Thursday, September 23, 2010

Am I just naive? Or is this type of stuff just 'par for the course'?

One of the things I really enjoy about the early stage technology scene is its collaborative nature. Companies routinely compete and co-operate and "frenemies" co-exist pretty happily.
Lots of people give freely of their time and expertise understanding that we are all part of a larger eco-system with many mutual dependencies.
There is a time to compete really strongly - and this is normally done by being faster and smarter.

I was shocked recently by the behaviour of one of MyBuilder's competitors - namely MyHammer.
This German company, with operations now in the UK has behaved in a way that is frankly very difficult to understand or justify.
[I need to declare a direct interest in this matter as a board member and investor in MyBuilder]
Firstly, MyHammer registered the MyBuilder trademark in the UK - back in June 2008, AFTER MyBuilder had launched their site in May 2008. Clearly this was an 'own goal' on MyBuilder's part and is a lesson to all startups to register your brand as soon as possible.

Then,recently, MyHammer initiated a PPC campaign / new affiliate site, my_builder.com (ie my underscore builder),  just when MyBuilder's TV advertising campaign launched. See screen grabs below - 

Following a strenuous complaint by MyBuilder, MyHammer agreed to take down the offending site - no doubt having hoovered up a decent number of potential customers. I would also hope that they would hand back to MyBuilder their brand registration and URL - the goodwill in which has been built by MyBuilder at considerable cost and over a number of years.

I'm interested in what people think about such practices and how widespread they are. Certainly there is no board that I sit on which would sanction such an approach to competition.

This is the TV commercial which is helping to build the MyBuilder brand:

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  1. Sadly 'par of the course...

    Its a sad side of the business, and something that I don't agree with.

    Seems MyBuilder was hit by quite a severe case of this though, partly due to the lack of trademark and domain variations for the brand.

    I was hit by this recently in a smaller way for one of the start-ups I'm involved in. I'm sure most people have suffered a similar situation to this one, where a competitor noticed the press I was generating and jumps on it by buying Adwords for the company name (MouseTrace.com).

    Not much can be done about it so just need to accept it and make sure that your service is better (And jump on any valuable trademarks and variations of domain names!).


  2. kind of surprised that you are surprised by this.

    on the scale of business depravity/dirty tricks this is on the low-ish end

    there are a lot of scumbags out there who have no respect, decency or morales and would rather an easy buck than piece of mind.

    capitalism takes no prisoners and there will always be someone whose prepared to do descend to unpalatable depths to eat your lunch.

    i dont like it, nor agree with it, but in business we must at least accept it.

    you reap what you sow and these kind of cowboys have it coming to them sooner or later

  3. It happens all the time. It happened to one of my former investments. They have a Google PR9 site and are domiciled in Sweden. Squatters in the US and South Korea acquired URL variations of their site, acquiring and monetizing significant traffic intended for my company's site. We attempted to persuade and negotiate to no avail.

    There are a variety of laws and process for recourse which differ by geography (http://bit.ly/cQLqLb).

    Lesson learned. Be hyper diligent about your brand and TM upfront.

  4. This sort of practice was quite common during the Dotcom boom (1999/2000). Suddenly, there was a new way of doing business over the Internet and laws and rules of behaviour hadn't been established and there was a bit of a free-for- all. Cybersquatting is a good example of this. This practice was rife but now there are laws / rules and mechanism to deal with this.

    As such, I am surprised at the behaviour of myhammer as this sort of commercial practice whilst common during the dotcom days seems to have subsided. This is mainly because (i) companies realise that this is an unnacceptable business practice, and (ii) the law has caught up and allows right's holders to do something about this.

    There are a number of options open to mybuilder under trade mark law (assuming mybuilder has rights in the name) and consumer law (if the myhammer site is misleading). As always with law, the options you have depend on the particular circumstances but coming down hard on such practices worked 10 years ago and perhaps need to be adopted again.

  5. Anonymous11:22 pm

    Par for the course and not something new.

    Invest in protecting your brand, and bid on all derivations of My Builder.

    Start bidding on their brand name and other competitors too.

    Generally CPAs are much lower on competitor brands than on traditional block buster key words.