What is Google Shopping, and how does it work?
Have you heard about Google Shopping? If you’ve ever Googled a product, you’ve seen it in action! All of those products that popped up in your search are products that Google placed there, for a number of reasons. You see, Google Shopping isn’t really an “online shop,” but it’s an advertising opportunity driven by the search engine itself.
Google Shopping is designed to attract potential buyers for you. Google is the number one search engine that people go to look for items. For example, if a customer is looking to buy a certain kind of Nike sneaker, she will go to Google and type the details into the search bar. The customer is less likely to go directly to the Nike website because she knows the prices will be too will all be high, and the exact sneaker she’s looking for might not even be available anymore. Going to Google saves time in the search process, and will give the customer a wider range of stores that sell that sneaker.
Google Shopping ads advantages
- Higher click rates
- More traffic
- More sales
- Giving them an online marketplace
- Free setup
The elements behind Google Shopping
Google Shopping is part of AdWords, but there are no conventional images or text ads. Basically, the store operators share the data from their online store with Google, and this data is what makes up the “product boxes“. The product boxes are just a picture of the product up for sale, its price, and shopping costs. Google controls how this product box appears to customers.
The payment process is a cost per click (CPC) auction process. In this process, the owner of the shop decides how valuable a click is for him/her. The higher the bid for an item, the higher the chance that the offer will be at the top of the list, or at least as close to the top as possible.
How does Google Shopping work?
It’s pretty simple. When a product from your online shop gets placed on a search result list, you pay nothing. You only pay when the shopper actually clicks on the link to your product. This click brings the shopper right to the online store where the product is up for sale. At this point in the process, Google has done its job and has nothing else to do with the rest of the buying process, for both you and the shopper.
Your payment to Google Shopping for those clicks all depends on the competition at the time of the sale. On average, the payment will be 10 to 15 percent of the sale amount. You can improve this number in a few different ways, as time goes on and you become more experienced with Google Shopping. However, improving the percentage heavily depends on the way the product is shown to the shopper in the online store itself. Ultimately, these customers don’t base their purchase on Google Shopping, but in the presence of the online store.
How can Google Shopping drive more traffic and sales?
Google Shopping has brought online stores a wide range of opportunities. Owners of online stores now have a new way to expand outside of their shops while gaining potential customers, all while paying absolutely nothing. This is the beauty of Google Shopping!
Google Shopping ads benefits
- New customers
- More Views
- More sales
- More clicks
- A free setup
Google Shopping features products in “product listing ads.” Product listing ads are the little squares that show up in your Google search results after you search for a specific product. These squares have a picture of the product, the price, and the link to your online store in them.
According to a study done by Merkle, product listing ads make up approximately 62 percent of non-branded paid search clicks for online retailers. So, as you can imagine, Google Shopping can drive your traffic and sales through the roof!
More views = More traffic
If more people see your product ads, more people will land on your product pages. Google is the most popular search engine that has ever existed. People are constantly Googling things and searching for products on Google. If you’re selling bicycles, and someone searches for a bike on Google, boom, your bike pops up in the product list!
Until now, this customer didn’t even know your store existed. Google has placed your product in front of this buyer because you have the product she is looking for, and it’s available for a good price. Now, this customer clicks on the bike and is brought directly to your store. She can buy the bike directly through you and can browse through the rest of your store at leisure. At the end of the process, Google has introduced your store to this customer, and has helped you make a sale!
In Google Shopping, look at Google as being the “middle man” in making a sale. Google knows that your store exists and it knows that the customer exists. All it does is link the two of you together! This process brings in new customers that wouldn’t have found you otherwise.
More traffic = More sales
Google is placing products in front of the very people looking for these items! Your brand is right under the nose of people who want to buy your products! That’s an amazing thing. Google gives your brand and your store more online visibility than you might realize. With so many people searching on Google every day, the search engine holds the key to reaching a huge amount of people.
By using Google Shopping, your store will get more views, which leads to more traffic, which leads to more sales. It’s a very simple strategy that works wonders. Plus, the most more popular your online store is with customers, the more it will show up in a search done by potential customers. Making a few sales to some new customers will lead to more of just that!
