Now that the dust has settled (and so has Google), what should the search advertising industry make of the results of that case? Has it settled everything regarding Google's right to sell branded keywords to the highest bidder? Has it settled anything?
First, let's review what Geico versus Google was all about. The insurance company that has both Warren Buffet and a dancing gecko going for it sued Google for having allowed competing insurers to buy the Geico mark as a keyword. The claim was based on the Lanham Act, a part of the Trademark Code. Geico asserted that its trademark rights were being violated both by the sale of the marks but also by the use of those marks in the competitor's ads.
In December 2004, the court held that Google was within its rights to sell trademarked names as keywords but that the issue of liability for damages from the use of the Geico mark in the competitor's ads could go to jury trial. In a written opinion released in August, the court reiterated and expanded on its December decision that Geico failed to produce sufficient evidence to establish that advertisements that do not reference Geico's trademarks in their text or headings violate the Lanham Act, even though Google's advertising program enables those ads to appear when a user searches on Geico's trademarks. The Court also held that the use of Geico's trademarks in the heading or text of advertisements that appear when a user searches "Geico" does violate the Lanham Act, leaving as the only remaining issues in the case whether Google is liable for such violations and, if so, the amount of damages. The Judge gave the parties 30 days to settle. Geico and Google came to an undisclosed settlement on the thirtieth day.
Google had earlier adopted policies regarding marks appearing in competitor's ads that complied with the Court's ruling and indicated that no changes were to be made in the policy of selling trademarked keywords.
So where are we now? Has this case settled anything?
The reason the spotlight was on the Geico case is that it took place within a Federal Court District (Eastern Virginia) that is known informally as the "rocket docket" for the speed with which cases are resolved. Because of this, the Geico case was simply the first suit against Google on this issue to get to court. But there are other cases that will soon get to court and raise again the issue of Google's advertising policies regarding trademarks.
American Blind has sued Google in two Federal Districts (Northern California and Southern New York). Both cases are wending a slower path to trial than they would have on the "rocket docket."
In the Northern California case, American Blinds is suing Google on much the same issues as did Geico: does Google's sale of trademarked words violate the Lanham Act provisions of the Trademark Law? The Northern District is famously more liberal than many of its brethren and may well reach a different conclusion than the Eastern Virginia Court did in the Geico case. What happens then? Well, one of the major duties of the Supreme Court is to resolve differing decisions by the federal District Courts. We don't yet know John Roberts' opinion on the issue, but we probably will.
In the Southern New York case, American Blind and Wallpaper Factory have sued Google along with its search partners AOL and Netscape. There, the plaintiffs have claimed that Google -- by selling keyword-based advertising to competing retailers when Google users search on "American Blind" or "American Blinds" -- is violating the company's trademark. Moreover, that through its AdWords Keyword Suggestion Tool, Google actively and deliberately encourages American Blind's competitors to purchase as keywords both the American Blind marks and virtually every conceivable, though indistinguishable, iteration of those marks (e.g. a customer who is considering purchasing the keywords "American Blind" is encouraged also to purchase the keywords "american blinds", "american blinds and wallpapers," et cetera).
Another company that has a pending suit against Google on the same issues is AXA Group which is, like Geico, a giant insurance firm.
Earlier this year, the court upheld American Blind's rights to continue its case on claims of trademark infringement, unfair competition, contributory trademark infringement and contributory dilution. The court did, however, grant Google's motion to throw out American Blinds' claims of "tortious interference with prospective business advantage" and stated that its ruling expresses no opinion as to whether American Blind ultimately will prevail on the other claims.
In addition, JTH Tax versus Google was filed in the "rocket docket" this year. This case claims damages flowing from Google's alleged failure to comply with its own trademark infringement policy. In February 2005, the plaintiff learned that its trademark "Liberty Tax Service" appeared in the title of the online Google AdWords ad that directed users to another website called "Free Advice Center.com," which is a website unrelated to Liberty Tax Service. JTH Tax claims that Google did not respond to the demand to remove the link despite Google's trademark infringement policy, which states that ads containing third party trademarks will be taken down.
With all this pending litigation, we can't expect the issue to be definitively settled any time soon. And, of course, the French Courts have already weighed in with a ruling that Google's ad policies regarding trademarks violated French Law in the Louis Vuitton versus Google case.
One thing is sure: This issue will provide income for the legal profession for years to come.
In the meantime, in light of the Geico ruling, what, if anything, should SEM specialists and media planners do differently?
The answer: practically nothing.
Do be sure that client search ads don't include third party trademarks. That certainly is one key takeaway. While lawsuits so far have only named Google as a Defendant, no agency would want to be responsible for having a client be sued as a party to yet another Google lawsuit. And good search practice needs to include policing competitor's ads to be sure they don't infringe your clients' marks. Don't rely on Google to enforce this. Agencies must do it on behalf of clients.
