July 8, 2019
4 Case Studies Using tROAS for Google Shopping
The digital advertising landscape has changed significantly for ecommerce advertisers over the past year, especially as Google increasingly shifts impressions from text ads to shopping ads. Among retailers, Google Shopping spend increased 32% year over year in Q4 2017, compared to just a 15% increase for text ads, according to Merkle. Furthermore, Google is not only increasing how often shopping ads are shown but also how many shopping ads are shown. It is now more common to encounter the nine slot shopping ad format, compared to the previously standard four to six slot formats. In addition to this, the 30-slot carousel format has become increasingly prevalent on mobile. While this may not seem immediately concerning at first, this shift can have direct revenue implications.
While shopping ads overall are seeing impression growth, there is also more competition on the page due to the new shopping formats, leading to lower click-through rates for individual advertisers. Couple this with the fact that Google is increasingly shifting impressions from text ads to shopping ads, and you may find yourself losing a substantial amount of clicks despite little-to-no change in impression share.
Take, for example, the above retailer’s year-over-year metrics. Despite impression share staying consistent, impressions on both branded and generic text ads decreased 50 percent and 34 percent, respectively. This led to decreases in text ad clicks, even for branded text ads, despite the category’s 61 percent growth in click-through rate.
Clicks declined on shopping as well, despite 38 percent impression growth. Though the retailer showed more shopping ads overall, its ads made up a smaller portion of overall shopping ads that were served.
There is no avoiding the fact that the retail paid search landscape is undergoing major changes, but that doesn’t mean your performance has to suffer. There are steps you can take to stay on top of this shift, rather than be hurt by it.
Price plays a large role when it comes to Google Shopping. Searchers are able to compare prices right on the search engine results page, which greatly influences which ads they choose to click. Also, Google tends to award lower-priced products with more impressions and lower CPCs (due to higher CTRs). Take a look at the competition on your key shopping terms. If you are seeing advertisers with better prices, it may be worth testing a lower price point. You will get less revenue per item, but the potential improvements in CPCs and site traffic may outweigh a smaller margin.
A healthy Google Merchant Center feed is the foundation of any successful shopping campaign. Not only does the shopping feed determine the content of your shopping ads, but it also influences how often and on which search terms your shopping ads show. By taking a strategic approach to updating product titles and descriptions, you can sculpt traffic towards top performing queries and avoid product disapprovals. For example, let’s say you sell dinnerware and the query “vintage porcelain plates” is a top-performing keyword in your search campaigns. By making specific feed changes, such as including “porcelain” in the material column and “vintage” in the title and description, you increase your chances of showing shopping ads for those valuable terms.
You probably already know the importance of ad copy testing for text ads. However, product title testing for shopping ads is often overlooked. Titles are one of the three components of a shopping ad, next to picture and price – you can basically consider them to be the ad copy of shopping. With an increasing number of competitors’ shopping ads appearing on the search engine results page, having an ad that stands out is more important than ever. By adjusting the verbiage, length, and word order of product titles, you can achieve stronger click-through rates and, ultimately, lower CPCs due to quality score improvements.
The rising importance of Google Shopping is a trend that ecommerce retailers cannot ignore. By staying price competitive, performing regular feed optimizations, and testing product titles, you can reap the benefits of this changing digital landscape.