In a previous post I explained why companies should use their brand name in their PPC campaigns. In short, you should be doing this because it can be a source of cheap traffic and because you need to ensure that your competitors do not take up the prominent top PPC listing when people search for your brand. That said, who should you trust to do your brand bidding for you?

Traditionally, brand management has been the domain of offline advertising agencies. But from what our company has seen so far, these agencies are terrible at running a decent PPC campaign. They offer it to their clients because they want to ‘own’ a client and offer him a full range of marketing services. But in general what the client gets in return is not good value for money. Agencies will run a PPC campaign on a few broad keywords, including brand names, and will generate a probably decent amount of traffic but for a sizeable management fee, usually a percentage of advertising spend.

Based upon data from campaigns that we run for our clients, between 40% and 60% of search traffic is generated by a client’s brand name. So running a PPC campaign just based on a few keywords is feasible if you have a well known brand but you lose out on a large portion of potential traffic if that is all you do.

The question is, should you be paying your agency a lot of money to run a small brand based PPC campaign? Probably not.

An alternative option is to let affiliates use your brand name in their campaigns. But If you only have a few affiliates, they will also behave like an agency and just run a small campaign based on your brand name. After all, it will give them the greatest return for their effort. It is basic economic theory in practice. They will get a very good ROI on the cheap brand name traffic and are not incentivized to expand their campaigns to include the 40-60% of potential customers you are missing out on.

If you have numerous affiliates however, the competition amongst them will ensure that bid prices for your brand name increase so much, that your affiliates are forced to expand their campaigns into the (less competitive but less lucrative) long tail to generate more profits.

This scenario probably maximizes your traffic volumes but having plenty of affiliates makes it difficult to police their behavior and protect your brand. Although there are plenty of reputable affiliates out there, there are also the rotten apples seeking a quick gain at any cost and your brand reputation could suffer.

So what is the best option? Personally I would not be comfortable to make my brand name available to any PPC marketer if I did not have a personal, direct relationship with them. This rules out making your brand available to affiliates indiscriminately. I would select affiliates with a proven track record and with solid references.

At this point, I would not chose a traditional agency if they charged me a percentage of spend on my PPC campaign.

Would I run my PPC campaign in-house? I would, if I had the expertise, a well-known brand and a small set of products or services on offer. Otherwise, you’re better off to outsource it.

In the end, it doesn’t really matter who manages your (brand based) PPC campaign, as long as they offer you full transparency. Chose a PPC marketer that you can trust and that will work closely with you to optimize your acquisition costs. Incentivize them to perform and don’t reward them to spend money on your behalf without accountability. Verify that you get the most amount of qualified traffic for your money!

As I have said before, you cannot hide bad performance for long in the world of PPC. That is why affiliates tend to be better at PPC than agency. They have to perform to survive. But a fee-based agency could be more incentivized to look after your brand’s reputation. There is however no reason why the two models cannot be merged. With full transparency and accountability it is possible to reach a business model that combines the performance of an affiliate with the trust of an agency.

Some retailers and traditional advertising agencies are not keen on using a company’s brand in a PPC campaign. There are two main reasons why I believe not using your brand power in PPC is a poor decision. These two reasons are not necessarily the ones cited by marketing managers as they might be hesitant to admit their real motives.

First of all, ‘brand management’ has always been the traditional marketing agency’s ivory tower. It is what they do and in a way, it is the only thing they do. Very little of their advertising spend has an accurately measurable ROI. These agencies do not want to cede any ground to PPC marketers because it is an area they tend to have very little expertise in and they just feel threatened. It is easier to convince their clients that brand bidding is pointless in PPC advertising and to retain exclusive control over a client’s brand.

Secondly, their clients listen because they are cost conscious. They spend large amounts of money on building their brand in the traditional media so why would they spend any more on PPC? Obviously, if consumers are searching for their brand on search engines that means they already know the brand. No need to spend even more money on PPC ads. All they need to do is sit back and hope that the consumer actually finds their site. Right?

As retailer, you are now reliant on the fact that your site shows up on top of the natural search results for the query that the user typed in on the search engine. This is a fair assumption if you have a well established website which was built using SEO best practices. But it is also a fair assumption that your competitors are bidding on your brand and that their ads will appear above you natural listings. Consumers are a fickle bunch and a well written ad might persuade them to shop at your competitor instead.

In addition, consumers will find numerous ways to misspell your brand name. Are you sure your site will come out tops for each of those misspellings? In PPC campaigns, Google will match your ad automatically to its misspellings and with one ad, you can target all those consumers who otherwise might never find your site.

Finally, more and more people (like myself) type a brand name into a search engine (it’s so tedious to type the ‘www’ and the ‘.com’) and expect the search engine to come up the with the site we’re looking for. Just check out the popularity of these two brands on Google. Do you really want to rely on natural search results to drive this traffic to your site?

Yes, it does not seem fair that you need to pay for your brand name in PPC campaigns when people could find your site through other means, but that is exactly what search advertising is about: making it easy for people to find what they are looking for.

PPC based brand bidding is not expensive relatively to bidding on more generic terms. Google will give you an excellent quality score when you bid on your own brand which means CPCs will be really low. But there are quite a few caveats which you should take into account when outsourcing your brand bidding to a PPC marketer. I will address these in a next post.

To conclude for now: brand bidding constitutes an additional cost to your brand building marketing campaigns but the cost is likely to be marginal. And for this marginal cost you can ensure that your potential customers do not get lost on the way to your site. A small price to pay I would say.