Tesco vows not to place Google keyword bids on rivals' trademarks

by Ed Kemp, Marketing 29-Apr-08, 08:45

LONDON - Tesco has become the first major UK advertiser to take a stand against Google's decision to allow brand owners to bid against each other for keywords trademarked by rivals.

The UK's biggest supermarket chain has signalled its intention to take the 'moral high-ground', stating that it will not attempt to bid on search terms relating to its competitors.

Tesco, which spends £2.2m a year on online ads, is hoping other UK brand owners will follow suit, preventing the cost of paid-search ads rocketing.

From 5 May, consumers using Google to hunt for specific brands will, for the first time, receive sponsored listings for rivals. The latest rules are expected to force the UK's biggest online advertisers into conflict.

Earlier this month, a range of high-profile brands including Diageo, Mercedes-Benz and O2 told Marketing that they plan to review their paid-search strategy in light of the changes to Google's policy.

The changes are likely to result in a rise in the price of branded paid-search listings. Advertisers have traditionally been able to buy trademarked keywords at a low cost, enabling them to generate significant profits from their sponsored search activity.

Comments

Wise Words - 29/04/2008

good on them, if all brands took the same stance it would be great.

Giles Robertson - 29/04/2008

Really good news - not the way Google hoped it would play out.

Ed Kemp - 29/04/2008

A positive move from them for sure. Will be interesting to see who follows suit now.

Michelle Roe - 29/04/2008

I suppose it goes back to the old, "whose got the better ad" to determine positioning, rather than whose got the best lawyers. Web 2 is about freedom, dialogue, and not corporate control. Search is a media, and when you think about it, comparison is one of the key elements that people look for when using the web. They want that to be easy and free of corporate control, and lets face it, bidding on competitors keywords “is not illegal”, I am not advocating a lawless web, but one driven from the needs and requirements of the users.

Mike Page - 29/04/2008

Let's not forget that there are brand names out there that have become or are becoming generics. People still talk about Hoovers rather than vacuum cleaners, Lycra rather than fitness clothes or 'comfort stretch', iPods rather than music players. The list could go on. And then you add into the mix brand names that are also place names - Halifax, Cheltenham & Gloucester etc etc. And with these 2 examples add in the confusion that probably 99.999% of the population still refer to them as building societies... There have been ways around bidding on brand names in the past, as I'm sure many fin servs brand owners will testify. How would you have stopped a Halifax (place not bank) mortgage broker bidding on Halifax mortgages...? While some may kick up a fuss about what Google is now doing, all they did before, IMHO, was like 'non competitive' sports days in school. Hmmm. Welcome to the world of competition

Tim Mannveille - 30/04/2008

Hah! Very clever. As the market leader (in both sales and search) Tesco had the least to gain and most to lose from the new rules, making the 'moral high ground' the most strategic move they could make, all ethics aside.