1. Please The Feed

Your Google Shopping product data feed is the most important element of a healthy PLA campaign. It tells Google what information to use for your product ads and helps Google determine where your ads should appear in search results.

It’s better to err on the side of providing too much relevant information than not providing enough. Give Google as many clues as possible to make a relevant ad impression on your target consumer.

Improve your feed in three steps:

• Follow Google’s feed specifications. If you are not proficient with updating and increasing the quality of your data feed to follow Google’s rules, you’ll have trouble competing on Google Shopping, and you’re definitely going to have trouble validating your ad groups. Make sure you understand the technical ability required to get the most out of this channel.
• Send your feed to Google daily. Google favors merchants who send reliable, consistent data signals. If you aren’t sending your feed regularly, there’s a definite chance your information is dated or incorrect.
• Regularly check your Google Merchant Center to make sure your data feed is processing and error free. You can view your searchable products through the Google Merchant Center Dashboard:

You can find out all sorts of information on your Data Feed in the Google Merchant Center dash board, and the Data Quality tab on the left can tell you how healthy your product information is in Google’s eyes.

Additionally, be sure none of your products are restricted for Google Shopping or have product information which Google might flag as restricted. (You can view Google Shopping’s restricted products here.)

2. Suppress Poor Performing Products

You can use negative keywords to limit what terms your products show up for in search, but it’s also important to have an ad group in your product listing ads campaign which is designed to limit exposure to products which convert poorly or have a very high cost of sale (COS).

You can use your All Products ad groups for product suppressions, or you can create a new ad group for products you want to down bid.

The ad group for products you want to suppress should be bid lower than your other ad groups so you aren’t wasting ad spend on products which aren’t selling.

Since PLAs work on a bidding hierarchy, all you need to do to suppress a product is remove it from its current category (e.g., product, brand, etc.) and put it in the new ad group with the lower bid.

Products which aren’t converting are eating into your daily budget — funds which you could be using to promote products that do sell well.

3. Increase Bids On Best Sellers

If you have products that sell well on your site or specifically convert well on Google Shopping, you should increase your bids on them.

Identify which products convert well in Analytics, then create an ad group specific to those top performers. You can use your AdWords label column to identify these products and create an ad group with that same label (e.g. “best”).

Using a best seller ad group with higher bids will increase exposure to products which already sell. More eyeballs on products which sell well means more sales for you.

If you want to take your ad groups to the next level, you can change ad display frequency and bidding amounts for different times and days of the week.

We just released a guide on Product Listing Ads which outlines how to change ads based on day of the week metrics. It also covers 35 other PLA topics & strategies, if you want to continue learning after reading this article.

4. Accelerate

Google actually has an “Accelerated” Delivery Method in the Settings section. This is at the bottom of the settings page, under the “Bidding and budget” tab:

According to Google, the Standard setting will “show ads evenly over time,” while the Accelerated setting will “show ads more quickly until budget is reached.”

In the first option, Google will show your ads throughout the day periodically. If you choose Accelerated, Google will show as many of your ads as possible until you hit your daily budget, so make sure you watch your campaigns carefully after making the switch and adjust your budget accordingly.

We recommend only experimenting with this option if you have a good amount of recent positive campaign data already.

5. Avoid Bidding By Margin

Grouping products by how much you make per sale sounds like a good idea because you can bid up on your high-margin products. But if that product doesn’t sell on Google Shopping, who cares what the margin is?

Your ad groups should be set up so that similar products are grouped together. This will allow you to identify which product groups are performing well (or not), and change bids there.

If your Google Shopping campaign is new, a good place to start is by creating ad groups based on brand or category. Once the ads have been running long enough to gather some good data, you’ll have an idea of how different products convert on Google and adjust bids for that group accordingly. The idea is to collect data on what types of products do well for you on Google Shopping, then increase bids on those over time.

Bidding by margin hurts conversions because you are making an inaccurate assumption about product performance. Let the data speak for itself and optimize conversions from there for the biggest incremental increase to conversions and profit.

If you’re interested in more PLA tips make sure you check out our definitive guide on how to manage Product Listing Ads.

Last week, we talked to Jon Venverloh (agency expert) and Vineet Buch (product manager) from the Google Shopping team about latest changes to the program and what to expect in the future.

