Brand keyword bidding and its impact on conversion rate

When choosing keywords for your paid search engine marketing campaign, it’s important to give careful thought to the use of corporate / brand keywords, or keywords that support your company’s brand name. Some advertisers believe that bidding on their own brand terms is a waste of money. The reason being that the user has decided to convert with the brand he searched for and it would make more sense if he did it by clicking on the natural listings. Brand keywords almost always appear at the top of the natural listings, (but not always). So why waste valuable budget on paid search engine marketing around your brand keywords?
By not bidding on your brand, you are missing a whole lot of traffic & conversions:
A brand keyword always outperforms non-brand and competitive keywords because the searcher is looking for the brand.
Because the conversion rate is so high, branded terms delivered a much higher ROI than other terms, even competitive brand keywords also have good ROI, but they usually come at a higher price.
Make sure you protect your brand by bidding on it because competitors will not miss out an opportunity to bid on your brand and steal your traffic. Bidding on brand keywords is your best line of defense against brand theft.
Brand keywords will have very high click through rates (CTR); therefore, brand keywords will have lower average CPC, and will result in very low CPLs.
Bidding on your brand keywords reduces the possibility of the more expensive generic ad appearing for brand + generic searches as a result of Google’s broad match algorithm. So if you not bidding on brand terms you will end up paying more as you ad will appear for generic terms.
For example - users searching for Club Mahindra resorts will see ads triggered for resorts, which will be expensive.
Brands clearly are powerful keywords, not only for the brand owner, but also for the channel.
In addition, repeated clicks on the ads generated by the very same search terms were more likely to come from brand keywords. This happens because after a bit of searching around, viewers are more likely to return to make their purchase by using a brand keyword. For this reason, it’s crucial that you’re bidding on your brand name and all its variants.
Always check for competitive advertisers on your brand terms. And make sure to bid on those competitive brand keywords.
To conclude, it’s crucial to have a wide variety of strong, relevant brand keywords in your paid search engine marketing account live at all times.

http://blogs.position2.com/bidding-on-brand-keywords