Best way to structure Google Shopping campaigns
Choosing the best structure for your Google Shopping campaign can be a difficult decision, especially if you have thousands of products that you’re trying to sell! Some online store owners put all their products into one Ad Group campaign, while others create multiple campaigns.
There really isn’t a definitive right or wrong way to set up a campaign. It just depends on your online store and your products in particular. The key to setting up your campaign is making sure it’s efficient for your monetary needs and goals.
Why is it important to have a set Google Shopping campaign in structure?
You might not realize how vital your campaign structure is. The decision you make when you decide on this structure can impact:
- Brand awareness
- How often your products appear to potential customers
Most popular Google Shopping campaign structures and some pros and cons.
One campaign with one ad group
This is the most basic campaign structure, with just one Ad Group in which you divide your products.
- Quick and easy to set up
- Easy to manage
- Potential customers may not see some products
- You cannot control search attempts for your products
- You cannot boost bids at all
Two campaigns and two ad groups
With this campaign strategy, you can have more control. You can use campaign priority settings and decide how your products show up, using negative keyword lists.
- Quick and easy to set up
- More control = more traffic and sales
- More campaigns to manage
- Some of your products still may not get exposure
- You cannot control search queries within the SKU of your products
- You will have to monitor that both campaigns don’t become limited due to budget
Multiple campaigns and ad groups
This campaign strategy will allow you to control more of your bidding process, which can drastically improve your sales.
- More profit
- You can set preferences on each campaign
- You will reach more customers
- Can be difficult to monitor
- Dividing products into separate ad groups can be a challenge
- You cannot control search attempts for your products
Making the right decision
These are just a few of the most popular Google Shopping campaign structures. Each one has its own benefits and downfalls. As mentioned previously, the only thing driving your Google Shopping campaign structure is your specific online store. Each store and owner have different ideas of success and different monetary goals. Each one of these campaign structures can have a positive impact on your store. You just have to know how to utilize them.
Remember, the structure you choose ultimately controls the search terms that your product adverts appear for. You can always test out each campaign structure and see which one works best for you! It may take some time, but you will discover what works best.
Best way to bid on Google Shopping campaigns
Your bids are the most important part of your Google Shopping campaigns. Your bids determine whether or not your store will be efficient, and whether or not it will be successful. Determining the best bidding strategy for your store is challenging, and takes some practice.
Important tips you should think about when planning your bidding process
The price of your product
Do not have the same bid for all of your products. This mistake is a very common one amongst store owners. You need to make sure that each one of your products has its own unique price that is appropriate to the type of item.
The prices of your products aren’t the only elements that determine how you bid. In order to bid to your own advantage, you need to consider your gross margin.
eCommerce conversion rate
You have to know and understand your average conversion rate before bidding. This is a really important element of your online store.
When to bid up and when to bid down
When you are just starting, you will need to increase your bids several times to get views and clicks. You should increase your bids multiple times over the course of the first few weeks. If you aren’t getting as many clicks as you want, then you should bid more. Even bumping a product up by $.03 will increase traffic, and therefore increase clicks.
Most Google Shopping campaigns don’t hit their monetary goals in the early stages of being in business. As your store improves day by day, Google will show your ads more frequently, and more potential customers will see them. Progress takes time.
While bidding, you should set a budget that will allow you to grow. For example, if your budget is only a few dollars more than what you are bidding, your budget will be wiped out pretty fast, and Google probably won’t show your ads very often. Google knows that it will only take a few clicks to go through your whole budget. This will have a negative effect on your traffic, sales, and overall store growth.
Here are some things to keep in mind:
Lower bids will make your budget last
Your budget will go further with low bids, so if you’re trying to save money, this can be a great strategy. Of course, this method is for the most experienced bidder.
Higher bids can boost your brand
Keywords that cost more are the ones that are ultimately going to promote your brand the best. If you’re going to use this strategy, then you’re going to count on more initial clicks rather than immediate conversion.
How are your products selling? Take this into consideration and see if you can raise your bid slightly. Experiment and see if you can get more views for more keywords. This will ultimately help you sell more and will get more traffic.
These are just a few of the ways to help you bid on Google Shopping campaigns and to help your store become successful. After some trial and error, you will find the best strategy for you!