Back in February, Deb Wilcox wrote our first post on the legality of keyword bidding on trademark terms. We followed up on that topic in April, reporting on the Ninth Circuit’s decision in Network Automation v. Advanced Systems Corp. That was the first case to squarely confront the issue of whether a company would likely confuse ordinary consumers by keyword bidding on a competitor's trademark.
Now MarkMonitor, a company that specializes in enterprise brand protection, has released a “Brandjacking Index” that attempts to quantify the consequences of this activity with respect to hotel online bookings. The study can be accessed through HotelNewsNow or through MarkMonitor's website (registration required).
The study concludes that brandjacking results in more than 580 million visits from highly-qualified travelers being siphoned from hotel booking sites to the booking sites of channel/marketing partners or competitors. The study pegs the overall annual cost of lost bookings and unnecessary commissions at $2.2 billion.
While those numbers are sure to grab headlines, our attention was equally focused on the description of keyword purchase activity:
- More than 1,750 online travel agents purchased more than 1.3 million paid search ads in the two-week study period. This accounted for 60% to 80% of overall keyword purchases.
- Competitors (i.e., a hotel brand purchasing keywords using another hotel’s brand name) amounted to nearly half of all the bidders on keyword search terms. While competitors only ended up placing a small percentage of ads on those terms, this bidding activity likely drove up rates for those keywords.