In a webmaster hangout yesterday at the 1 minute 22 second mark, someone asked if they own bluewidgets.com and then a competitor or two own mybluewidgets.com or ibluewidgets.com and other similar domain names, can it hurt their rankings? Can the similar domain name have an impact on Google confusing signals and such?
John Mueller of Google immediately said no, it does not. Google treats each domain name as unique even if there is only a single letter difference.
John said "If they just look similar we we still see them as separate URLs." "So that there wouldn't be any kind of algorithmic overlap that our algorithms would say well sounds similar maybe they mean the other one. Either it's the correct domain name or it's not the correct domain name," he added.
Here is the video embed:
Now, if people are linking more to your competitors domain name, even if it is out of confusion, that does play a roll. But there are no algorithms that confuse domain names, unless you are using canonicals or redirects. Either way, having domain names or brand names that are similar to others is not always the best marketing strategy.
Forum discussion at YouTube.