Adoption Issues

One of the biggest issues Google admits is helping retailers understand the benefits of a paid Google Shopping. Instead of trying to backwards-engineer a little known product data algorithm, Google says, retailers now have a more democratic auction-based platform to drive more consistent traffic to their webstores.

It makes sense. Google consistently ranked as the #1 source of traffic and in the top 2 for conversions for more than two years. They banked on this fact by switching to a paid model, and retailers, now with the power to drive more traffic to high-converting products, are benefiting at large.

New Shopping Ad Formats Being Tested Constantly

Changes to the Google Shopping platform are constant, such as this standalone product page for a Bane Mask:

Check it out yourself here.

One thing to note on this page is that Google is continuing to push the ‘Add to Shopping List’ feature, which hints at the more comprehensive ecommerce experience that Google is going after.

Changes To The Merchant Experience

Jon and Vineet mentioned a more streamlined merchant experience that will be hitting the Google Merchant Center shortly to help minimize confusion among retailers alternating between using the Google Merchant Center and Google Adwords.

“PLAs are complicated. Thinking about bidding, budgets, and strategy isn’t intuitive, so we need to help remove friction from the current management process,” said Jon.

On top of that, better checks, balances and product data suggestions will be slowly rolled out to the Google Merchant Center to give merchants more insight into what Google is looking for when it wants better data.

Also, over time, the automation that has been built out in the AdWords tool will slowly be added on to Product Listing Ads to further streamline the experience.

Finally, Jon reminded us about the new Product Listing Ads product target that was rolled out a few weeks ago which allows retailers to target a specific product ID or SKU, the most granular product target in Product Listing Ads to date.

The (Official) Change Is Coming

The official switch to a paid model will happen sometime in October, when the last bits of free Google Product Search traffic will dry up.

Retailers should prepare their budgets for this change and also start to look at increasing their Google Shopping budgets to account for the increased traffic and conversions that will start to build from now until the Holidays.

Product Data A Focal Point

Google is also constantly looking to enhance the data they get not just from retailers, but from data partners as well. Edgenet is one of these partners that works with manufacturers to get Google more complete product information.

More product data = more informed consumers = more confident purchasing decisions = more conversions.

Another Interesting Google Shopping Vertical: Search As You Type

The technology that powers Google Shopping is now being used to help retailers with their site search. Google’s new ‘Search As You Type’ service is a pilot program that leverages both Google’s knowledge on common search irregularities (such as geans vs jeans) and helps shoppers find the right products faster. A surefire way to increase conversions.

More info on the program can be seen in their announcement post here and the signup page here.

Expect Mobile To Explode In 2013

Google Shopping has been seeing large increases in traffic from mobile devices and Vineet encouraged retailers to look at solutions for optimizing their site for mobile.

With technology soon to be hitting the market that will allow consumers to purchase from retailers without entering a 12 digit credit card number with their thumbs, Vineet likened the mobile market today to that of the desktop market when online retail began generating steam 5 – 10 years ago.

The ability of the mobile market to inject billions of dollars into the ecommerce market will soon be here, and those not prepared will miss out. In fact, if you don’t have a mobile-optimized site, you’re probably missing out on a pretty sizeable chunk of sales already. It’s only going to grow.

More Information On Google Shopping To Be Discussed At SMX

On day 3 of SMX East 2012, our own David Weichel will be joining Frank Kochenash from Mercent and Matthew Mierzejewski from RKG to discuss Google Shopping’s switch to a paid model and how retailers and advertisers can best take advantage of it.

At The End Of The Day: It’s All About The Consumer

Though we talked mostly about changes for merchants, it’s clear that Google has their targets set on enhancing the customer experience on Google Shopping to rival that presented by Amazon.

Some of the new product pages have dropped hints at the direction of this experience, but Google was tight lipped as usual about when and how those changes to the consumer side of Google Shopping will roll out.

One thing is for sure, there’s lots of innovation on the horizon for Google’s Shopping platform during Q4 and 2013. Stay tuned to see how this one develops.

Google is trying to combat that growing percentage with more sustainable consumer-focused ecommerce initiatives, centered around local availability, the Google Wallet, Google Shopping, and Google Trusted Stores.

The following is an analysis of Google’s recent ecommerce developments.

