Good, well targeted keywords are big business and can generate significant amounts of convertible traffic within a well structured internet marketing campaign. But how open a market should it be and is it important for businesses to have preferential treatment when it comes to bidding on their own trademarked terms?
On Tuesday the European Court of Justice heard an appeal from Google after they were ordered to pay Louis Vuitton $250,000 in 2005 over a dispute concerning the use of their trademarked words as keywords by other companies. Louis Vuitton sell high-end luxury goods such as jewellery, luggage and handbags which they sell in traditional retail outlets rather than via the internet. Other companies were bidding on keywords such at ‘vuitton’ and then using the traffic generated by search engines to sell rival products and even counterfeit goods that resembled original Loius Vuitton styles.
Louis Vuitton’ lawyer Patrice de Cande, told the court on Tuesday that ‘Google’s advertisement activities have given companies which sell fake products unprecedented visibility beyond their wildest dreams.’
A spokesperson for Google said, ‘AdWords helps users find the information they are looking for and provides advertisers with an efficient way to reach their audiences. Google believes that it has not infringed the claimants’ trademark rights and we look forward to the outcome of the cases.’
This practise has been around in the US since 2004 but Google has only been used in the UK and Ireland since May last year. The important question for Google must be this: Google claims to be user led. The idea being that searchers are looking for something and the closer a company can get to giving the consumer what it wants (and then some) the higher a sites ranking. The higher the ranking the more visitors a site is rewarded with. And so on, in a never ending cycle of supply and demand. However, if a consumer is looking for Louis Vuitton and finds a rival company, is the consumer being best served? If they are not looking for luxury bags or fake Louis Vuitton then what is the purpose of Google allowing these sites to rank well? In theory, if they are not throwing up what the consumer wants then these sites will not rank well.
In June last year, a French court ordered auction site eBay to pay 40m Euros to LVMH for allowing online auctions of fake copies of its goods. LVMH had said eBay’s French site had not done enough to stop the sale of counterfeit bags and perfumes, under brands including Louis Vuitton, Christian Dior and Givenchy.
There is also the question of morality? To what extent, if any, should Google be the arbitrator of morals within ecommerce? Something does not feel quite ethical about a company using a rival’s trademarked term to sell its own goods. Should Google be concerned about this? Google sometimes does take a stand, for example in June 2007 it banned Adwords adverts for student essay writing services which was very much welcomed by the Universities. Also, some terms related to gambling and hacking are not allowed either.
The outcome of the appeal is not expected to be announced until next year. We will be watching the outcome with interest.