Should You Target Your Competitors on Google?
I see it every week here in Brisbane. A business owner calls me up, frustrated because when they search for their own business name on Google, a rival’s ad pops up right at the top.
"Is that even legal?" they ask.
Yes, it’s legal. And if you aren't careful, it’s a quick way for your competitors to steal the phone calls that should have been yours. But there is a flip side: you can do the exact same thing to them.
In the world of Google Ads, targeting your competitors' brand names—known as "competitor bidding"—is a high-stakes strategy. Done right, it’s a shortcut to reaching people who are ready to buy. Done wrong, it’s a black hole that will suck your bank account dry while providing zero return on investment.
I’ve managed ads for everyone from electricians in Chermside to law firms in the CBD. I’ve seen this tactic double a company's leads, and I’ve seen it fail miserably. This guide is a deep dive into the numbers and the strategy behind poaching your competitors’ customers without losing your shirt.
The Logic: Why Bid on a Rival’s Name?
Think about how people search. If someone types "Jim’s Plumbing Brisbane" into Google, they aren't just browsing. They have a leaky tap or a burst pipe. They are high-intent customers.
By placing your ad on that search term, you are essentially standing outside your competitor’s shop front with a bigger, better sign saying, "We’re open, we’re cheaper, and we can be there in 20 minutes."
The Pros of This Strategy:
1. Highly Qualified Leads: These people are already looking for a service you provide. They aren't just researching "how to fix a tap"; they are looking for a professional. 2. Brand Awareness: Even if they don't click, they see your name. You’re telling the market you are a serious alternative to the "big guys." 3. Cheaper Than General Terms: Sometimes, bidding on a specific company name is actually cheaper than bidding on broad terms like "Plumber Brisbane," which every man and his dog is fighting over.The Cons (The Reality Check):
1. Low Quality Scores: Google knows you aren't Jim’s Plumbing. Because your website doesn't say "Jim’s Plumbing," Google will charge you more per click than they charge Jim. 2. Angry Competitors: If you start bidding on them, they will likely start bidding on you. It can spark a "bidding war" that drives up costs for everyone. 3. Lower Success Rates: Most people searching for a specific brand are looking for that brand. They might click your ad by mistake, realise you aren't who they wanted, and leave immediately. This is why you must fix your Google Ads tracking before you even think about this; otherwise, you won't know if those clicks are actually turning into money.The Three Types of Competitors to Target
Don't just go after everyone. That’s a waste of money. You need to be surgical. In my experience with Brisbane small businesses, we categorise targets into three buckets:
1. The "Goliaths"
These are the massive national franchises or the biggest players in town. They have huge marketing budgets and everyone knows their name. Why target them? Because they often have a reputation for being expensive or impersonal. If you can offer a "local, family-owned" alternative, you can peel away their customers.2. The "Failing" Competitors
Is there a business in your area that’s recently gone downhill? Maybe their reviews have tanked, or they’ve changed ownership and the service is rubbish now. Why target them? Customers are searching for them out of habit but are looking for a reason to switch. Your ad, highlighting your 5-star rating, is that reason.3. The "Direct Rivals"
These are the guys exactly like you. Same size, same suburbs, same services. Why target them? This is pure market share theft. It’s about being an option when the customer is still in the "comparison shopping" phase.How Much Will This Cost You?
Let’s talk brass tacks. You aren't doing this for fun; you're doing it for profit.
When you bid on your own name, you might pay $0.50 a click. When you bid on a competitor, you might pay $4.00 or $10.00. Why? Because Google rewards "relevance." Since your website isn't about your competitor, Google considers your ad less relevant and makes you pay a "tax" to show up.
Before you start, you need to stop wasting your money by setting a strict daily limit. I usually recommend that competitor bidding should never make up more than 10-15% of your total budget. It’s an add-on, not the main course.
The "Aggressive" vs. "Helpful" Approach
How you write your ad determines whether you get a lead or just an angry phone call from a rival lawyer.
The Aggressive Way (Risky)
Headline: "Better Than Jim’s Plumbing - 20% Off Today" The Result: You’ll get clicks, but you might also get a cease-and-desist letter. You cannot use a competitor’s trademarked name in your ad text in Australia, though you can bid on the keyword.The Strategic Way (Smart)
Headline: "Brisbane’s #1 Rated Plumber - Fast & Affordable" The Result: You aren't mentioning them by name, but you are appearing right above them. You are offering a clear alternative. When the customer sees your 500 five-star reviews next to the competitor’s 3-star rating, the choice is easy.What to Do When Someone Bids on YOU
It’s infuriating. You’ve worked hard to build your reputation in Morningside or North Lakes, and now some blow-in is trying to steal your customers.
Step 1: Don't Panic. Just because they are bidding on you doesn't mean they are winning. Often, they are just wasting their money on people who want you and only you.
Step 2: Bid on Your Own Name. This is called "Brand Defence." It sounds silly to pay for your own name, but it’s the cheapest traffic you’ll ever buy. It ensures you take up the top spot and keeps your competitor pushed down the page. If you let Google find your customers through smart bidding, it will naturally prioritise your brand because it knows those clicks are the most likely to result in a sale.
Step 3: Check Their Ad Copy. If they are using your business name in their actual ad text (the headline or description), they might be violating Google’s trademark policy. You can report this to Google and get their ad taken down.
The Data: How to Tell if It’s Working
Most business owners look at "clicks." Clicks don't pay the mortgage. You need to look at "Cost Per Lead."
If a normal lead costs you $30, and a competitor lead costs you $90, you have to ask: is that customer worth 3x more? Usually, the answer is no. Competitor leads often have a lower "close rate" because the person was already leaning towards someone else.
However, if you find that you’re closing these leads at a high rate, then spend as much as you can. It’s the fastest way to grow.
Common Mistakes That Kill Your Profit
1. Sending Traffic to Your Homepage: If someone searches for "Competitor A," don't just send them to your homepage. Send them to a page that explains why you are different. 2. Bidding on Names You Can't Beat: If your competitor is half your price and has better reviews, don't bid on them. You’re just paying to show people a better option than yourself. 3. Forgetting the "Negative Keywords": Make sure you aren't showing up for things like "[Competitor Name] login" or "[Competitor Name] jobs." You don't want to pay for their staff trying to log in or people looking for work.
A Real-World Example: The Brisbane Mechanic
We worked with a mechanic in the inner-city suburbs. There was a large, well-known chain nearby that was famous for overcharging. We started a campaign bidding on that chain's name.
Our ad headline was: "Tired of Dealership Prices? Local Service You Can Trust."
We spent about $400 a month on this specific tactic. It resulted in about 8-10 new customers every month. For a mechanic, where a customer might spend $500 for a service and stay with them for years, that $400 investment was a massive win.
Summary: Should You Do It?
Competitor bidding is a tool, not a magic wand.
Do it if: You have a clear advantage (better price, better reviews, faster service) and you have extra budget to play with.- Avoid it if: You are on a tight budget or your website doesn't clearly explain why you are the better choice.
Ready to grow your business? Contact Local Marketing Group today.