Google Shopping Testing New Detail Pages

In a recent webinar with Jon Venverloh, Google Shopping’s Senior Product Manager, he went over some new Google Shopping comparison pages. Check it out:

I spy:

1. A ‘Shop now’ button that looks extremely similar to a ‘Buy now’ or ‘add to cart’ button on any ecommerce site.
2. A buy box that Sports Basement owns.
3. The true comparison page for that product above the Sports Basement callout which reads ‘Shop Online – 21 results’
4. More callouts for local marketing under the Sports Basement buy box.
5. Greater integration of product reviews, Google+, and an ‘add to list’ feature that really bring this page together.

The big missing piece is the actual shopping cart software. My hunch: Google may allow users to ‘buy products now’ straight from Google Shopping with one click, but only from retailers that are enrolled in the Google Trusted Stores program.

Why?

Google knows Amazon’s dominance comes from their focus on the customer. Google Trusted Stores is Google’s customer service lantern into ecommerce companies. I think many of us also know the ease in which we can shop and buy with one click buying on Amazon.

Take away hoops for the user to jump through (comparison pages, go to the merchants site, add that item to the cart, checkout) and make the shopping experience focused around a Google Wallet account, Google+ for sharing and a one-click purchase option for Google Trusted Stores, you’re going to end up increasing conversions for the merchants using those programs. Higher conversions also gives Google more room to charge the merchants that list on their program.

More updates from a recent developer conference on Google’s plans to push the wallet to new users here. You can tell this is a hot item for all tech companies – getting users to adopt online payment methods to easily make purchases without entering a 12 digit card number on a desktop or touch screen.

Once these systems start integrating more seamlessly with desktop and mobile, the ecommerce market is going to see a big uptick.

Google Trusted Stores Markup Now In Comparison Pages

Our lead account manager (Jeff Coleman) found this Google Trusted Stores callout on a Google Shopping comparison page the other day:

Check it out for yourself here.

Google also recently released a G+ Hangout on the Google Trusted Stores program that you can check out in the video below.

What About Local Availability?

We’ve heard rumors of Amazon to soon compete with DHL and Fedex. We expect Google to do something similar but on a local fulfillment level, but their timeline to making a service like this public is likely much farther in the future than Amazon. Their intricate Google Local Places program, cars that can be driven with no one inside, and Google Store Tours, you can begin to see a faint outline of Google’s direction in terms of fulfillment.

One thing Amazon knows is that proper fulfillment is extremely complicated but extremely important to the customer. Google knows this and will either rely on its Trusted Stores partners with fulfillment duties or offer a ‘Fulfillment by Google’ style service to rival Amazon’s in order to help merchants fulfill orders more quickly and effectively.

The stars are beginning to align for Google to take a more direct role in the fulfillment process of ecommerce. Some think this type of system is a must for Google to compete head on with Amazon.

Bringing It All Together

Google has a real uphill battle to transverse if they want to start eating away at that 30% product search market share that Amazon has. They seem to have the right ideas.

However, this is going to be a risky growth period for them which will define their adult years as an ecommerce company. With the transition to Google Shopping paid, there’s been numerous product gaps in their catalog that they’ve been scrambling to fix.

Amazon must be sitting back and enjoying the scramble, knowing that some of those users will go to Amazon to continue their search. But Google does have the potential to compete head on with Amazon in ecommerce and start gaining market share if they can convince all of their users – not just users that are shopping online – that Google provides the most rich product data and an even more streamlined user experience for shopping.

If a consumer has a good experience searching for products on Google and buying them once, well, duh, they’re going to do it again. Amazon has this down to a science. Google is trying to get their PHD.

What do you think will happen?

Imagine if Mall of America had unlimited space and let all merchants setup shop for free.

Now imagine if Mall of America abruptly changed their business model and told each merchant they would have to pay rent based on how much foot traffic each of their stores get.

This is a reality online merchants face after Google Shopping, the largest comparison shopping site online, announced it would be transferring to a pay-to-play product comparison site.

Many merchants are leaving the marketing channel completely. Most will stay and pick up the increased demand caused by the vacuum of smaller merchants out of the program.

So far bids are ranging around 40 – 50 cents. So you can imagine if a small business was getting 500 clicks per month from Google Shopping, and now they bid around 40 cents per clicks, that’s an added expense of $2400 per year to, in an industry where margins have been decreasing for years now.

