Google Ads are one of the most widely used online advertising platforms in the world. As advertisers implement creative advertising strategies, they often either incidentally or purposefully use third party trademarks to drive traffic to their websites. Advertisers should be aware that certain practices may increase the risk of a trademark infringement claim. Advertisers should employ best practices and carefully navigate trademark law when using trademarks as keywords, incorporating trademarks in ad text, and/or managing dynamically generated ads.
Types of Search Campaigns
A search campaign is a type of advertising campaign wherein advertisers place text ads within Google search results that are triggered by keywords entered by a user. A campaign contains one or more ad groups and each ad group contains one or more ads. Google Ads offers two types of ad groups: standard or natural ad groups and dynamic ad groups.
When creating an ad within a standard or natural ad group, advertisers choose keywords that are related to their product or service and set a maximum bid, which is the highest amount that they are willing to pay for a user to click on their ad. Bids are anonymous and the highest bidders will receive preferred advertising spots.
When creating an ad within a dynamic ad group, advertisers identify dynamic targets rather than keywords and the Google search index determines when a user’s search is relevant to the dynamic ad targets. The ads are then automatically generated by the search engine.
Use of Trademarks as Keywords
As noted above, advertisers use keywords to define standard or natural ad groups. Advertisers often use third-party trademarks such that a user who searches for another party’s brand will trigger the advertiser’s brand. So long as there is no likelihood of confusion, courts have generally held that an advertiser may use a competitor’s trademark as a keyword.
However, if the advertiser engages in additional actions intended to and/or resulting in reasonable consumer confusion, the advertiser could be liable for trademark infringement. For example, if an advertiser is purposefully attempting to divert traffic from a competitor’s website to its own website, includes multiple uses of a third party’s trademarks, and/or intentionally tries to deceive a user, the advertiser could be found to have violated a third-party trademark.
Use of Trademarks in Ad Text
Once an advertiser chooses keywords, it writes the text of the ad, which includes at least one headline, a link to the advertiser’s website, and a brief description. Including a word or phrase protected by trademark in the text of an ad may constitute trademark infringement if the ad is likely to mislead or confuse consumers. To determine whether the use is infringing, courts undertake a typical likelihood of confusion analysis, considering multiple factors such as the strength of the trademark, similarity of the marks, similarity of the goods or services, evidence that the advertiser intended to confuse consumers, and the general sophistication of consumers in the relevant market(s). Thus, an ad’s likelihood of confusion is highly fact dependent and requires courts to examine the advertiser’s use of the trademark in the context of the ad as a whole.
To minimize potential liability, advertisers should refrain from or minimize use of others’ trademarks in the text of their ads. If a third-party trademark is included, advertisers should take additional steps to reduce likelihood of confusion, especially when the advertiser and the trademark owner are competitors. For example, using a competitor’s trademark as a point of comparison is generally permissible so long as the advertiser is acting in good-faith and takes reasonable measures to prevent confusion.
Use of Trademarks in Dynamic Ad Groups
Unlike a standard ad group, which requires advertisers to select keywords and write their own ads, a dynamic ad group automatically generates ads based on a user’s search and the contents of an advertiser’s website. When a user searches terms that are related to an advertiser’s webpage, Google generates an ad headline that closely matches the search query and chooses a relevant landing page on the advertiser’s website.
Dynamic ad groups offer many advantages over standard ad groups. First, they are simpler. To set up a dynamic ad group, the advertiser chooses webpages for Google to target, writes the ad description, and Google does the rest. Second, dynamic search ads can help advertisers capture traffic they otherwise may have missed using manual keyword selection. Third, dynamic ads may increase user engagement and conversion rates by generating headlines tailored to a user’s search terms.
However, dynamic ad groups also present risks, as advertisers lose significant control over when and how their ads are displayed. Apart from adding a term as a negative keyword, there is no reliable way to prevent Google from inserting a trademarked search term into the headline of an ad. Google could then create an ad in a way that creates consumer confusion with a third party’s trademark rights and the advertiser could be responsible.
Google Ads are an extraordinarily helpful advertising tool to direct traffic to a website. Advertisers should err on the side of caution when using third-party trademarks in their Google Ads, especially when those trademarks are seen by consumers. Advertisers should be particularly careful when using a dynamic ad group as the advertiser loses control over the content of the ad.
This LEGALcurrents was contributed to by former HSE summer associate Lucy Oh.
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