Should I be bidding on competitor keywords?

Key Takeaways from this article

Bidding on competitor keywords drives up cost-per-click and results in a lower volume and quality of leads, while also drawing budget away from branded keywords. Overall, bidding on competitor keywords weakens PPC performance.

Ultimately, it is up to you whether you want to try this out with your branch. However, we have collected some data on previous branch campaigns targeting competitor keywords below, and we would recommend focusing on branded keywords only.

What are branded and competitor keywords?

Branded keywords include your brand name and variations of your brand name. Competitor keywords are the same, but for other brands in the same industry.

For example, if I had an estate agent called Josh & Co, branded keywords would include terms like "Josh & Co", "Josh Co", "Josh" etc.

Competitor keywords would include "Savills", "Leaders", "Romans" etc.

Challenges with Competitor Keyword Targeting

1. Higher Cost-per-Click (CPC): CPC tends to rise significantly, often 3 to 5 times higher than average.
2. Reduced Engagement: Ads targeting competitor keywords usually see a drop in engagement, with a lower Click-Through Rate (CTR).
3. Low-Quality Leads: Most leads generated are via calls, which often turn out to be non-prospective.
   

To illustrate, here’s a comparison of a branch’s performance over a 30-day period, comparing competitor keyword targeting against branded keyword targeting:

This data clearly shows that cost-per-click for competitor keywords increased by nearly 6 times, while ad engagement dropped by 85%. Despite spending more, the results did not align with expectations, with no conversions recorded.

Given this, we recommend re-evaluating the strategy for competitor keyword targeting and focusing on approaches that yield better ROI and engagement.