thus preventing the need for further futile efforts from PPC affiliates." I believe I touched upon the differences between Brand and Brand some time ago. For a few small/medium companies that have just started out, I cant help smiling when I see that they have launched their affiliate program with PPC brand bidding restrictions already in place. Now it could be argued that they are planning for the future, when they become house hold names like Coke, Pepsi, Disney, FCUK to name but a few. Rule of thumb, if no one is searching for your name, you are not a brand. Building brand awareness is a different animal all together

In a candid statement from Justhom.com, he confesses that whilst he has PPC knowledge he prefers to allow affiliates to control this aspect of his marketing, says Adam Davies, MD of JustHom.com (prefers to be referred to as 'pant monkey') "We leave all our search engine PPC campaigns in the capable hands of our affiliates and are happy for them to bid on our company name (as long as they are promoting us of course)..."

PPC brand bidding affiliates vs PPC Agencies
Affiliates take the risk and put their hands into their own pockets.
Agencies take the risk and put their hands into the merchants pocket.

Its in the affiliates interest to work hard for merchants, as they are still paid on a rev share.
Its in the Agencies interest to use up the merchants budget so long as their is an ROI

Affiliates vs in-house PPC
Affiliates manage campaigns effectively and don't require merchants company time.
In-House requires, human resources which is seldom factored into PPC costs.

Its difficult to try and write a balanced article aimed at small to medium sized companies, if you understand how paid search works and you are experts and have the money, knock your selves out and add ppc brand bidding restrictions to your affiliate program, but be confident that you have all those gaps covered. If you have the slightest doubts, Id opt for allowing affiliates to brand bid because in all likelihood they know what search terms people are looking for with regards to yours and your competitors company consumer products or services. As Kieron Donoghue of UKoffer.com points out "Allowing your affiliates to bid on your brand names is a great way to lock out your competitors on the ppc search engines. For example lets say your brand is "Marks & Spencer" and your business is selling*all*sorts of stuff*online (bear with me) then by allowing your affiliates to bid on brand name and generics you can keep your competitors at bay."

Question, do merchants really understand the mechanics of PPC and is it fair for us to laugh at ridiculous restrictions that some merchants impose? To lay the blame at the door of ignorance in this heated arena could be argued but Google's own policy is so vague that I can understand how merchants get all heated, the rules are complex even for the most savvy, here is where I believe some of the problems stem from. Its understanding the mechanics which can lead to misinterpretation and give rise to urban myths. Without excusing some heavy handed ppc restrictive merchants, it is a grey area for some of them. I wonder if its not a question that some merchants feel they need to be seen as being in control, after all they are running a business and you cant admit in public that you simply don't know what you are doing and instead of asking for help and guidance, simply look at the big brands and follow their lead, question... how do you know if they are doing it right?. Ill leave the last word with Adam Davies from Justhom.com, "We do this as it tends to be the power affiliates who use PPC and in general they know the PPC market better than we ever could, so it frees up our time on doing what we do best... selling HOM mens underwear and swimwear" Adam Davies, MD of JustHom.com

Origins of article http://www.affiliateprogramadvice.co...ts-deal_28.htm

[pricethat]

My personal opinion is that there are many affiliates that sometimes "know" or at worst case scenario think that they "know" more than the merchant and so therefore use it as justification that they "must" be the ones that do it or be allowed to do it.

Would it be fair to say that one of the easiest forms of marketing is to brand bid? Money for old rope?

I think there is a place for affiliates to brand bid and to be part of the overall brand protection when the merchant really understands the benefits but i also think that the merchant should not get too carried away with the thought that only affiliates know how to do the job properly.

Affiliates always hate me for saying that, especially the ones that brand bid, and of course we do some brand bidding for some companies as well. But it is hardly rocket science, more a case of the merchant can dig into our pockets as well as their own to extend their online marketing. Interesting read though Jess.

[Keith]

nice little article on the same subject here http://www.revenews.com/bethkirsch/archives/000656.html

this bit jumps out

"...Would you rather have A) your ad and 7 of your competitors' ads on your brand name keyword or B) your ad and 7 of your affiliates' ads on your brand name keyword? A 0% likelihood of losing a sale to a competitor sounds much better than an up to 87.5% chance of losing a sale to a competitor. With Google's new trademark policy, a merchant MUST take this into consideration."

and

The old testing and analysis that led to a policy by many merchants to not allow any affiliates to bid on their brand is out of date and the Alibris example illustrates the need for merchants to reexamined their policies given the ever-changing SERP landscape.

