The Low Hanging Fruit of Google Shopping

The starting point…a Product feed

As an eCommerce merchant, you know that at a minimum, a product feed is needed for Google Shopping (and other shopping channels). Now there are ‘as is’ product feeds that are simply delivered from A to B i.e. from your eCommerce website platform to the Merchant Center, and then there are product feeds like those built by Feedonomics that not only move your data from A to B, but also optimize the product data so that the data will be much more relevant to search queries. Optimized product feeds out-perform simple feeds, and result in better performance: more impressions, more clicks, more conversions/sales and higher return on ad spend (ROAS).

But…

with that said, an optimized feed in isolation, will not necessarily generate great results.

There is a three-legged formula to success:

1. A highly optimized product feed (see “the starting point” above)
2. A well thought through campaign bid strategy & structure (AdWords, Bing etc.)
3. 1 & 2 aligned as close as possible

If these three are not followed, your likelihood of success will be reduced.

Our experience…

We have found it common that both agencies and end users, create flawed and under-performing Google AdWords shopping campaigns. A well optimized feed will typically lift performance over a poor feed BUT, if the shopping campaign is poorly built, you are not going to achieve full potential.

Shopping is different…

Google Shopping is a whole different beast to Google text campaigns, and the campaign strategies used in text ads, do not always translate to shopping. People often overlook or misunderstand the basic structures & settings for shopping, resulting in poor performing campaigns.

To better serve our clients, we have created a quick and practical overview, which we call the ‘low hanging fruit of Google shopping’. This overview should take about 10 minutes to review.

To be clear…

This overview simply outlines basic structures and a minimal understanding to success, and does not address advanced campaign strategy.

Let’s begin…

Guideline # 1 – Keep it simple (at least initially)

• We suggest keeping campaign structure simple until there is enough statistically reliable data (obtained from the dimensions tab) to allow you to segment your data meaningfully, and to identify trend outliers.
• Further, keeping campaign structure simple (i.e. less segmentation) initially allows you to collect performance data quicker, which in turn will allow you to make more informed decisions sooner.
• Another benefit of keeping structure simple initially, is based on the way Google selects products to be displayed to a search query. Amongst other criteria, Google looks for the best product performers in deciding which products to display. If the product has no or little performance history, Google will look at the performance data of the group that the product resides in, and will give preference to a product within a group with better performance data i.e. high performers in the group may assist the low performers in the group. A less segmented campaign will typically have more data than a campaign segmented into many ad groups and product groups. So, if a product has little or no performance data, it is better to have less segmentation, and the result will be more products listed and potentially lower cost per clicks.
• As a general rule, campaign structure should be built to achieve:
  • Simplicity – for all the reasons mentioned
  • Clarity – use the settings/options for their intended purposes (see guideline 3)
  • Ease of management – the more complex the campaign structure, the more diligence required to manage.

Guideline # 2 – Data, Data, Data – Dimensions Tab (it’s your best friend, use it)

• The Dimensions tab is where you slice and dice your performance data.
• You can analyze data relating to performance of product types, brands, individual products and many other data points.
• It is very important to identify outliers – top performers, poor performers, trends etc.
• Objective: Using the data => make campaign structure adjustments, modifications => high/low performance segmentation => re-allocate ad spend from poor to top performers => improve return
• Example: assuming your campaigns are initially segmented by ‘product type’, then analyze brand Check the brand data for outliers i.e. any brands within the brands that may perform differently. If you do find outliers, then create further segmentation within brands i.e. branded ad groups within brand campaigns. Once again, by adjusting bids from poorer to better performing segments, you will improve overall returns.
• Apply the same segmentation exercise to other possible segments and individual product id’s. Review the data from the dimensions tab, and modify accordingly.

Guideline # 3 – understanding the benefits of the different campaign levels and settings/options and when to use them.

Guideline # 4 * – Simple “bid optimization” strategy

This strategy helps you to optimize campaign level bids, using the campaign delivery method, budget, and “hour of the day” performance data.

• One of the most overlooked settings is the Campaign Delivery Method – many merchants leave this setting at ‘standard delivery’, whereby Google allocates your budget evenly throughout the day, displaying your ads evenly throughout the day as well.
• While this strategy may keep ads showing throughout the entire day (sporadically), it provides no insight into accomplishing the optimal balance between maximizing traffic and minimizing bids.
• The problem with the standard delivery method is that it “masks” real demand for your ads. If there is more demand for your products than your daily budget allows, you will not be able to gather the “true” demand data to analyze optimal bid for your budget and ultimately effect better performance.
• Why? – by keeping the delivery method at standard, Google is modulating your traffic, and you will never know the true demand (traffic, impressions, clicks) for your products.
• If you use the campaign delivery method ‘Accelerated’, chances are, the budget will be used much earlier in the day due to higher real-time demand. That’s ok! There are two benefits (1) you know that the demand is greater than you budget, so you can make the decision to lower your bids to maximize your “up” time and (2), now you have “true” data and insight into true product potential.

Example:

• let’s say you set up a new campaign with a $500 daily budget, and a random max CPC bid of $1.00 (you don’t really know what this starting bid should be).
• Set the delivery method to accelerated and watch the data
• After a few days accumulating data, using the dimensions tab, look at the hour of the day that your budget ran out. If it ran out at 11am, then you can deduce that there is a greater demand for your products than your budget can meet at the current bid.

• Now play with the bid amount. Lower the bid to say $0.75. The next day you check the hour of the day your budget ran out and you see it ran out at 3pm
• You continue with this process until your budget just lasts the 24 hours.
• If this results in dropping bids by 50c whilst keeping your budget at $500, you would have produced 2 x more clicks for the same budget, which is 2 x more conversions and 2 x greater return on ad spend.

• Furthermore, once you improve results (ROAS), it is an easier decision to commit a bigger budget and the process starts all over again, balancing budget and Max CPC with desired ROAS.
• If you are unable to spend the budget, it means:
  • you have probably gone too far in the wrong direction in lowering bids, and your ads are not showing, or
  • your products do not have much online demand

Summary

The Golden Rules are:

1. Simple

initially, keep your campaign structure broad as it:

-is easier to manage

-allows you to collect valuable aggregate level performance data quicker.

Learn about your product performance faster and subsequently optimize your bid strategy earlier.

2. Data

use the dimensions tab to analyze your performance data. Slice and dice and take the learnings through to your campaigns.

Only get granular & build out campaigns when the data (or experience) tells you to do so.

3. Structure

Use the available campaign tiers/structure according to the functionality they offer. If you are not using the functionality they offer, then consider whether it is necessary.

4. Bid strategy & accelerated delivery

Never rely on the campaign’s daily budget to control your spend, use it only as a backstop. Make use of the campaigns accelerated delivery method in conjunction with the ‘hour of the day’ report in the Dimensions tab to achieve the optimal Max CPC bid.

If you apply these rules, you will be taking advantage of the low hanging fruit, the easy wins, to find success in Google Shopping. These are the basics, the fundamentals, and understanding them paves the wave for advanced campaign strategies, but more about that another time.