The New Google Shopping 3-4 Months on

Google announced that on June 11^th Google shopping will complete the transition to a paid model in the UK, Germany, France, Japan, Italy, Spain, Holland, Brazil, Australia, Switzerland and the Czech Republic, meaning that all advertisers will need to run Product Listing Ads (PLAs) to promote their products on Google Shopping and bringing to an end the amazing source of free targeted traffic that was Google Shopping, Google Product Search, Google Base, Froogle and a number of other names that I have long forgotten.

Froogle actually started out life in 2002, staying in ‘Beta’ for what seemed an age. The fact that it has taken nearly 11 years and many incarnations is testament to Google taking their time to get it right.

So now, nearly four months on how is the new Google Shopping performing? Is it delivering the improvements that moving to a paid model Google said it would? Are advertisers switching more and more of their budgets to PLAs as Google says they are doing in the US?

The Transition

Firstly Google shopping was great because it was free, so with a bit of work (though sometimes quite a lot) you could get fantastic ROI. However, there was always the nagging doubt that it wasn’t working as well as it could do and if you had to pay for the traffic, it wouldn’t be viable. We were seeing huge volumes of traffic for some clients, however the engagement and conversion stats were awful. Bounce rates of 70%+ were not uncommon and on one keyword we saw nearly 12,000 visits in a period without a single conversion. The work involved was getting the product data to Google in an acceptable format and then working out how you got your products to be featured at the top of the listings or ideally in the prize snippet at the top of the Google search page. You also had to comply with Google’s seemingly constant changes to its feed specs and product taxonomy.

Because of the free nature of the channel, there was a general lack of information and help with getting the best results. Success came from trial and error and great detective work, basically the optimisation skills involved in SEO without the ‘glamour’!

Although Google suggested the transition to the paid model would be smooth and merchants would still receive free clicks, in reality the changeover was quite brutal. The below graph is a typical example of how free traffic was affected:

Essentially Google still showed your free listings on the shopping pages but scrapped the shopping snippets from the main SERPs which drove the real high volumes of traffic, replacing them with Product Listing Ads in various formats, as they tested the best way to deliver them.

Google promised to sweeten the deal with discounts or vouchers for use with PLAs, which were a nice offer, although hardly compensating to the same value.

The Concept of Product Listing Ads

PLAs basically work in two ways:

1. Shopping Listings

Listings in Google Shopping, accessed via the Shopping Link on Google or via a teaser on the SERP, which lists searches of products based on your keyword term comparing prices and relevancy, with options for your location to show you bricks and mortar stores in your vicinity in addition to online shops and additional filters for a variety of product /category specifics, in very much the same way that the other comparison sites like PriceGrabber, Shopping.com, Kelkoo, etc., work.

2. Search Page Results

PLAs also appear in the main SERP, currently either just below the top sponsored ads like this:

Or to in a column or box to the right of the top sponsored ads, like this:

The top PLAs for the term, based on bid/relevancy/quality score, appear in these top spots.

The Logic of Product Listing Ads

The logic of Product Listing Ads is almost unquestionable. You are searching for an item, you Google it, you see immediately a picture of your desired purchase, its price, who is selling it and a link directly to the page where you can buy it. You can search through Product Name, Brand Name, Model Number, ASIN, EAN, GTIN, MPN or a variety of specific and non-specific terms and find Google’s closest match. The ROI should be out of this world. PLAs are the answer to every retailer and marketer’s dreams.

So it’s a no-brainer, right?

The concept is brilliant. I am looking for a specific product, I type in the specifics I know about it. Google serves me the closest results it can find. If I am looking for an iPhone White 32GB on o2, I will only click on links that are appropriate, I’m not going to look at a Black 16GB am I? I’ll compare the prices of each iPhone White 32GB, select the best deal and then one click and done. Result all round. Simples.

However it is not quite as simple as that.

Firstly consumers are savvy and getting savvier every day. Before purchasing anything they will compare specs, read reviews, seek peer information via social means, undertake searches, visit manufacturers and retailers sites, and so on. The shopping price comparison is often done at the end, but it can also feature in many other areas of the purchase process. Even assuming that the buyer is ready to purchase, if a retailer is not competitive, is it a good or bad thing that they appear in the comparison results? If a retail brand is constantly being undercut by other retailers, what sort of message does this send out?