There is not a one size fits all solution for every merchant and merchants must develop a policy that works for their business model, the power of their brand, and the strength of their trademark. And, it's important to remember that reasonable people can disagree on this issue.

[drivetowin]

I think brand name bidding is always going to be contentious -

I certainly agree with Jess about small to medium sized merchants who are trying to protect a brand which simply doesn't exist as a brand, and indeed I have advised a small merchant who will be launching an affiliate scheme soon that they should allow ppc bidding on their brand name and all generic terms - but that advise would be very different if they were an established brand.

One thing I don't think many affiliates recognise is why larger companies or even small companies with a brand that is recognised (and I'd put my own findcheappetrol in that category - it is now a brand, I say the name and people (outside of the affiliate industry) recognise it straight away - so it's a brand in my book) - are so protective of their brand.

The reason for protection is that a) the brand has real tangible market value (money) and b) because you and or your company are instantly associated with the brand it is essential to ensure that you control how that brand is portrayed.

Brand name bidding is easy money and I'm really not sure I buy into the 'keeping your competitors at bay' argument - yes it does if you allow affiliates to bid on 'Widget and company silver widgets' - as opposed to just 'silver widgets' but, providing you have correctly protected your brand with Google in particular, what possible value is there in allowing affiliates to bid on 'Widget and company'

I don't subscribe to the 'allow us to bid on brand name cos if it doesn't convert on that it won't convert on anything' argument either - sorry - that's just an excuse to get merchants to allow brand name bidding for a while so affiliates can make easy money - site performance has far more impact on conversion than being allowed to brand name bid - and also - how does this argument hold water if the brand is not yet an established brand?

While some will argue that not allowing brand name bididng may cause some affiliate programmes to close, I would argue that the converse could be true too - for two reasons a) affiliate sales via brand name bidding are expensive sales for the merchant and so may skew the whole economics of the affiliate programme to make it look unattractive and b) the frankly churlish antics of affiliates who are disallowed from brand name bidding then doing ppc on the brand name anyway and sending traffic to competitive merchants does little to engender goodwill between merchants and affiliates and serves to foster the attitude amongst some merchants that affiliates are amateur marketeers.

Sorry guys, but if we want to be treated professionally, we need to get our own ship in order and act professionally too. No that doesn't mean we should lay waiting for merchants to tickle our tummy, but it does mean we should enter into considered discussion rather than guerilla attacks.

[pav]

Great article Jess.

Certainly raised some good points with regards to building a brand name and blocking out competitors.

I think it all depends on the merchant – For example if a merchant is spending a large budget on radio advertising it is likely that a great number of potential customers will remember the business they heard the radio ad for but forget the website. Therefore, that customer will go to a search engine and conduct a search on the company name. The business who has already created brand awareness via radio, does not then want to pay a further percentage of their marketing budget to an affiliate. Chances are if someone is searching or a brand name they are not going to be interested in its competitors anyway.

As PriceThat mentioned Affiliates often assume they know far more about marketing than the merchant. They may know more about certain aspects of online marketing – but some decisions that are made by merchants are part of a far larger marketing mix, which in my eyes is why sometimes affiliates do not agree with merchants.

As well as depending on the merchant, the points Jess has made also depends on what the merchant is selling. A well known brand name does not always apply to a lot of items sold online. For example, what is the first business that comes come into your head for buying kitchen tiles from? How about a bed frame? LED down lighting?

These relatively expensive items are not something you buy every month, or even year – they are something you will research well before buying. The point I am making is that whilst it is in the best interest for a merchant to look after its affiliates, sometimes a merchant can loose money through an affiliate, even if it is an affiliate that generates large sales volume, because the customer would have found the merchant via other channels anyway.

Some cracking points Jess, however not something that can be applied to all merchants.

[buspassjohn]

As a merchant, my view is simple; if a prospective customer searches for our name they must have heard of it, therefore it has already cost us something to get to that point and is by obviously a brand.
Why should we then pay an affiliate a commission simply to list our name, when numerous entries and links will appear when searching for our name, all of which have already cost us a lot of time and effort.
My view is that affiliates can and should generate new, extra business and I respect and reward those that do, the argument that if they don't bid on your brand name, someone else will direct traffic to your competitors is false.
If Joe (or Jill) public is searching on your name, that's what they are looking for, not others ads for the products you sell, they probably know the names of your competitors as well as you do.

[loquax]

If a company has a brand/trademark they can always prevent anyone bidding on their brand anyway, so the argument that your competitors will be in that space is (or at least should be) null and void if the merchant is aware on what they can do to do this.