But nothing about the Geico rulings changes the fact that buying competitors trademarked keywords remains a best practice for SEM. Indeed, anecdotal evidence indicates it may well be the most successful of all search tactics.
However, the wise Search marketer will prepare for the day when a Federal District Court may rule against Google and backup strategies will be needed.
Bob Heyman is Chief Search Officer at Mediasmith, where he helps clients with Paid Search, Organic Search Optimization (SEO) and Search Consulting on topics including Branded Search, keyword selection, best practices as well as trademark and legal issues. He is credited with having pioneered the agency side of Search Engine Marketing as a co-founder of early full service web agency Cybernautics which was acquired by USWeb in 1997. He is the co-author of Net Result.2 (New Riders) and The Auction App (McGraw Hill). His clients have included IBM, NEC, Ask Jeeves, Netscape, Intel SGI, Avon, Bristol Myers Squibb, REI, Time Warner, Sony, Macromedia and ABC. An Attorney, in a prior life as an Entertainment Lawyer he represented such stars as Maria Muldaur and Jefferson Starship.
If a company ever needed a reputation turnaround, that company was J.P. Morgan. As a result of its role in the American housing bubble and collapse, as well as by ignoring Bernie Madoff’s Ponzi scheme, the bank has paid a whopping 20 billion in fines. And Americans are still seething with anger at the banking industry. The corporate greed and moral turpitude that created the financial meltdown of 2008, as companies like J.P. Morgan essentially preyed on the public to make outlandish amounts of money, will never be forgotten…or will it?
According to YouGov's BrandIndex, J.P. Morgan's reputation improved significantly in 2013. Using its Buzz score methodology, which measures public perception of brands by gathering more than 2.5 million interviews a year, the company found that J.P. Morgan's reputation was the fourth-most improved in 2013. How can this be?
Although we can't accredit results entirely to one role within an extremely complex organization, the CMO certainly had much to do with it. In August 2012, J.P. Morgan hired Claire Huang, its first ever CMO. Not surprisingly, in May of that very same year, YouGov released reports that J.P. Morgan's reputation had nose-dived to its lowest level since 2008 (the year YouGov started measuring the firm's reputation).
Finding itself below Goldman Sachs on the reputation scale (the company Matt Taibbi famously dubbed a "vampire squid" in Rolling Stone) J.P. Morgan was in dire need of a brand refresh, likely bringing on Claire Huang to hold the reigns. And customer-centricity was evidently her primary focus. When discussing the company's revamp strategy with Adweek, Huang explained,
"Since I arrived at [JPMorgan Chase], we’ve worked to develop a digital center of excellence. I'm working closely with our CTO to use digital channels more to deepen relationships with customers who are using digital/social media. Digital media also creates the opportunity to leverage big data to deliver the right products to the right customers at the right time."
By developing meaningful customer relationships via digital channels, J.P. Morgan hoped to hit two targets: showing the humanity of the brand while developing deeper insights regarding customer needs. Once customer needs were established, J.P. Morgan better aligned its marketing messages to its audience, depicting itself as a problem solver of various financial challenges of everyday life, evident in its "So you can" commercials:
Even less product centered and entirely more customer focused was the company's commercial that ran during the 2012 Macy's Thanksgiving Day Parade:
Despite an effort that helped J.P. Morgan crawl out of reputation hell, Huang left the company and was replaced by Kristin Lemkau in early 2014 (maybe CMO tenures aren't increasing). Promoted internally, Lemkau will remain focused on consumer relationships and reputation management. As she told American Banker, "There is a lot of good that's going on in the company. We've got to do a better job of telling that story, and digital channels are going to be an important way to do that." At the onset, Lemkau finds herself in recovery mode, dealing with the now infamous J.P. Morgan Twitter debacle, in which the company invited users to tweet questions to vice chairman Jimmy Lee using the hashtag #AskJPM. You can imagine the onslaught of snarky tweets.
Clearly, J.P. Morgan is nowhere near out of the woods, but with customer-obsessed CMOs like Huang and Lemkau (and with more distance from 2008's financial meltdown), it may continue its rise in positive consumer perception.
Though the company was founded in 1997, it didn't rise to prominence until adopting the Android platform and releasing the HTC Dream (the first Android smartphone) in 2008, which was reviewed by TechRadar as a "stellar phone" that "points to a future when a phone is as flexible and useful as the PC on your desk." HTC followed up the Dream with a number of Android phone releases, including the extremely lucrative HTC Desire, and found itself in third place within the smartphone market (behind Apple and Samsung) in 2011.
Not only was the company booming financially, but it was also climbing the charts of consumer perception. As Simon Hill writes in Android Authority, "The brand was seen as a cool alternative to its competitors...With the cash piling up and brand awareness at an all-time high everything was looking pretty rosy for HTC, and then it went wrong." At the end of 2011, HTC began an ugly financial nosedive that has continued into 2014, as this chart form Pocket-Lint makes evident:
Of course, HTC's revenue rises and falls in accordance with product releases, but such an enduring decline has everyone asking, "Why has the company fallen so far off track?"
