What are best practices for using competitor names in keyword?

Using trademarked terms and protected words and phrases is a clear violation of the store guidelines. The same goes for irrelevant words and terms and the name of competing apps. The store might reject your app or update. Your competitors will not know what keywords you have added in your keyword field, but might report a trademark infringement towards your use of their name as a keyword in fields like the title, subtitle, product description and even screenshots. 

The best advice is to focus on relevant keywords that have medium to high search volume, and where you have a chance of ranking as number 1-5. Target your competitor's keywords in your paid user acquisition instead. 

There are a few things you should keep in mind if you want to use trademarks in the Title or Subtitle (visible parts):

• It depends on the jurisdiction; some trademarks can be used outside of the applicable areas.
• Appropriate usage – if you created an app specifically for the “brand” company. You can use phrases like “for use with”, “made for” etc. (i.e. Cool Fonts For Instagram). You might need to prove that it was created specifically for this “brand”.

What could happen?

• They might reject your update so you can change your title or subtitle. 
• You might receive a complaint about using TM. But you can always change it back.

If you want to use it in the Keyword field the worst thing that could happen, you won’t be ranking for it. You can also try using misspellings there (i.e. offerup, offer up, oferup, ofer up etc.).

Oh, and you shouldn’t forget about ASA (Apple Search Ads). This way you can target your competitors’ keywords.

If you didn't get into the top 3 for the TM, usually it's not worth it. If it's not a game. For e.g. users that search for the League of Legends (it' just an example) might try other MOBA games.

Another exception is if it's a brand name that was created out of some general terms (i.e. Nextdoor). They might be used unintentionally. Who knows you might be already using them.

Be creative!