Well, of course it's not quite that simple. The use of another's trademark for ad placement has been a recurring topic of legal advice roughly since the introduction of Google Ads and has already occupied the European Court of Justice many a time.
Nevertheless, Google Ads are repeatedly placed on other people's brands or competitors. The question now arises:
Is this allowed or not?
We want to take a fundamental look at this very complex topic and start with the strategy that has triggered advertising with other people's brands: Brand bidding.
Basically, brand bidding means nothing more than placing Google Ads on keywords with your own brand. Of course, this is absolutely unobjectionable from a legal point of view, since it is only about your own brand.
However, brand bidding also works in connection with the competition. In this case, the ads are not only placed on keywords with your own name, but also on keywords with the competitor's brand. If you exceed the bid of the competition, your own ad will appear even if the competitor's offer was actually searched for.
Is it legally permissible to use a third-party brand as a keyword to trigger an ad placement? The clear answer is: it depends...
In principle, this method is permitted. A third-party brand may be used to place ads for one's own competitor's product - but only if the ad clearly distinguishes between the competitor's brand and one's own brand. It is inadmissible if it is suggested to the viewer that the advertiser himself sells the competitor's product or is economically connected with it. Likewise, the use is inadmissible if disparagement of the competition takes place via this keyword.
A legal examination of the competitor's trademarks for possible exceptions is indispensable.
Surprisingly, Google, as the provider of Google Ads, keeps completely out of this and states that the use of trademarks as keywords is not investigated or restricted.
The use of a third-party brand name in the title or text area of the ad is generally not permitted. However, there are of course exceptions to this rule.
In order to be legally permitted to use third-party trademarks in advertisements, there must be a special justification. This case arises if, for example, a reseller or distributor of spare parts has several products of different brands in its range and wants to advertise them.
The use of a competitor's brand to advertise one's own products, on the other hand, is prohibited. It is true that there is the possibility of comparative advertising, which has been legal for some years. However, a precise legal examination and compliance with numerous requirements are necessary here.
The decisive factor in all actions is what the user ultimately sees. The more the user is confused or deceived, the more likely it is that the use of the third-party name is unauthorised. If the distinction between the third-party brand and the company's own product is very clear and not disparaging, it may be possible to assume a grey area.
Advertising based on other brands may be justified in exceptional cases. At the same time, however, it is also an admission that one's own product is not better or more outstanding than the competitor's product. In case of doubt, users usually opt for the higher-quality product. The legally sound way is therefore to rely more on one's own product and less on the competition.
Under certain circumstances and with numerous exceptions, it is also possible to place ads in Google Ads on the basis of third-party keywords. In very rare exceptions, the use of a third-party brand is even possible in the ad title or text. However, this type of advertising is either very risky or involves a great deal of effort in terms of legal advice. In case of doubt, companies should rather concentrate on themselves and their own products instead of using the competition for their own purposes.
Attention: This article provides a general overview and should not be understood as legal advice. Please consult your legal counsel for specific cases.
As a digital agency, we are happy to help you with questions about brand bidding!