Hitherto, only trademark owners have been allowed to use protected terms in their AdWords sponsored listings. However, from 14 September, retailers, sellers of compatible parts, as well as information sites in the UK and Ireland will be able to bid on trademarked words in ad text without the permission of the owner
Google recently enforced a similar change in policy in the US and, according to Tom Jones, head of media at search marketing agency iCrossing, it produced a "bidding-price spike". He claimed a rise of 10 per cent would cost brands "tens of thousands in lost revenue".
Paul Mead, managing director of VCCP Search, said the changes could drive bidding prices up "by more than 50 per cent", but added it was "too early" to assess its affect on the market, with price rises varying depending on the brand.
Google's decision has prompted a backlash from some of the UK's biggest brand owners.
Ian Armstrong, head of European communications at Honda, warned that the search giant's revised trademark policy may deter further investment from UK advertisers. He said: "This is not a good move and could tarnish its relationship with brands. However, it would be brave for anyone to turn away from Google altogether."
Tom Hings, former brand marketing director at Royal Mail, was also critical of the change. He claimed Google is profiteering from the millions of pounds companies have spent on building a strong brand identity via search.
However, Peter Fitzgerald, Google UK industry director for the retail sector, defended the decision.
He said: "This will offer a wider catchment area into the product users are seeking, and for the brand's products to be distributed."
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