Google’s Change in Trademark Policy

Google recently announced a change in their policy about using trademarks in AdWord campaign text ads. It’s an interesting change – and will be valuable for companies that sell parts, accessories, for franchisees and for affiliates. However, it puts brand holders in a potentially precarious position.

Here is the pertinent information I pulled from Google’s policy statement:

As a provider of space for advertisements, please note that Google is not in a position to arbitrate trademark disputes between the advertisers and trademark owners. As stated in our Terms and Conditions, the advertisers themselves are responsible for the keywords and ad content that they choose to use. Accordingly, we encourage trademark owners to resolve their disputes directly with the advertisers, particularly because the advertisers may have similar advertisements on other sites.

As a courtesy to trademark owners, however, we are willing to perform a limited investigation of reasonable complaints about use of trademarks in ads. In the US, our policy permits use of the trademark in the ad text in the following circumstances:

  • Ads which use the term in a descriptive or generic way, and not in reference to the trademark owner or the goods or services corresponding to the trademark term.
  • Ads which use the trademark in a nominative manner to refer to the trademark or its owner, specifically:
  •  
    • Resale of the trademarked goods or services: The advertiser’s site must sell (or clearly facilitate the sale of) the goods or services corresponding to a trademark term. The landing page of the ad must clearly demonstrate that a user is able to purchase the goods or services corresponding to a trademark from the advertiser.
    • Sale of components, replacement parts or compatible products corresponding to a trademark: The advertiser’s site must sell (or clearly facilitate the sale of) the components, replacement parts or compatible products relating to the goods or services of the trademark. The advertiser’s landing page must clearly demonstrate that a user is able to purchase the components, parts or compatible products corresponding to the trademark term from the advertiser.
    • Informational sites: The primary purpose of the advertiser’s site must be to provide non-competitive and informative details about the goods or services corresponding to the trademark term. Additionally, the advertiser may not sell or facilitate the sale of the goods or services of a competitor of the trademark owner.

 

How I read this policy change is that they are allowing companies that offer compatible products to use brand terms, so “discount Toyota parts” or “iPod accessories” can now be used. Also, affiliates can use brand terms, so “Best deals on XYZ product.” I can see a lot of affiliates that base their model on “coupons” will use the heck out of this approach.

Here’s where it can get really hinky for brand owners:

Affiliate ad showing in a brand placement – since it has an offer, discount statement AND the brand phrase, a searcher is more likely to click on that ad rather than the brand holder’s ad.

Google requires that an affiliate have a landing page or something equivalent – which gives the affiliate carte blanche with user experience. If they are good at closing sales, then the searcher will buy from them. The brand owner sees the effectiveness of their paid campaigns diminish, they are paying out more in affiliate fees, and (to add insult to injury) the affiliate starts getting lower AdWord fees because they are getting the clicks – so the brand owner loses positioning on their own phrases.

I do not wish any ill-will on affiliates – they are a great source of revenue for any company. However, they start affecting brand-based search campaigns, which are usually where brand owners close the sales that they have fostered through more expensive, broader phrases.

Additionally, there are ways for companies to get around the requirement regarding not advertising with competitors’ brand phrases in the ads – especially with the “informational site” clause. However, I think this is downright unethical.

It will be interesting to see what happens in the longer run with the change in this policy – and whether we will see an update soon from Google about how this is handled.

Quick addendum – Did you know that Google does not pursue trademark violations when they appear in the visible URL of the ad? Keep your eyes open because your competitors CAN get around Google’s trademark policy by using your product / brand name in their visible URL. You’ll have to reach out directly to the competitor about that one.