Affiliate marketing can work wonders for SaaS brands looking to grow their business and offer more value to their customers. When done right, affiliate marketing is a great performance-based opportunity that can net you a steady alternate income stream.
Without clear PPC agreements set in place, however, affiliate partners may bid on your brand name without asking for authorization. This, in turn, can result in diverting traffic that rightfully belongs to you rather than to the affiliate’s site. In the meantime, affiliates will generate commission from you and contribute to an increased bid cost for your brand terms.
Understanding Brand Bidding
Simply put, affiliate brand bidding is the practice of affiliate partners using their own funds to create and display ads on Google and other search engines. These ads appear on consumer searches for your brand name.
When consumers click on the ads, the affiliate will receive a commission for any orders placed via those links.
Why You Need to Pay Attention to Affiliate Brand Bidding
Consider this: 68% of website traffic is generated by search engines. If brand bidders – whether affiliates, competitors, or even copycats – use your brand keyword in a display ad, prospects might land on a third-party website, even though they were looking for you.
This can cost you valuable branded traffic and conversions.
While you might not lose sales if the brand bidder is an affiliate, you may end up paying an unjustified commission for customers that would have been yours if they were not misguided through the affiliate’s own channels.
How to Prevent Brand Bidding
To avoid brand bidding, create a paid search policy. In most cases, one of the first things you should address within your affiliate agreements is bidding restrictions.
Insisting upon affiliates excluding your branded terms from their paid search campaigns will prevent them from intercepting what would otherwise be sales through branded search.
Other items to consider prohibiting include using the brand’s name (or specified misspellings) in the display name or display URL, as well as appearing at all on branded keywords.
Is It Worth Bidding On Your Own Brand Name?
Bidding on your brand name can be a viable strategy if your competition is already bidding on your brand. This enables you to protect your position and stay on top of the page.
Although you may pay for some visits that would otherwise come organically, there are a number of other great reasons to bid on your brand name.
Bidding on your own brand gives you more real estate on page one. It allows you to tweak your message, highlight a promotion, or draw a particular emphasis – regardless of the search term.
What’s more, adding branded terms to your campaigns can boost conversions and increase sales. While it might feel counter-intuitive, conversion rates from PPC are often higher because you have more control over the conversion funnel, ad message, and landing page.
Combined with the increase of clicks you’ll receive, your branded ads may bring you an astonishing increase in both revenue and site profits.
Measuring the Impact
It’s always worth remembering that the more people use a keyword, the more expensive it gets to bid on it. That means that if someone else is bidding on your brand keyword, the cost-per-click (CPC) rate will rise.
When looking at CPCs, it’s important to note the size of the affiliate issue and how much influence you have over it.
Is your cost-per-click getting too high? Here’s how to protect your brand from the race to zero in paid search.