Don't be surprised on March 4 when your Search Alliance (Microsoft Bing and Yahoo Search) campaigns are suddenly less profitable. Recently, the Alliance announced that, effective March 3, they "will no longer investigate complaints about trademarks used as keywords" for U.S. and Canadian accounts. In effect, this allows any advertiser to bid on any trademark term regardless of their relationship to the trademark owner. Microsoft is not altering the current policy for trademarks in ad copy, so only trademark owners/resellers are allowed to utilize trademark terms in ad copy, except in certain circumstances.
This trademark policy change essentially mimics the Google trademark policy update instituted in June 2009. Across our landscape of advertisers, this policy change resulted in an average client seeing a 12.9% increase in brand CPCs over the month immediately following the change. Basic economics argues that more bidders result in higher prices, so this result was not unexpected and measured impacts varied by client and industry. This policy differential, up until now, has resulted in Ya!Bing brand CPCs being on average 28.9% less expensive than Google brand CPCs.
Given this change, our best guess is that the brand keywords CPC differential between Google and Ya!Bing is going to be eliminated or potentially reversed. We base this on evidence from the previous Google change, as well as specific mechanisms in the Ya!Bing auction market. Your brand keywords will probably continue to show high click-through rates (CTRs), while your competitors will show much lower CTRs; but unfortunately, the Ya!Bing auction mechanism will mean that your CPC for these terms will be higher than before.
As marketers, there are a number of steps you can take to mitigate these anticipated effects:
1. Examine your brand campaigns and bids on Ya!Bing. Many Ya!Bing brand campaigns, due to the lack of competition, have experienced atrophy and neglect. Make sure that you are following all of the best practices for brand campaigns. Raise bids where appropriate to ensure that your brand is prominent for your keywords and that you are not caught by surprise. Your brand campaigns should still relatively outperform, just not at the same level of profitability. Given the anticipated rise in CPCs, make sure that budget caps are properly set. Adjust your negative keywording and match typing strategy within the brand campaigns to ensure that you are not overly broad on your query matching. Enhance your coverage on brand terms with keyword buildouts. Finally, make sure that your trademark terms are prominently displayed in your brand campaign creatives to capitalize on your one source of competitive advantage.
2. Reassess your brand strength and competitor bidding strategy. Bidding on competitor keywords can be a profitable strategy and result in incremental volume to your Ya!Bing account, especially if your brand is significantly stronger than your competitor. Where applicable, develop competitor campaigns and adjust negative keywording strategies to other non-brand campaigns.
Microsoft's policy change is a reaction to the competitive advantage that Google enjoyed over Ya!Bing for the last 2 years. Ultimately, its effect on your campaigns is inevitable, but can be mitigated.