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Comment by tempestn | Hacker News Reader

We've found exactly the same thing. It's extremely important to differentiate between branded and non-branded keywords. (And to be diligent about filtering out all variations, misspellings, etc., of branded searches from non-branded campaigns.) While our testing didn't show 100% waste in branded advertising, we did find approximately 80-90% of branded clicks would otherwise have come through organically. So we do still do a small amount of branded search advertising, but with an assumed actual CPC of 10x the nominal CPC (and therefore quite a low maximum bid). For non-branded ads, we assume the true CPC is much closer to the apparent one.

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The branded keyword game is very sneaky, though, and one place where google can (and does) make a killing.

The trick is, if you have a particularly strong or unique brand, you can count on being the number one organic result. HOWEVER, if competitors bid on your brand and you do not, they end up above your brand in results as part of the the paid/promoted position.

This usually forces brands into competing in paid positions on branded keywords that they should "win" naturally. Google rationalizes this by charging more relevant results a lower rate, but it still doesn't excuse the fact that the brand shouldn't have had to pay in the first place.

i wonder if competitors bidding on your brand should be construed as trade mark violations - after all, if a user searches a brand and a competitor's site or product is shown as part of advertising, then aren't they making use of your brand to confuse the consumer (a classic trade mark violation)? The only problem is that the user isn't "seeing" the brand and confusing it, but instead is searching the brand and the search result is confusing deliberately.

Is it actually confusing anyone? If I search for Pepsi and some of the ads are for Coke or Dr Pepper, that seems fine to me. If it's counterfeit Pepsi or something that's clearly a different case, but if someone searches "ebay mittens" I don't think it's ridiculous to allow a mitten store to have an ad that says "we sell mittens too!".

It definitely confuses our customers. We fairly regularly receive unpleasant tickets asking where their order is. Once we dig in we often find they did not order with us, but with a competitor who they thought was us.

The worse I've seen has been malicious malware spreading with an exact copy of the company site. There's also morally/legally dubious combative advertising eg: "Better than X" when searching for X.

Best part of course is that Google has been constantly making it less clear whether something is an ad, so the tricking is really primarily done by Google themselves. The advertising is really just paying to be the first search result.

That's an interesting idea. I'd certainly like to see that case made.

This was shared in another comment in the thread: https://veritasbusinesslaw.com/trademark-and-google-adwords/

> Google has been sued frequently for trademark infringement because it allows advertisers to purchase trademarked names for use in AdWords by competitors.

> Google has never lost one of these cases.

> Google derives 97% of its revenue from advertising, annual revenue that was over $109 billion as of 2017.

> These conflicts illustrate a serious problem with how internet advertising is conducted.

"> Google has never lost one of these cases."

Perhaps they settled every single case. Show us one that went to trial.

Not a chance. Google is trying to match search intent and so are ads. If the ads are relevant to what's being searched, then it receives a low quality score and isn't shown often, if at all depending on how irrelevant it is. If I am a lawn mowing company, I can't just show my ads whenever someone tries to lookup apple because they're a popular company.

So far we haven't found the presence of ads above our organic result seems to make a big difference, but I expect that could vary a lot based on the brand and what competitors are advertising. Probably a good idea for anyone planning to spend significant ad dollars to test for themselves.

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