In the world of affiliate marketing, the relationship between a brand and its partners is built on a simple premise: “Find me customers I couldn’t reach on my own, and I’ll pay you a commission.” But there is a tactic that turns this “win-win” into a “win-lose” faster than any other: Brand Bidding.
At Conversion Lab, we often see brands frustrated by rising costs and affiliates confused by strict “no-bidding” clauses. Let’s pull back the curtain on what brand bidding is and why it’s the most contentious issue in our industry.
What is Brand Bidding?
Brand bidding occurs when an affiliate bids on a brand’s trademarked keywords—such as “Acme Shoes” or “Acme Shoes Discount Code”—in search engine auctions (Google Ads or Bing).
When a customer searches specifically for that brand, the affiliate’s ad appears at the very top. If the customer clicks that ad and makes a purchase, the affiliate earns a commission.
Why Brands Hate It: The “Unfair Tax”
To a brand manager, affiliate brand bidding isn’t “marketing”—it’s an unnecessary expense. Here are the three main reasons brands fight to keep it out of their programs:
- 1. The Cannibalization of “Free” Traffic: If a user is already typing your brand name into a search engine, they have high intent to buy from you. They would likely have clicked your organic (free) link anyway. When an affiliate intercepts that click, the brand pays a commission for a customer they already had.
- 2. Artificially Inflated CPCs: Search auctions work on competition. When your own affiliates bid against you for your name, they drive up the Cost-Per-Click (CPC). The brand ends up paying more for its own keywords because its “partners” are driving up the price.
- 3. Loss of Messaging Control: Brands spend millions on their image. An affiliate might use outdated logos, “clickbaity” headlines, or fake discount claims (e.g., “70% Off Everything!”) just to get the click, which can mislead customers and damage brand trust.
The Affiliate Perspective: The Temptation of “Easy” Money
For affiliates, brand bidding is tempting because it’s incredibly effective. Branded keywords have much higher conversion rates than generic terms like “running shoes.” By bidding on the brand name, an affiliate is essentially fishing where the fish are already jumping into the boat.
However, this is a short-sighted strategy. Most modern affiliate networks use automated monitoring tools to catch this behavior. Once caught, affiliates face:
- Reversed Commissions: The brand will refuse to pay for any sales generated via brand bidding.
- Program Expulsion: Most brands have a “zero tolerance” policy, leading to a permanent ban.
The Path Forward: Incremental Value
The goal of a healthy affiliate partnership is incrementality—bringing in sales that would not have happened otherwise.
We encourage our affiliates to focus on “long-tail” keywords, review content, and social media influence. By reaching customers in the “discovery” phase rather than the “final click” phase, affiliates provide genuine value that brands are more than happy to pay for.