Many retailers will have to start writing bigger checks, paying more than $100,000 / year to Google while some like Amazon, eBay and Walmart will face a difficult decision - either cut Google a 7 figure check each year or “give away” the market share that was previously free.

Google Tip-Toeing Into Ecommerce

The new Google Shopping and Google’s release of Google Trusted Stores may seem like small moves to the average eye but ecommerce experts see a major shift on the horizon: Google competing directly with Amazon.

Amazon, the online retail giant that accounts for more than 1/3 of all purchases online, now owes Google a pretty penny in margins for thousands of sales per year generated by Amazon products in Google’s Shopping program.

The next move we think Google will make is a more secure full-service online store experience for consumers. But probably not a Google Marketplace as some suspect (even though the new Google Shopping gives sellers the option to pay only for sales, not clicks).

Another indicator is Google’s new Trusted Stores program that gives Google direct access to merchant order and cancellation information, as well as direct access to online retail customer support teams and the merchant’s customers themselves.

The retailers that participate in this program, all who are required to sustain specific customer service standards and capture more than 1,000 transactions per month (at the disgust of quality smaller merchants) will surely see some form of benefits in search engine rankings, if not directly then through the addition of future Google Trusted Stores rich snippet markup in SERPs.

So what is Google’s ace in the whole?

Google may be actively pursuing local-availability product fulfillment, a space where Google local search has an edge on Amazon. Being able to fulfill product orders to your doorstep on the same day would be a huge move by Google and threaten Amazon’s 2 day Amazon Prime shipping program and could make Google a fulfillment powerhouse, charging merchants for direct local delivery access and online access through search to consumers.

I can picture it now: fleets of robotic controlled Google cars delivering products across the globe. A little farfetched? Maybe. Maybe not.

The Google Marketplace: Why Not?

The argument against Google creating its own marketplace rests on the assumption that Google does not want to damage its main source of revenue – ads. Moving into a marketplace model would lock sellers in at a set CPA, potentially giving up placement in SERPs that were once held by ads.

CPC ad programs have traditionally been more profitable for the owners of those programs. Nextag, a long-held opponent to Google’s increasing aggression towards content-aggregation sites, attempted a marketplace model on Nextag not too long ago with benefits to the merchants who used the program, but at a loss in ad revenue to Nextag.

This is one of the major reasons why we think Google will stay the course with its ad-based programs but offer a level of fulfillment unheard of in today’s ecommerce world.

The Small Business Online Retailer: Forever Forgotten?

Small businesses who relied on Google Shopping as a major source of free traffic and sales are hardest hit by the new Google Shopping.

Some major questions they are asking include:

1. Can I manage this program in house? Do I have the technical and time resources available to update ad_groups and CPC bids multiple times a week?
2. Do I have the technical expertise to tease out top performing products and brands through Google Analytics to optimize my campaigns?
3. Will the money I lose on margins for each sale make this shopping channel worth my time?
4. What traffic source will help mitigate for this loss?
5. Does the Google Trusted Stores 100 orders / month minimum to qualify for being considered for the program further hurt my ability to rank for product searches in Google?

Definitely some hard questions to answer but one thing is for certain, retailers who rely on Google as a major lifeline to their online store are now looking for other cost effective ways to get traffic to their businesses. And this creates a lot of potential opportunities for existing & new Internet entities.

SEOs: Forever Alone?

It’s been a tough few weeks for some SEOs who are still grappling with the fact that very few organic results will be above the fold for transactional search queries.

For most SEOs I talk to, even before the Google Shopping switch, a majority of their work was not with ecommerce clients in the first place, but this is another strain on businesses built around optimizing the placement of organic listings which have been decreasing in visibility consistently over time.

Search Engine Marketing: A Shift

A couple of weeks ago on #ppcchat we were lucky enough to join the conversation about Google Shopping. One thing that was clear was that most paid search marketers didn’t know much about data feeds or data feed manipulation.

We predict that to soon change. For marketers dealing with ecommerce clients understanding how a data feed works and being an expert at how to manipulate and maintain it will be just as important as optimizing Product Listing Ad bids.

Many small merchants and some SEOs have shown their disgust with the move and will  likely take their products elsewhere to advertise. Affiliates will also have trouble on Google Shopping, making the potential traffic pie much larger.