Secondly, it’s all about relevancy. A lot of retailers want to achieve high visibility, so if they sell cameras or mattresses, they want their ads to appear. Assuming I want to buy a camera or mattress, there are a lot of other factors I need to think about before buying, such as size, type, specification, quality, etc., etc., I am not going to click on a result for the first PLA that I see, am I? Unfortunately, we are seeing that people do click, not to buy but just to look.

Thirdly, it’s about the results. An advertiser cannot control what keywords they are ‘bidding’ on. Google will crawl your product feed and serve what it believes are the most appropriate PLAs for each search query. You can filter through a variety of means to include the products that you want (and exclude the products you don’t want) however you can’t guarantee that a particular product will appear. Furthermore if you filter too much, it seems that Google cannot get enough data for its algorithm to work so you can very often just exclude everything. So, in practise, you have to open up your feed to all items and then exclude. Keyword targeting is much the same. You have no control over what terms will serve your ads, so you need to let the ads run and then negatively match as you go along. Try to put too many negatives in at first and you don’t see your ads at all and don’t get the opportunity for some of the real long tail golden nuggets. Because of the sheer volume of searches and some of the generic terms Google are serving, this can be quite a costly experiment at first. Furthermore, because you are not seeing the terms generated in real time, you can often run up quite a bill before you can start to negative matching.

Fourthly, it’s about your landing page. Because by its nature, all these ads land on standard product pages, you need to think closely about them and the user experience when they get there. If you want your ads to appear for the term ‘sofa’ you need to think closely about the product in your inventory that would be the most appropriate or best representative of your business. You then need to make sure that on that product page there is easy navigation to the rest of your collection of sofa’s, plus links to your ‘best’ other sofa’s to give you a fighting chance of impressing your prospective customer. If the user lands on a poor product page with few other options not only will you have wasted your click cost, but you’ve probably put the user off your site.

How to Make Product Listing Ads Work for You

So, in summary, how do you get the best out of Product Listing Ads?

1. Be prepared to commit time, money and resource to getting the best results.
   
   
2. Make sure your feed is up to the job, with all the fields and options that are available. If you have a very dynamic product range or your prices change frequently, this needs to be automated with daily updates or more if you change prices very frequently. You also need to get your buyers/ merchandisers onside so that they provide the input to what products you should be focusing on and which you shouldn’t.
   
   
3. Rigorously test and optimise your feed to make sure all your products that you want to appear are appearing and those that you don’t want to be there aren’t. You also need to be aware that this is a dynamic market place and things change very fast. It didn’t work last month, doesn’t mean it won’t work this month.
   
   
4. Analyse the search queries. Test whether they are relevant to your business and whether you feel your products should appear in a search for that term. Negatively match all the non-relevant or non-appropriate terms, then think again and brainstorm any other terms that you think might trigger and negatively match those too. Then carefully work out which products need to appear for the term you are still permitting and work out ways of filtering your feed so this happens.
   
   
5. Having done all this and having set up highly targeted AdGroups containing your product filters and negative keywords, you need to adjust your bid appropriately. From our experience, bidding too low will just mean you soon lose out on impressions but bidding too high can soon lead to excessive CPC. You need to be very selective about the value of each click and work hard to manage the bids down.
   
   
6. You then need to carefully look at the chosen product landing pages and optimise accordingly so that you give your prospective customer a range of other choices if your selected product does not meet their immediate requirements.
   
   
7. Continually analyse your results and optimise accordingly. Look at everything from terms to CTR to user experience to fine tune your PLAs to achieve the best results.
   
   
8. Finally, if you’ve done all this and got your PLAs working well, you will be bringing a lot of quality, targeted visitors to your site. Once you’ve got them there, make sure you set up a reasonably sophisticated remarketing campaign to leverage the maximum value out of your targeted visitor/prospective customer.

Product Listing Ads - Summary

We’ve seen some fantastic results so far from Product Listing Ads, we’ve also seen some horror stories. At its best it is an absolutely brilliant direct marketing tool, at its worst it is an irrelevant product showcase that can damage a brand and rack up a big bill.

Google say that most retailers are now spending 20-30% of their AdWords budget on PLAs and we’d say that this is probably the way it should go in the UK. Get your product listing ads working correctly and then work out how they should fit into your search marketing mix. With correctly positioned text ads, and strong remarketing, display and organic campaigns, your directly attributable ROI from PLAs should be the best in your portfolio.