In the article “New Programs & Trademark Bidding“, we discussed the pros and cons of allowing Affiliates to bid on trademark terms and offered some tips to consider should a program allow Affiliates to bid on their brand name. Today I’d like to expand a bit on this conversation and discuss the importance of the Merchant’s program agreement as it relates to trademark bidding.
The program agreement is a legal contract set up by the Merchants for their Affiliates. If a Merchant would like to create guidlines or restrictions for Affiliates in regards to the use of their trademark term(s) in paid search, these will need to be clearly listed and explained in the program agreement. As the Affiliate Network, we are not in the position to offer any legal advice to our Merchants which is why we do not provide specific advice on language or agreement templates. Each document should be reviewed by the Merchant’s own legal team. However, I am able to give you a few tips that could be taken into consideration and used as a starting point for Merchants who would like implement some restrictions for PPC Affiliates.
- Penalty. Merchants may want to explicitly state what action will be taken against Affiliates who violate their terms. Example: Immediate termination, reversed sales, reset commission to zero, etc. One point to think about here – if a Merchant removes an Affiliate from the program but the Affiliate continues to run the ad on the search engines, the ad will appear when a consumer searches for the Merchant’s brand but the link to the site will not work. Affiliate links will break once an Affiliate is removed from a program. This is the reason some Merchants choose to reverse sales or zero out commission until an Affiliate removes the ad. So that the consumer will have a flawless experience but the Merchant is not paying for traffic that generated by the Affiliate in violation.
- Are terms off limits or restricted? Merchants have the option to either forbid the use of their trademark or they can set limits on the bidding. In some cases, a Merchant may decide to simply restrict the terms so that Affiliates are taking up the retail space in the search engine while at the same time the Merchant is not competing for the use of their own trademark. A Merchant is able to set bid limits from the PPC Bidding Rules.
- List of trademark terms. Merchants will want to explicitly lay out exactly what terms are either off limits or restricted. I have listed a few examples below. Any phrases or keywords that you list in your agreement be sure to also include in the PPC Bidding Rules.
For example, let’s suppose the Merchant’s site is ILoveHighfives.com. Some examples of terms they might consider restricting would include:
Any Common Misspellings/ Variations
Once the terms are laid out in the program agreement, Merchants will want to keep on eye on their Affiliate’s activity. Below are a few tools that can help Merchants police and monitor compliance from PPC Affiliates.