Even marketplaces will be affected. Merchants who sell on Ebay or Amazon, if they don’t see any change in sales, can rest assured that their marketplaces are paying a hefty check in the million+ dollar range each month for their listings to compete in Google Shopping rankings.

My guess is that some will see slight declines. In any event, the new Google Shopping presents large opportunities for retailers with the resources to invest into this marketing channel.

Google Shopping Facts To Keep In Mind

•  The new Google Shopping is strictly product based bidding.

Long have search marketers bid on keywords and products to secure placement in search results but now, you have the ability to bid based on product attributes, ad_groups and ad_labels to fine tune the placement of a group of products for a certain period of time.

The ability for each merchant to find their products’ sweet spot, and secure that sweet spot from their competition, which includes Amazon, Buy.com, Ebay, Walmart, and other big players, it’s important to be smart about ad spend and management in this channel.

•  Product bidding sometimes means public competition with merchants over certain categories.

Online retailers know the pain of starting up on a comparison shopping engine and failing because they didn’t understand the various bidding strategies needed at the product, sub-category and category level to be successful (along with promotions, product feed category mapping, click spikes, etc etc).

So it’s important to give this channel the analysis and attention it deserves the first time around to save yourself the headache of having to stop a program like this and restart it at a later date.

• In recent years, the outsourcing the management of these campaigns have been done by a wider range of merchants.

Multi-channel selling continues to evolve. Google Shopping going paid is just another channel that requires time, energy, and data feed / CPC bidding expertise and management to master and excel against competitors.

• Large SKU inventories have an advantage to bid at low CPCs and tease out high-performing groups.

The challenge will be matching placement to demand early, in order to capitalize on potential sales while simultaneously controlling costs with such a large product feed generating exponential amounts of spend.

• The challenge of the small merchant is to bid enough to get quality traffic, at least as much traffic from Google Product Search, at a rate that is profitable for your business.

How hard it will be to find that spot remains to be seen, especially with Google’s announcement of their trusted stores program to be available only to merchants with more than 1,000 transactions per month.

That just doesn’t cut it for some of the quality smaller merchants that don’t have that many transactions especially if the Google Trusted Stores program gives those larger merchants more visibility in the new Google Shopping SERPs (which are live, including new Google Shopping Guides we’ve seen for a variety of queries already).

• The ability to tease out high-performing products within ad groups and labels and optimizing bids based on that analysis is hard.

Product bidding managers know about price bucket reports, brand reports, category reports, top seller reports, product loser reports, conversion reports, cost of sale reports, each one of these presents it’s own value to achieving an ROI so the ability to track these groups in Google Analytics is extremely important.

7 Advanced Google Shopping Tips & Strategies

1.  Get Your Analytics & Tracking Parameters Ready

To track traffic, you’ll have to fill out the ‘adwords_redirect’ field with the full URL to your product page appending with tracking parameters differentiate Google Shopping traffic from Google Product Listing Ad traffic.

For example, if your product was at the follow URL www.mysite.com/product1.html

You would populate the ‘adwords_redirect’ field for product1 with a Google Analytics Tracking Parameter specific to product listing ads, for instance:

www.mysite.com/product1.html?utm_source=googlepepla&utm_medium=adwords

Now, any traffic coming from product extensions or product listing ads will be tracked under ”googlepepla / adwords” within Google Analytics.

2.  Differentiate Product Listings & Extensions

We can also differentiate between free Google Shopping (soon to be depreciated) and product extensions and product listing ads traffic–now we must figure out a way to differentiate between product extensions and product listing traffic.

All this requires is another column, called “adwords_queryparam”. Curiously, Google has taken this part off their help pages for whatever reason, but it still seems be active and working for our clients.

In the example below, we fill this column with “utm_content={adtype}”.

This column allows you to have Google automatically append your URLs with what’s in the column, and replace {adtype} with “pe” or “pla” depending how a user got to your site.

To backtrack a step, a user going to your site via product extensions or product listing without this column will end up at:

[yourdomain.com]/page1?utm_source=googlepepla&utm_medium=adwords

With this new column, a user coming from product extensions specifically will end up at:

[yourdomain.com]/page1?utm_source=googlepepla&utm_medium=adwords&utm_content=pe

Similarly, a user coming from product listing ads will end up at:

[yourdomain.com]/page1?utm_source=googlepepla&utm_medium=adwords&utm_content=pla

Which then allows you to further break down your traffic source between product extension and product listing ad users in Analytics.

