Imagine a customer walking into your competitor's store. Just before they open the door, you tap them on the shoulder and say, "Hey, we are actually open later and charge less."
In the physical world, you would get punched. In Google Ads, this is perfectly legal. It is called Competitor Bidding.
But just because you can do it, doesn't mean you should. It is expensive, aggressive, and can start a bidding war. Here is the field manual for when to attack.
The Decision Matrix: To Bid or Not to Bid?
Don't just attack everyone. Use this matrix to pick your battles.
High Budget
High Budget
Low Budget
Low Budget
The Rules of Engagement (Trademark Law)
If you put "Bob's Plumbing" in your headline, Google will disapprove your ad for Trademark Violation. If you simply bid on the keyword "Bob's Plumbing" but write a generic ad, you are safe.
Writing the "Conquest" Ad Copy
Since you can't use their name, you must allude to them. Be the "Alternative."
Why Your Quality Score Will Be Terrible (And Why That's OK)
Google expects relevance. If someone searches "Bob's," and you show "Mike's," that is irrelevant. Your Quality Score will be a 1/10 or 2/10.
This means you will pay a premium for these clicks (often $15-$30). However, the conversion rate is often very high because the user is already in buying mode. They aren't researching; they are looking for a phone number.
Conclusion
Competitor bidding is not for beginners. It burns budget fast.
But if you have maxed out your other keywords and need to grow, stealing your rival's lunch is the next logical step. Just keep it "friendly" (and legal).