Interflora Marks and Spencer High Court

Reaction to Interflora vs M&S high court decision: the7stars, Total Media, Manning Gottlieb OMD, Mindshare UK


By Stephen Lepitak | -

May 21, 2013 | 7 min read

Following today’s announcement that Interflora has won its High Court battle with Marks & Spencer over the use of the word ‘interflora’ as a Google Adword to promote the latter’s brand, The Drum has spoken to several people in the industry to see what affect this could have on the PPC market.

Jenny Kirby, head of performance, Mindshare UK

A few years ago, advertisers could register a trademark protection order with Google, and Google would prevent anyone other than the trademark holder (and authorised third parties) from bidding on the advertiser’s trademarked terms or including them in their ad copy.When Google stopped policing the use of trademarked terms as keywords the onus moved onto the advertiser to approach competitors who were using their brand terms; many advertisers adopted an approach where it was not considered good practice to bid on competitor terms. It was not gentlemanly and besides, Google’s Quality Score algorithm meant that any clicks received on any competitor terms would be costly as the ad would not be relevant to the term searched for. Now that the High Court has found in Interflora’s favour, it sets a precedent that bidding on a competitor’s brand term can have legal repercussions.We are likely to see advertisers that do bid on competitor terms withdrawing from this strategy, or at least viewing it as a slightly more risky strategy than they did before. However, it is not particularly straightforward to see when an advertiser is actively bidding on a competitor’s brand term; broad and phrase matching as well as search retargeting mean that a user may see an ad that Google feels is relevant to their search, even where the advertiser has not specifically targeted the terms that the user has entered.Trademarks and brand terms are a very important part of an advertiser’s search strategy and will continue to be so, but today’s ruling is unlikely to achieve Interflora’s goal that “search results take consumers directly to the brands they are looking for”. We are likely to see behaviour and inferred intent in search behaviour increasingly influencing the results that Google displays, which is over and above what can be managed through trademark management.

Hayley Spence, head of search, Manning Gottlieb OMD

The decision to rule in favour of Interflora is an interesting one and will shake up the industry. It is similar in some ways to the failed case against Google from LVMH. What makes this case different, however, is that Google wasn’t involved.Ultimately, Google controls what appears on their search engine and brand bidding on trademarked terms is not illegal in their view. In fact, many times our ads have appeared against competitor brand terms despite not bidding on them due to Google’s broad match policy.Paid Search Specialists will have to agree a competitor strategy with their clients, if they don’t have one in place already, and come to a decision on whether the client wants to show up against competitors or not. If not, specialists can pull Search Query Reports (SQRs) on a regular basis, identify the keywords we have actually appeared for, and then actively add competitor terms into AdWords as ‘Negatives’. Google guarantees that we will not appear against these negative terms, although we can never be 100 per cent sure as Google’s algorithm decides and this changes on a regular basis.The real issue is that people may have associated M&S with the Interflora network and this may have had a significant impact on their trade. I haven’t seen the actual paid ad or landing page that M&S used so cannot comment on their conduct. If they did mislead users, than yes, they are clearly behaving unethically. If they did not, then Google have a challenge on their hands as many advertisers bid on competitors terms to gain more market share. Currently Google allows this. It also wants to provide users with as much relevant choice as possible and will let Quality Score (their relevancy score which is mostly impacted by CTR) decide if they stay or not.I would say most advertisers have tested competitor brand bidding at one point. Rightly or wrongly, many see it as a way of increasing brand awareness and piggy backing of the TV spend of others. If this is now illegal in some circumstances due to fair competition laws in certain sectors, the Google algorithm or approval process to go live has to change.

Paulo Ribeiro, head of PPC, Total Media

We’re very surprised about the High Court ruling as competitor brand bidding has become an industry wide practice since Google controversially changed its UK policy in 2008. The High Court’s decision essentially overrules Google’s own policy, removing risk and responsibility from Google and placing it firmly in the hands of the advertiser.We envision three possible outcomes for industry: If Google continues to allow the practice it is likely advertisers will continue to bid as before. However, if this ruling sets a precedent for several more high-profile cases, we’d expect advertisers to abandon this practice en masse.Or will Google be forced to revert back its policy and redouble its efforts to police adwords? We’ll have to wait and see.

Dino Myers-Lamptey, head of strategy, the7stars

This is a surprising ruling given that competitive brand ‘trademark’ keyword bidding remains unchanged since 2008. Nevertheless, it is understandable when this negative bidding has an adverse effect on a trademark and it is in the consumer’s best interest to prevent it.Preventing brand ‘trademark’ bidding protects the smaller brands whose rising brand keyword equity is targeted by bigger brands with bigger pockets.Competitive brand ‘trademark’ keyword bidding is often beneficial, not only to the brand owner, but also to other brands, like partners and suppliers, so it should continue in this form.Most consumer brand keyword searches are specific, so the natural search results should be the most relevant for their brand query, and that should remain despite this ruling.This ruling will concern Google which introduced brand ‘trademark’ bidding to increase inter-brand competitive spending. Reduced demand will now drive down the cost-per-clicks of the keywords.

Alex Campbell, deputy MD of The Search Agency

Bidding on competitor terms has always been a controversial strategy. For every advertiser who can achieve good ROI with this approach there is another for whom competitor-bidding leads to an expensive arms race from which only Google emerges as a winner. The M&S / Interflora decision will make bidding on competitor brand keywords significantly more risky and will likely have the effect of reducing this practice. What’s perhaps most interesting, however, is the minimal investigation of Google’s role. The Search Agency’s own testing has shown that Google will automatically broad-match the search query ‘interflora’ to the keyword ‘flowers’, such that it is perfectly possible for one of Interflora’s competitors to appear for this type of search even without bidding directly on the brand keyword. If Interflora, or another large advertiser, have the stomach for it, a fight with Google over the potential for brand infringement via their algorithmic matching may be the logical next step.
Interflora Marks and Spencer High Court

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