According to ClickZ:

“The holiday season will be a real proving ground, to see how quickly
Google responds to issues,” Jeremy Hull, account leader at Range Online
Media, told ClickZ. “Do they have an adequate team in place, with
policies and procedures that are scalable for the holidays?”

This all became an issue in May, when Google changed its policy to let advertisers bid on trademarked keywords they don’t
own under certain circumstances (reselling a product or discussing it
in an informational way is now permitted).

This impacts big brands by increasing competition for bids for their branded key words and driving up the bid price. Also, non-trademark owners might sell trademarked items and steal search traffic from the rightful owner of the product.

Jeremy Hull, account leader at Range Online Media, tells ClickZ:

“Anything you could buy as a knock-off on the streets of New York and
rub the logo off with your fingernail…those are the same brands you
are seeing victimized by fraudulent behavior online as well. So, major apparel, luxury, jewelry, fragrance, and other
well-known and sought after brands are the hardest-hit by trademark
infringement.”

According to comScore’s third quarter earnings for 2009, pure play ecommerce companies are getting 6 in 10 dollars online — the highest rate ever.

Google is set up to punish companies that use others’ key words in a
competitive, critical or negative way. The problem is that the search
giant expects brands to monitor their own trademarks and report
violations. During the holiday season, when there is a general deluge
of shopping, advertising and branding, it’s harder to monitor exactly
what’s going on with other people’s advertising.

And letting other people bid on branded key words is not all bad for the original brand — especially if they’re selling the item and sending revenue back to the manufacturer. That’s Google’s argument. Here’s how a spokesperson defends the
change to ClickZ:

“Some trademark owners support other advertisers using their
trademarked terms in ad text to generate traffic and sales of their
products; other trademark owners feel differently.”

The next few months will show if Google or wary advertisers were right on this issue. It worked for them in the U.K.

According to NetImperative, when Google announced that anyone would be able to bid on branded terms there,

“many
assumed the amount of Internet search traffic that brand owners receive
from searches for their own trademarked
brand terms would decrease, because competitors and affiliates could
now bid on these terms,” commented Robin Goad, Director of Research at
Hitwise. “In fact, there was only a tiny decrease in traffic to brand
owners’ websites following the changes. UK Internet users have stayed
loyal to their favourite brands, but at what price? It seems that the
top brands in the UK have chosen to increase paid search activity on
their own brand terms rather than lose traffic to competitors or
affiliates.”

Of course, that turns out to be good for Google’s bottom line. But if brands see negative effects over the next few months, Google may be forced to switch to Yahoo’s model.

Yahoo!’s policy permits
the purchase of another’s trademark as a keyword only if:

“the advertiser presents content on its Web site that (a)
refers to the trademark or its owner or related product in a
permissible nominative manner without creating a likelihood of
consumer confusion (for example, sale of a product bearing the
trademark, or commentary, criticism or other permissible
information about the trademark owner or its product) or (b) uses
the term in a generic or merely descriptive manner. In addition,
the advertiser’s listing should disclose the nature of the
relevant content.”

Also, Yahoo self-polices violators.

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