Take away brand bidding on a big named broadband service for example and activate trademark prevention and the potential main losers (assuming that the brand is big enough to sit atop SERPS) are the affiliate/agency/network who are enjoying what is essentially money doing the bleeding obvious.

Jason

[a4uforummember]

If a company has a brand/trademark they can always prevent anyone bidding on their brand anyway, so the argument that your competitors will be in that space is (or at least should be) null and void if the merchant is aware on what they can do to do this.

this is the case for single word trademarks but trademark + product on broad phrase matching is an area that merchants should be more aware of and allow affiliates to bid on these. ie. esure is trademarked upon google but esure car insurance will display competitor products. If this mark plus product were opened up to affiliates, this space would be filled more favourably for them.

[Qui Gon Jinn]

There is sometimes a misconceived assumption by a merchant/agent that if a user types in a brand name or hybrid term (brand+generic) that 100% of users will click through on the natural search listing or sponsored ad, when if other alternatives are listed whether a natural search listing or sponsored ad, there is significant leakage to these competitor ads and listings.

Then like radio advertising, there are cases where the affiliate community has assisted in building up the brand via listings, reviews & banners on their sites, though a person may not have purchased, that affiliate has assisted in creating brand awareness without being remunerated... it works both ways.

Then you have some agents who want all the not necessarily just low hanging fruit, but constrict the marketing skills of the affiliate, so that they can look good in their clients eyes. An agencies priority is not their clients interest first & foremost, but their own. Like most invloved in any business, you look after number 1.

[pricethat]

There is sometimes a misconceived assumption that if a user types in a brand name or hybrid term (brand+generic) that 100% of users will click through on the natural search listing or sponsored ad, when if other alternatives are listed whether a natural search listing or sponsored ad, there is significant leakage to these competitor ads and listings.

Not significant enough to warrant paying over the odds for the other 90% of people that are quite capable of navigating their way through to a merchants site without the aid of an affiliate and his ppc ad.

Any leakage statistics that there might be does not take into account the amount of people that might click another ad for a different retailer and then click back because it was not what they was looking for.

[deano6410]

Just on my way to lunch, so will sum up my 2p in one go:

I beleive that if the brand name is trademarked then affiliates should NOT be allowed to bid on that name. If it is not, then merchants should have no say in the matter

[pricethat]

If it is not, then merchants should have no say in the matter

That is right, tell a merchant that they have no right to dictate any part of their affiliate scheme and tell them that all the marketing that they have done before is now worth jack diddly because all of that is going to go to affiliates now

[jess1]

But this is one of the points, surely (playing DA) if the merchant has no TM then any request for affiliates to not bid on their name is Null and Void legally?

[morleymouse]

An agencies priority is not their clients interest first & foremost, but their own. Like most invloved in any business, you look after number 1.

Exactly. An affiliate who is allowed, or even if there not allowed that bids on a brand name could, and would do just that. Everyone is out to look after themselves, theres someone bidding on "alpha rooms" now, but I dont see their ad on "barcelona hotels" or anything generic - there out to make a quick buck.

Some agencies might just burn money for the sake of shifting the budget, but I know some that have to work to a cost of sale, or cost of aquisition. So they are under the same sort of pressure that affiliates are - but they have to compete on more competative terms and make them work. So the great conversion on brand terms is brought down by the more expensive generic stuff.

Any affiliate, again looking out for themselves is going to be continually optimising PPC campaignes. Weighing up whats working, what isnt, what sort of ROI compared to volume etc etc. If I had "alpha rooms" converting sh#t hot and "barcelona hotels" making a small loss, as an affiliate its not in my interest at all to continue the one thats making a loss. For an agency this is different, they are acting for the company.

I beleive that if the brand name is trademarked then affiliates should NOT be allowed to bid on that name. If it is not, then merchants should have no say in the matter

Deano, some of your posts are pretty good, but ill just take it your too hungry and must have made a mistake?

If its trademarked and registered with google affiliates cant, even if they want to. And even if it isnt then of course a merchant has a say, I thought affiliate marketting was about working together, a partnership not just affiliates going rouge!

[Qui Gon Jinn]

I am currently formulating the structure to a white paper starting with the exact clarification required from networks / merchants which MUST be included in a program t&c's, as one of the main problems seems to be the lack of a single point of reference on a given network & ambiguity, which can lead to an openess in the interpretation.

Several networks, I feel fail on the above point as depending where you look on the affiliate login area, they are often different. One network counter claim with their Code of Conduct, which is fairly lop-sided & requests we have made or errors pointed out over a period of months have not been addressed in their admin area.

