Cyber Squatting - Assess the brand impact

Following up on my recent posting about cyber squatting, I though I would cover what this means from a brand's perspective. So, for the purposes of this posts let's assume you have a domain registered by a unwanted squatter with a name that resembles your brand... what is the impact of this?

Well, this really depends upon several things:

1. How close to your brand is the domain that is registered?
If it uses the exact name (and correct spelling) then there's obviously a strong chance its your organisation that has been targeted. If it is a common top level domain (TLD), then expect that many users will type this URL into their browser, an action known as "domain dipping". If then fair to assume some disappointment with your own brand if they don't find your site.

2. What does this domain offer?
Is there an actual website there, if so what does it say or do? Are they attempting to pass themselves off as your brand? Do they sell products, especially competitive ones (or even your own) if they have an eCommerce or affiliate setup?
Note:
A site that pretends to be yours is an obvious phishing scam candidate and the negative publicity and reputational risk could be huge! Even if this isn't a phishing attempt, are you really happy for someone to make money from your brand without your consent and without your quality safeguards?
(No, I didn't think so)

3. Are they promoting the domain?
If they are trying, through fair means or foul, to promote the site... then these efforts could conflict with your own marketing and PR activity. Check with you aligned online marketing agency (or even just type in "link[site URL]" into Google to see who's linking to this site).
Oh and don't get me started on what this means for your SEO efforts...

My main advice on this matter is if you are in any doubt as to your legal postion on this.... consult your lawyers. You may have a clear case of misrepresentation or other avenues to claim back this domain (or at least stop it doing what it is doing). But regardless, make sure you fully understand and communicate the impact that that the cyber squatter is having on your brand.