My web agency is creating a variety of SEM PPC campaigns in the search networks, and I'm thinking of exploring the idea of bidding on keywords for my competitors' company names. Of course I wouldn't include their brand names in my copy, but I would leverage their keywords as terms to position my company. I'd be looking to bid on roughly ~400 keywords, therefore ~400 creative, ad, marketing, web, digital, performance agencies. I haven't strategized ad copy and landing page direction yet, simply exploring the concept first. What are the pros and cons of this strategy from your point of view?
This is totally a legitimate strategy. If you would like to take this strategy to the next level, you can also create a page that reviews your service vs. your competitor, and then you can use the competitors content in your ad, and frame it as a review.
Just be aware, that if you have big competitors who are lawsuit happy, no matter what you do, you are at risk of them getting annoying and dirty. I'd recommend being very respectful (if they are bigger).