1. The Power of Google Shopping
Why The Advertising Platform Can Make A Store Succeed Overnight
Nobody reads ads. People read what interests them, and sometimes it’s an ad.Howard Gossage, an advertising innovator known as “The Socrates of San Francisco” in the 50s and 60s
Google since 2002 has provided retailers ad solutions to boost sales by promoting online inventory and increasing foot-traffic to retail stores. Previously referred to as “Google Product Search” and “Froogle,” we now know this as “Google Shopping”. The channel is one ad format on Google Ads that can be part of Performance Max campaigns. Don’t let the name shuffling distract you from its power.
From small retail start-ups, to the biggest companies in the world like Amazon, businesses in the ecommerce industry take to Google Shopping to drive product sales. The channel attracts 76.4% of retail search ad spend in the US and 82% of retail search ad spend in the UK, according to Search Engine Watch. Google’s collection of first-party data kept performance strong post-iOS14.5 while Facebook and Instagram ads bled from less data.
The Google Ads model created 81.59% of Google’s revenue in 2021. The earnings report in Q3 2022 for Alphabet, Google’s parent company, shows ad revenue of $54.48 billion. The advertising platform continues to be one of the biggest channels for growth because retailers find profit through it.
What do individual companies experience? I run Digital Darts, a company certified by Shopify in marketing as part of their Experts program, and certified as a Google Premier Partner. Every day we manage Google Ads for Shopify stores. Here are some results we’ve recently achieved:
- A fashion client averages $13 for every $1 spent with a $30k monthly budget.
- A client successfully raised money on Kickstarter to launch their pet product. They were lost at how to grow after the crowdfunded campaign. Their ad campaigns smashed goals by 4 times.
- A large dropshipping company stalled at $80k in sales for 2 years. The month we took over their Google Ads, they broke through 6-figures of revenue to reach a record month.
- A software company that sells licence keys spends millions per year on ads.
- This is just a sample of profitable results on Google Ads for Shopify businesses.
Google Ads gives more control and accurate reporting than paid social platforms or traditional media. The ease, simplicity, and convenience of the online shopping model, makes Google Shopping or Performance Max campaigns a key tool in your arsenal to grow sales.
The Ultimate Advertising Platform
Shopping ads typically appear at the top or right of search results.
Other locations include the shopping tab of search results, image search results, YouTube, and partner websites.
Google has invested billions of dollars into search algorithms in order to deliver users relevant search results. Google wants advertisers to maintain this experience, so its users solve their problems and spend time on Google’s platforms. The giant gives advertisers the tools to make scientifically accurate decisions and then rewards them for relevancy in the form of lower costs and increased volume.
The Performance Max campaign type is an accumulation of billions that Google has invested over the last two decades towards intelligent advertising. The campaign lets advertisers efficiently use all placements, like Google Shopping, across Google’s ad network.
I love the Google Shopping channel for geeky reasons. I feel it is the ultimate advertising platform because the return on investment is clear, the control is hyper-granular, and it is a reliable lead-generation tool.
1. Measurable ROI
Marketing is seen as a necessary evil. How many times have you heard the phrase, “You need to spend money to make money?” Probably more times than you’d like. A typical store owner must ask themselves many difficult questions such as, “How much do I need to invest in marketing?” and “How do I know it’s working for me?” This is where digital marketing has been advantageous with its ability to measure bottom-line results.
Google Shopping is a prime example of a platform that allows any advertiser to breakdown real results then attribute them in a granular fashion, allowing a store owner to see every penny spent and what results came back. Once your desired ROI is achieved, then you can increase your budget.
The granularity goes deeper than seeing an overall ROI. You can break it down to incredible actionable insights including:
- Time of day: Do you want to bid more for people when the majority of searches or transactions take place? Do you know what time people browse and research, but do not buy? All is possible to understand.
- Device: Do people buy from you more often on mobile because it is quick and convenient? Or, perhaps they convert later while searching on their laptop when they have more time to think about the purchase? I’ve turned unprofitable campaigns into cash-cows by simply observing how mobile users convert at half the rate of desktop users. I cut bids on mobile by 50% to reduce wasted ad spend on 50% of clicks across the account. This had a double benefit of then spending aggressively on devices that were profitable.
- Search terms: You can know what exact terms people search to find your products. The advent of Google Analytics reporting the majority of organic keywords as (direct) / (none) meant you cannot know what organic keywords lead to revenue. This makes a goldmine of knowing what keywords in a paid search campaign led to a sale. You can use the data to make better decisions for search engine optimisation and product naming that would otherwise be a trial-and-error scenario.