I am also tackling these blanket restrictions, where it says restrictions along the lines of "any variation or misspelling". Most only say that because they don't know them all, as well as the fact they don't actually own the marks to these. This is a grey area which should be addressed.

If a program has a closed group, this should also be mentioned in program details, as some may mistakenly think "if he's/she's doing it, then I am doing it". There are advantages & disadvantages to closed groups. Like a supposed element of control from a merchant / network perspective & that these affiliates will if finding a decent EPC will attribute a significant portion of generic & product related terms at the program. Unfortunately as just one disadvantage, many of the big boys who do a lot of sucking up / brown nosing to merchants / networks do not contribute much further & just sit on brand. Another disadvantage is PPC'ers outside the closed group will be alienated & offer these generic terms to another merchant or multiple merchants (thus there could be several ads from one affiliate competing against the single closed group ad (if linking direct to merchant). Also these excluded affiliates can easily bid on the generic element of a hybrid term & ad will appear for the hybrid .. this is perfectly legit for broadmatching. If an excluded affiliate wanted to take it one stage further, which maybe a slightly grey area, they could bid on the variations & misspellings (NEVER the exact brand) & send to a competitor, especially if the merchant doesn't own marks to those mis-spellings or variations.

Thus any merchant really only have themselves to blame if they don't register all their marks with Google Adwords or appropiate PPC search engine.

Merchants fail to think about hybrid terms (brand plus generic), affiliates as a group will tend to cover nearly all of these.

Let's not forget brand named bidding is a low hanging fruit, but it serves as a good litmus test to ascertain if a merchant is worthy of a PPC affiliates marketing skills for attributing generic & product related terms (which are more expensive) via any EPC from bidding on the brand. If a merchant cannot convert on its own brand, it's highly unlikely it can on generic / product related terms, thus preventing the need for further futile efforts from PPC affiliates. If a restriction is in place from out-set then why should a PPC affiliate put their OWN money / budget as risk to find out otherwise. Therefore in most circumstances these merchants have immediately lost out on FREE advertising spend (and only rewarded on a cpa) whereby a number of PPC affiliates spend millions of £'s individually each year.... However most merchants do not convert adequately on their own brand. One thing to note though is lesser known brands who are looking to build up their presence online, generic & product related terms need to be thrown at these to ascertain EPC as traffic volumes on brand alone won't be significant enough. Though these smaller brands which incorporate a restrictive keyword policy at out-set or shortly into their program life will not stand a chance of a successful program.

PPC Search Engines as we all know is a quick fix to driving quality traffic to a merchant, it's part & parcel of affiliate marketing, (though some purists dislike how PPC is dominating the industry away from traditional SEO (which mustn't be neglected). But my point is, I am noticing more programs closing nowadays rather than launching, and proportionally more of these programs which are closing are those with restrictive or draconian PPC policies. There might be something in there.

The next thing I would like to jointly work on is a "book of rebuttal" asking every merchant with a restriction why they have one & counter with a few questions & counter again, which can be used as a point of reference.

There is also the philosophy of whether the brand term or the generic term is the biggest. Personally I believe the generic term is bigger than the merchant brand when it comes to search engine marketing, whether SEO or PPC. In PPC, generic terms are more expensive & it's more competitive too. PPC affiliates will be shrewd on who enjoys the benefit of these generic / product related terms. Bidding on brand is simply a trade off for the merchant to receive a bigger slice of pie from the PPC affiliates ad spend & skills, merchants may want to start offering this an appetizer or lure for the big spenders. In theory brand / hybrid named bidding should maybe only subsidise the larger marketing activity of the PPC affiliate.

Basically merchants placing obstacles in PPC affiliates way, without well thought out reasoning, are missing out on potentially MASSIVE opportunities with their affiliate program & constricting it's growth.

But one of the main problems to finish on for time being, is that many networks are too yellow bellied with merchants / agencies & simply say yes or offer little resolve to any keyword policy / PPC restriction in fear of losing that merchant to another network who is even more of a nodding dog.

Just one questions though: what is the difference between SEO (whether deliberate or not) & PPC SEM apart from the element of cost .. & why is PPC SEM getting so much attention???

Restrictions on brand named bidding on marks ACTUALLY owned, I can quite happily take it or leave it depending on the merchants rightful perogative even if not thought out by the merchant/agent. It's hybrids & generics where much conflict of view materialises.

The words DICTATE was used in an above post, there is too much dictating & emails saying with immediate effect etc ... If affiliates made these same demands with IMMEDIATE EFFECT, hardly any network or merchant or agent would oblige. All very one sided.