Should You Bid on Branded Keywords? List of Pros and Cons

By Jason Parks Articles September 6, 2022

Should You Bid on Your Brand Name with PPC Ads?

Bidding on your brand name is a controversial topic. It reminds me of whether you’ll be voting democrat or republican in the next election. Like politics, people have strong opinions on branded keyword bidding. It’s hard to convince someone to change their mind.

There’s one camp that believes you must bid on branded keywords so competitors don’t steal your coveted branded traffic. The opposing group feels strongly that you’d convert on your branded traffic and you’re wasting money bidding on your own brand name.

After reading my list of pros and cons, you’ll be able to formulate your own opinion as to whether you’ll incorporate branded keyword bidding into your paid advertising strategy.

Need Support? Contact our PPC experts – We manage millions in paid ad spend for small, medium and large businesses.

Table of Contents

1 Should You Bid on Your Brand Name with PPC Ads?
2 Pros – Bidding on Branded Keywords
3 Cons – Bidding on Branded Keywords
- 3.1 Traffic might have converted without branded ads
- 3.2 Misleading Conversion Data
4 In-Closing

Pros – Bidding on Branded Keywords

The thought is sickening to many businesses to have their competitors outrank them for their own branded search on Google. This is why so many companies bid on branded keywords. Let’s dive into the reasons why you should bid on your branded keywords.

Populate ahead of competitors

When you bid on your brand name, you can ensure that competitors don’t populate ahead of you on Google, if you were to outbid them.

In the example below, you can see that competitors are constantly bidding on our brand name, The Media Captain. At first I was frustrated with competitors bidding on The Media Captain. Now, I take this as a badge of honor. If people didn’t notice the work we were doing, they wouldn’t be bidding on our brand name.

I’ve taken the stance that I don’t want competitors to populate ahead of us on Google when people type in The Media Captain. I want our advertisement to be the first thing people see. Your business needs to determine whether or not you’re comfortable with your current and potential customers seeing a competitor ahead of you for your branded search.

How well known your brand is will determine how much money you spend on branded search. The more people that type in your brand name, the more clicks you’ll receive. For The Media Captain, we spend approximately $300 per month on branded ads. For DermWarehouse, our in-house eCommerce brand, we spend approximately $2,000. The reason is because DermWarehouse gets a lot more traffic since we have over 350,000 customers.

Agency Tip: If nobody is bidding on your brand name, there’s less urgency to bid on your brand name.

Important to Remember: You can’t stop your competitors from bidding on your brand name.

Stellar Messaging

Controlling the narrative doesn’t get talked about enough but is one of the best reasons, in my opinion, to bid on your brand name.

You can’t edit organic sitelinks, meaning you’re stuck with what Google pulls in from your website for the organic results. Branded advertisements provide you with more flexibility in your messaging.

Let’s say you’re an eCommerce store running a weekend sale that you want to promote. You can spread the word about the promotion with your branded advertisement.

The example below is for our in-house eCommerce brand, DermWarehouse. We bid on our brand name so we can inform people about our 100+ brands, our favorite picks and more information about our top-notch customer service. There’s a lot of real-estate with branded PPC campaigns through ad copy and sitelinks to better inform your current or prospective customers about the happenings within your business.

The messaging you can create and change in real-time is a good reason to partake in bidding on your branded keywords.

Agency Note: On the right hand side of the screen, you’ll see DermWarehouse products are populating for our branded search. Google pulls in products from our Google Shopping Feed for branded search. Learn more about our Google Shopping expertise.

Relatively low cost per click

Our average cost per click for DermWarehouse and The Media Captain is under $1.15. According to WordStream, the average cost per click in Google Ads across all industries is $2.69 for search.

The average cost per click for branded keywords is cheaper in most instances than non-branded. While people get upset about having to pay-per-click for their own brand name, it shouldn’t be a big part of the overall budget (more on this to come).

Agency Tip: For both The Media Captain and DermWarehouse, we spend less than 10% of our budget on branded PPC campaigns, leaving enough budget for non-branded search terms.

Ability to add negative keywords + Search Terms

Not all branded traffic is going to convert for your business. For example, we worked with a plumbing company. A lot of people would search for “The Waterworks Customer Service.” We knew when people were looking for customer service, they weren’t interested in new services, they were existing customers looking for an issue to be resolved. We added “Customer Service” as a negative keyword to better control the traffic for branded search.

You gain such valuable insight by looking over your search terms within branded to see how people search for your business. You can also make sure you get the right sort of branded traffic by adding in negative keywords.

Cons – Bidding on Branded Keywords

Rand Fishkin, a famed marketer, recorded a great video highlighting how your branded search traffic would have likely converted without you having to pay for an advertisement [view here].

There are many businesses and agencies that don’t bid on brand because they feel it’s a waste of money. I’ll provide you with some of the cons behind bidding on your brand name.

Traffic might have converted without branded ads

When people are searching for your brand on Google, the intent is high, meaning they are likely to convert.

The branded ad naysayers will tell you that branded ads are just another way for Google to take your money to increase their bottom line.

If someone had already purchased products for DermWarehouse and they typed in “DermWarehouse” onto Google, they are likely going to convert as they’ll want to repurchase from us. Not bidding on your brand name is a way to save money if you’re confident the traffic will convert regardless.

Misleading Conversion Data

I’ll never forget when I did consulting for a large car Insurance company and audited their PPC account in 2012. The entire campaign consisted of branded and retargeting advertisements.

When I asked their current PPC agency at the time why they were only bidding on branded advertisements, the agency told me they were instructed to keep the cost per acquisition under $70. Since car insurance has such a high cost per click, they were only bid on branded terms and leveraged retargeting to drive a low cost per acquisition.

While this agency was hitting on their “benchmark,” the numbers were misleading. They weren’t converting any net-new business. They were just driving customer acquisition from existing customers or people already familiar with the brand, which I felt was misleading to the insurance company, especially considering the monthly fee which this agency was charging.

There are a lot of agencies that like to incorporate branded advertising into the mix to drive down the cost per acquisition. There’s nothing wrong with bidding on branded, our agency does this frequently. It’s important within your reporting to break down the cost per acquisition for branded versus non branded though. This gives you better insight into your performance for net-new customers versus customers you likely would have retained through branded.

We also encourage our clients to spend more than 80% of their budget on non-branded keywords so they can introduce their company to new potential customers. If the majority of your budget is going towards branded, you are not getting new traffic and new potential customers to your site.

In-Closing

There’s no right or wrong answer as to whether or not you bid on your brand name.
You can’t stop your competitors from bidding on your brand name.
Branded ads allow for your company to appear at the top of Google with strong messaging for a relatively low cost per click.
The people who click on your branded ads might have converted organically, even if your advertisement wasn’t there.
Make sure you clearly understand whether or not conversions from PPC are coming from branded versus non-branded.

If you would like to discuss your paid advertising or digital marketing strategy, you can contact The Media Captain today!