May 2008
Google's policy change on ad words: threat or opportunity?
Google’s controversial policy of using registered trade marks to trigger sponsored links has just got more controversial. However it may not be all doom and gloom for trade marks
owners.
As from 5th May Google will allow you to bid for the right to use a registered trade mark to generate your sponsored links. Trade mark owners will have to outbid their competitors if they want their own ads to be shown next to the ‘natural’ search results when a potential customer types their name into the Google search engine.
The new policy will apply to the UK and Ireland bringing both countries into line with the existing policy in the US and Canada. The move comes after a recent policy announcement in the US followed closely by a series of court decisions in the UK culminating in the Mr Spicy case (see Briffa Article at MrSpicy).
To date a trade mark owner could prevent other parties sponsoring their trade mark as keywords.
After 5th May 2008 trade mark owners in the UK and Ireland will only be able to prevent their trade marks appearing on screen in the sponsored links.
According to Google’s notice on the trade mark policy revision found at the following link (Google Adwords) Google have justified this policy shift in the following way:
“We want advertisers to use keywords that are most relevant to their business and our user’s interests. Google's goal is to provide our users with the most relevant information, whether it is from our search results or advertisements. A key to achieving this goal with our ads is providing relevant choices and giving users the opportunity to determine which ads they find most relevant.”
Experts are predicting that this new policy may be legally challenged. Holding an auction certainly stretches the defence of ‘passive infringement’ relied on by Google’s competitor Yahoo in the Mr Spicy case. In that case the owner of the Community Trade Mark Mr Spicy sued Yahoo for trade mark infringement after Yahoo had sold the search term “spicy” to Sainsbury’s to use as a trigger for its sponsored links. Yahoo successfully argued that the search query was not used actively by Sainsburys but passively when an individual typed in the search term “Mr Spicy” into Yahoo’s search engine. In addition Yahoo argued, again successfully, that their use of the Mr Spicy mark was not an infringing activity under trade mark law. The purpose of a trade mark is to let consumers know where goods come from.
Google will presumably seek to rely on these principals to defend their policy change.
Briffa Comment:
Google will no doubt profit significantly from this policy change to the detriment of many trade mark owners particularly the big brands. Big brands like Coca Cola and MacDonalds are likely to be some of the most profitable keys words auctioned with comparison websites like Uswitch and Moneysupermarket also benefiting. However less famous brands are not likely to be greatly affected by this new policy.
In fact this new policy opens up the market for small to medium sized businesses to bid for more search terms. It is also important to remember that appearing high up in the ‘natural’ results will be far more relevant to most businesses than relying on sponsored links to attract customers. As such it will probably be more important for businesses to invest in high quality optimization then to spend money bidding for random trade marks.
Those investing in branded search terms will still need to be careful as it is only a matter of time before this new policy is challenged by one of the big brands. Mr Spicy had very specific facts as the trade mark was quite descriptive and the mark did not have a strong reputation. It will be harder for Google to argue that when a user types in a term which is clearly a trade mark such as a made up word like Intel or Coca Cola, that they are not looking for results relating to these brands. In addition, the bigger brands with reputations may also be able to rely on the fact that such use of their trade marks by Google takes unfair advantage diverting traffic away from their sites.
You can still prevent your trade marks popping up on your competitor’s websites without your consent including those triggered by the sponsored links. As such Briffa still recommends you continue to monitor the use of your brands by competitors and to take action where you can.
For more information call us on 020 7288 6003.