Obviously, a comprehensive answer to this question would examine multiple factors, but one reason is certainly clear: bad marketing. This issue is magnified (even made tragic) when considering the ad budget and marketing prowess of competitors like Samsung and Apple, as well as the fact that HTC actually makes brilliant devices. And the problem runs deep within HTC, as Cher Wang, the chairman and co-founder of the company, told Bloomberg, "To tell the truth, we never think marketing is that important -- this is really not very good."
In fact, in an interview with Bloomberg TV, Wang accredited the companies collapsing earnings to poor communication, explaining that HTC has "the best technology and the best product" but the company must "communicate better" with its consumers. Furthermore, Ben Ho, the company's CMO, told the Wall Street Journal that HTC "hasn't been loud enough" when marketing its innovations.
Attempting to solve this problem, HTC hired mega actor Robert Downey Jr. -- for $12 million, as part of a $1 billion ad campaign in 2013. And what did they do with Iron Man? Used him to make awkward jokes about the HTC acronym (i.e. HTC = Humongous Tinfoil Catamaran or Hipster Troll Carwash) in awkward advertisements that failed to mention products and risked irrelevance by running roughly six months after the company released its newest flagship phone, the HTC One:
In the early stages of 2014, hoping to bounce back from the questionable "HTChange" campaign, the company released a YouTube video in which Robert Downey Jr. promotes the well-reviewed HTC One (M8). Unfortunately, HTC continues to fail its products with poor creative. Warning: This half-ass effort from Downey Jr. is hard to watch.
Fortunately for HTC, there is a light on the horizon. In desperate need of a marketing makeover, the company has brought on someone who actually helped drive its losses. It recently hired previous CMO of Samsung, Paul Golden; an individual who "created and launched the highly successful Galaxy brand," as stated on his LinkedIn page. And HTC will be leaning heavily on the man behind the Galaxy brand to more effectively communicate the value of its products to consumers. Details regarding Golden's responsibilities are not yet available, but he will certainly have his hands full if he hopes to remedy HTC's marketing woes.
RadioShack's troubles are renowned. The Economist recently named the organization a "Dead brand walking." In fact, since 2007, the company's stock value has declined more than 95 percent. Consequently, RadioShack's chief executive, Joseph Magnacca, recently announced the future closing of up to 1,100 stores -- roughly one-fifth of its total. Financially speaking, according to The Economist, by the end of 2013, RadioShack was left with about "$180 million of cash on hand (down by two-thirds from the previous year-end) and a total debt of $614 million." To refinance its debt, RadioShack secured $835 million, buying itself some time. But how on earth does this iconic brand plan on turning things around?
Whether you love it or hate it, RadioShack has been part of the American retail world for roughly 93 years. Naturally, consumers are prone to nostalgia for the company, specifically those remembering the RadioShack of the '70s and '80s, which introduced many Americans to the world of tech. At the same time, unfortunately for the company, the RadioShack of the '70s and '80s is the RadioShack that comes to consumers' minds, not an electronics retailer that's relevant in the 21st century. It's likely that most consumers under the age of 25 have never set foot in a RadioShack. And the company isn't reaching this population online, as RadioShack's digital sales account for only about 1 percent of its total sales. Yikes...
To establish relevancy in a post-Apple world, the company hopes to capitalize on this consumer nostalgia while presenting a new, snazzier RadioShack to the world. And, in 2013, the company hired Jennifer Warren as CMO to execute this vision; a vision made clear in the following self-deprecating 2014 Super Bowl advertisement in which the voiceover states, "It's time for a new RadioShack."
The new RadioShack is evolving in accordance with consumer opinion. Discussing the brand makeover with Fast Company, Warren explained, "When we started talking to customers to see how to remake RadioShack, what we discovered was whether they loved us or hated us, they still had a lot of passion for the brand…they still had positive memories of RadioShack from the '80s as this place where inventors and makers got their start." And through its marketing efforts, the company is attempting to reignite the do-it-yourself culture of the past but with a modern twist. Because the sheer amount of tech innovations can convolute the industry for the average consumer, RadioShack is promoting a "do-it-together" culture of collaboration in which the brand helps customers discover what's possible with modern technology. The following video is certainly aimed at folks who prefer to "do-it-together":
And a marketing campaign that promotes modern solutions to consumer problems goes hand-in-hand with new product offerings and reinvigorated stores, as RadioShack is creating more space for innovative products stocked in redesigned stores:
Clearly, Warren and company are well on their way to refreshing the RadioShack brand, having taken positive steps toward increasing its relevance in 2014. But, one can't help but think it may be too late for the struggling company. What do you think? Is it too late for RadioShack to be saved?
Kyle Montero is a contributing editor at iMedia Connection.
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