3.  Identify Products That Get The Highest Rankings  In Google Shopping SERPs

Simply type in general product-type searches for products in your inventory, such as pencils, refridgerators, washing machines, tables, sofas, toys, etc.

3a. Check for those products in your inventory and determine if they have the appropriate keywords and that you’re competitive by price and make sure your landing page is functional.

3b. If all those things check out it’s a good indication to bid up 5 – 10 cents on those products and watch spend carefully for the next few days to make sure that more conversions outweigh the additional spend.

One other thing:  we’ve also seen that the new Google Shopping Sponsored Pages are live - we found them late on 6/27/2012.

4.  Where Should Merchants Start Their Bids? At 1 Cent Or At 1 Dollar?

Merchants who are already bidding on Google Product Listing Ads know the amount of traffic relative to their free Google Shopping traffic is small. If you wish to test out bidding on Google Shopping, bid high around $1.00 – $1.50 and see how much traffic you get.

We’ve routinely seen CPCs settle around 50 cents or less and conversions be consistent with levels from Google Shopping.

5.  How Do Merchants Know When A Product Or ad_group Is Not Performing Well?

Having 50 – 100 clicks on a specific product without a sale is a pretty good indication that there’s something wrong with that product listing.

Remember that no products ever need to be removed from the Google Shopping campaign if they are performing poorly. They just need their bid changed to a 1 cent bid.

On top of that, make sure you are analyzing the right product data to make campaign optimizations. Often just because an ad_group isn’t working doesn’t mean that each product within that ad_group does not work.

It usually means that there are specific products though that are not working within that ad group. Penny bid those products and see if the remaining products in the ad_group can succeed.

6.  How Do Merchants Know When A Product Or ad_group Is Performing Well?

A cost of sale (COS) (spend divided by revenue) that is half of your goal (say you are going for a 4 to 1 ROI (25% COS) but your ROI is really a 8 to 1 (12.5% COS) for a specific product or product group) is a good indication that that product is performing well.

To increase sales, bid that product or group up by 5 – 10 cents to expose it to a wider range of product queries and watch it’s performance closely over the next few days to make sure increased spend did not rise too much.

6a. Risk for error is high here because the products can get more clicks but not an increase in sales.

For example, if you bid up on a ad_group when in reality only a handful of products within that ad_group are performing well, you’ll find yourself with a high-spending, low converting ad_group, the opposite of what you were trying to do.

Teasing out the products that lose or win and forming new ad_groups on those product groups to isolate losses and wins will be an essential part of Google Shopping management to achieve maximum effectiveness.

Vigilance will be just as important, being able to focus on the shopping channel as one that now needs ROI analysis is a huge resource pull to ensure that all advertising dollars are spent with maximum effectiveness. These points lead me to the final tip.

7.  Data Feed Proficiency Is A Must For Quick ad_group &  ad_label Manipulation 

If you’ve never dealt with data feeds before, you’re in for a fun ride.

Let me save you some time: Unless you’re highly technical and can spend a few hours a week maintaining the data feed and bids for this campaign, find an employee or a company who can handle this campaign’s size and skill needed to be successful.

We’ll have more on specific data feed strategies in our next post.

What’s Ahead For Retailers In Google Shopping?

Online retailers that can stick it out have the potential to stake claim to traffic that was previously consumed by smaller merchants and affiliates. Even bigger merchants may tone down bids on high-traffic products that don’t convert, creating additional opportunities for small and mid size merchants to capitalize.

Whatever side of the road you’re on, the change of Google Shopping to a paid model affects all merchants. If you list on Ebay, Amazon, Buy.com and other comparison shopping engines, each marketing channel is making adjustments to their traffic mix to compensate for the potential losses received by Google’s monetization of this free channel.

It creates the potential for big gains for the merchants that stick around, monitor their Google Shopping campaigns and optimize bids, ad_groups and ad_labels constantly.

It also creates the potential for big losses, and tons of merchants are looking for new B roads to fill the loss in traffic or to completely avoid Google as a revenue stream altogether.

What are you doing to prepare for either scenario?