Recently, a SmallBusiness.com user sent us this question about a competitor using their company’s name as a search term in their search advertising efforts.:

What can I do if my direct competitor’s Google ad appears whenever a customer does a Google search for my company’s name?

(Note: There are parts of this question that require an answer that sounds like legal advice. While we’ve read several John Grisham novels, we suggest you check with a trusted legal advisor to back up what you’re about to read.)

First, you need to understand what’s taking place. Your competitor is using Google Adwords, the service that generates the vast majority of Google’s billions of dollars in annual revenues. You competitor is NOT using your name in their actual ad but they are using your name in the list of “search terms” or “keywords” they are “bidding on.” The term “bidding” is what Google uses to describe how ads are purchased on Google: the advertiser who pays the most (along with other factors) gets the best (usually, top) ad placement.

The legal issues and answer.

As your competitor is not actually using your name in an ad, but is only bidding on a search term, Google will do nothing. On the Adwords website, Google says, “Google will not investigate or restrict the use of trademark terms in keywords, even if a trademark complaint is received.”

If your company’s name is trademarked and your competitor is using it in their actual ad (two things that don’t apply to your specific situation), Google’s trademark policy page has more information to consider.

Of course, in the U.S.A., anyone can sue anyone else for just about anything. We suggest that you have a nice, calm meeting with your personal attorney (one that has expertise in trademark law) and discuss the relative merits and costs involved in trying to go up against your competitor and Google. (Translation: You’ll spend lots of money and lose.)

The practical answer.

The following answer will help you understand why Google’s revenues are so enormous.

If your competitor has purchased an Adwords ad campaign that uses key words including your name, you need to purchase an Adwords ad campaign that uses all the same key words. While we’re not necessarily advising you to sink to the pathetic depths your competitor did when purchasing your name, we’re also not advising you NOT to. That’s more of an ethical issue than a marketing issue. And by ethical issue, we mean, if you don’t use their name as a search term, you can claim to be taking the moral high ground to anyone who asks, and anyone who doesn’t ask but you just happen to tell, for that matter.

Here’s how to purchase search ads via Google Adwords:

1. Set up an Adwords account.
2. If the competitor is also purchasing search terms for ads on Bing and Yahoo!, set up an account there also.
3. Set up an ad that is similar or better than the competitor.
4. Bid for search terms after you’ve reviewed Google’s “Keyword” selection resources.
5. Experiment with the bid price to see how much it takes you to get your ad placed higher than their’s. (But don’t get into a search term bidding frenzy.)

The good news.

The “organic” or “natural” results for the search terms you sent us all point to your company and not the competitors. That means you are using your website and social media in a way that Google rewards. In other words, you competitor is having to buy his/her way into the more valuable part of a Google search results page.

(Photo: One Lucky Guy via Flickr)