You can work on leveraging this data with a second major benefit of the platform.
Insight is pointless without the ability to act on it. Google gives advertisers the control of how much they want to pay for a click depending on the time of the day, and the user’s device, location, and past interactions with the website.
Advertisers can block ads from showing up for certain keywords. Alternatively—and my general recommended option—if you don’t want to go as far as switching off certain attributing factors, you can choose to spend less on them. For example, if you have a brick-and-mortar store closed on Sunday, you could spend 50% less on that day. Sunday searchers will buy later in the week.
Another example. Let’s say you own a women’s clothing store. Your target market is women aged 25-50. When looking at the demographic data, you realise women click a lot on your shopping ads, but men click less yet convert more than women. Male shoppers get you a higher ROI. (It’s not unusual to have people completely outside your market convert better.) In this case, you should pay a higher cost-per-click for males to get more clicks.
If someone visits your website then returns to Google that night with a search that triggers your ad, chances are the data will tell you to pay extra for the user’s click because they are more likely to convert. You can take this one step further. Someone who viewed 10 pages on your store has a higher chance of buying than someone who spent less than 60 seconds. You can create audiences off any type of data in Google Analytics to bid higher or lower for a click.
This takes us closer to the adage of all performance advertising:
Get the right message to the right people at the right time.
3. Conversion rates of sales and leads
Many retailers who do Google Shopping, will tell you it gives them the highest revenue and return on ad spend—second only to email. Channels that generate demand like display, paid social, or native ads, generally see a higher number of bounces and poorer conversion rates compared to search. Yet, the user experience on the website is the same.
The reason is intent. User intent is the most influential factor of conversion rate optimisation. By the very nature of search, people seek solutions to their problems. Google Shopping supplies existing demand.
Some searches contain stronger commercial intent than others. A person searching “buy lightest camping tent” is ready to hand over money. You bet with over 70% of revenue coming from ads, Google invests a lot of money into their advertising technology. They want to know when to show shopping ads so advertisers make profit and continue to spend.
Another reason shopping ads convert well is the transparency of key information. The information of price, imagery, and product title in the search results of a shopping ad, informs people before clicking an ad. That means before you pay anything for a click, someone knows the product’s price, appearance, and potentially features.
The Downside of Google Shopping
The power of Google Shopping comes with challenges. As more ecommerce businesses take to the platform, competition can be fierce. The data tells sellers it is essential to their marketing plans. When a new store advertises in position one, other merchants in the same bid auction drop one position while experiencing a decline in sales. If merchants want the same volume as before, they must bid higher per click or boost conversions from less traffic.
If you run campaigns yourself, you compete against professionals like us at Digital Darts that do Google Ads full-time who know every trick in the book. I regularly chat to shop owners in Shopify forums who wonder why they spent $500 on ads and have not made a single sale. Shopify is filled with solopreneurs who do too much themselves. Further up in store revenue, the 8-figure brands we work with really benefit from professionalism as one adjustment, like optimised product titles, can add five-figures per month from shopping ads.
The control of the platform brings with it a complexity that is overwhelming for an amateur advertiser. Meanwhile, the platform is a treasure chest of opportunities for the savvy advertiser who makes full use of its features to eliminate wasted spend and pay aggressively for profitable users.
Once a business sees results from Google Ads, they invest further to grow. This may include bringing experts in-house, buying new tools, allowing more ad budget, redesigning webpages to boost conversion rates, and improving the customer lifetime value in order to afford higher costs per click.
The aim is never about dominating the search engine. When operational costs are the same as competitors, you can afford to pay more per click when you make more revenue. The aim of Google Shopping comes down to making your business the most profit.
There is an abundance of best practices you can follow to maximise your reach and return from Google Shopping. You can become a savvy advertiser. Not only will I break down how the channel works, I’ll share with you my arsenal of optimisation tips that allow us at Digital Darts to repeatedly grow Shopify store after Shopify store.
- 1. The Power of Google Shopping
- 2. How Does Google Shopping Work?
- 3. How to Profit From Google Shopping
- 4. How to Set Up Key Google Products for Ad Growth
- 5. Your Google Shopping Feed in Shopify
- 6. Google Shopping Campaign Structure
- 7. Performance Max Campaigns
- 8. Optimise Your Google Shopping Campaigns
- 9. Google Merchant Center Programs
- 10. Expand Beyond Google Shopping