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Google Shopping glossary for beginners
If you’re only starting out with Google Shopping, let’s first go over a few key terms you should get familiar with before diving deeper into the article. If you’re experienced with Google Shopping - feel free to jump to the next section.
Google Merchant Center
This is your hub for all things Shopping ads. Upload your products and manage your campaigns. This is where Google’s system will pull the information it uses to place and bid on your ads.
Your product feed is a file often in a .txt, Google Sheets format. It holds all the data and information about your products like:
- product variants
- And more
A fully optimized product feed can make or break your campaigns as this is where all information for your ads will be pulled from.
Your Shopping campaigns are the listings you set up in your Google Merchant Center account. They show your products in a visual format, with additional information contained in your product feed.
The main difference between them and Search ads is that Shopping ads contain images and have their own dedicated Shopping tab on Google’s search engine site page.
Smart Shopping Campaign
These campaigns are identical to your regular Shopping campaigns on the surface, but underneath the hood, they are run by Google’s machine learning. We’ll cover everything you need to know about them in the next section.
What are Google Shopping Smart Campaigns?
Smart Shopping takes machine learning to then next level with Google Shopping. It’s also 100% automated.
In fact, standard Shopping campaign management involves long and tedious work when setting priorities, product groups, bids and negative keywords. With Smart Shopping Campaigns, this work no longer needs to be done.
There are no targets, audiences, or placements to be set. The system shows the right products in the right place at the right time. It also chooses the targeted audience. Those decisions are based on the chances the ads have to convert into sales.
Where Smart Shopping ads show
This type of campaign is pretty much self-driving and requires very little maintenance. Smart Shopping Campaigns' core features have an expanded reach across all Google networks and use the 'maximize conversion value' smart bidding strategy.
It may also interest you: Discovery Ads for eCommerce
How to create Smart Shopping Campaigns
Setting up Smart Shopping campaigns is fairly straightforward. Let’s take a look at what you’ll need beforehand and go through the process step by step.
1. Meet basic requirements
Before you dive into creating your campaigns, you’ll need a Merchant Center account linked to your Google Ads account, and a product data feed. Check to make sure that your feed can be updated once a month (30 days) at a minimum.
Google states that you should have at least 20 standard Shopping conversions in the last 45 days. Of course, the more data you have the better. But it's not a hard requirement, so don't let that stop you from getting started.
Remember to also:
- Make sure you meet the general requirements for Shopping Campaigns
- Make sure you follow the Shopping Ads Policies
- Make sure you follow the policy on Personalized Advertising (this one is about the remarketing side of Smart Shopping Campaigns).
Recommendations for better performance
You can start your campaign without these, but Google indicates that your spend (and therefore the reach of your ads) might be limited without them.
Set up conversion tracking: This will track the online purchasing events like signups, purchases from phone calls, and store visits.
This is invaluable information and data that will be used to improve your campaigns in the future.
- Dynamic remarketing: There are two pieces of code you can add to your website in order to enable dynamic remarketing: the global site tag and the dynamic remarketing event snippet.
Once someone visits your website you’ll be able to track the specific events which will be used to make personalized remarketing ads. Google provides the specific code needed on their help page as well as how to set these up.
Adding it to your site correctly is really important. However, it's not as easy as just copying and pasting code to your site. If you don't feel comfortable adjusting code then it would be best to enlist a programmer for help with this part or contact Google's tech team to help. During the set-up process, you’ll be able to email the exact code needed to your web developer.
Here are some general requirements:
The global site tag has to be added to every page of your website, and the event snippet can be added to the pages where you want to track what site visitors are doing. For example, this could be on your product pages, shopping carts, or anywhere you want to see how shoppers are interacting with your services.
You can place the event snippet anywhere, but it needs to be below the global site tag. Each business type has its own specific event parameters that should be substituted in the code. You can find them all here to make sure you’re using the right one for your vertical.
2. Have a remarketing audience
Use remarketing lists and keep adding to them as your campaigns go on. You should have more than 100 active users or visitors within the last 30 days for them to work properly. You won’t need to create a new list if you already have one associated with your Google Ads account. But if not, let’s go over how to add one.
How to create remarketing lists
Set up an audience source. This is where you collect the information about your users from. In this case, you’ll use the global site tag we talked about previously. When someone visits your site, Google will be alerted to add their cookie ID to your ‘Website visitor’ list.
- Sign into your Google Ads account > tool icon > Shared library
- Go to Audience Manager > Audience lists
- Click the big, blue plus button to add ‘Website visitors’
- Enter a descriptive name and choose a template from the “List members” menu.
- Choose the rules you want to apply to your lists.
- Choose what size you want your list to be (this is the number of visitors in a certain time period). If you’ve already set up remarketing tracking on your site then you can also choose to include visitors from the last 30 days.
- Choose how long you want visitors to stay on your list.
- Create an audience description if you’d like and hit ‘Create audience’.
3. Have your assets ready to go
Assets are additional pieces of information and images about your business. They’ll be stitched together in different combinations to create ads. This is done by Google automatically. The better individual assets perform, the more they’ll show up. It’s all part of how Google’s machine learning works in order to serve the best performing ads.
Then these ads are shown to people who have gone to your website but haven’t shown signs that they had the intent to buy something. An example of this could be someone who visited your store but didn’t add anything to their shopping cart.
Unlike with Search ads, the way Display ads choose who to show your ads to is based on how they’ve interacted with your website in the past. For example, if a visitor to your site showed a lot of interest in a particular product then that’s most likely what they’re going to be shown from your catalog.
The assets needed include:
You’ll be good to go if you’ve already uploaded your company’s logo to your Google Merchant Center account. Here are some best practices provided by Google:
Upload a marketing image that is a good representation of your business.
- Text is allowed, but should take up less than 20% of the image
- The recommended image size is 1200 x 628 pixels (should at least be bigger than 600 x 314 pixels)
- Needs to have a ratio of 1.91:1 and in landscape
- Maximum file size of 1MB
This text will be used to create ads. You can get inspiration from copy that already performs well on your website. Keep these limits in mind:
Short headlines: 25 characters or less
Long headlines: 90 characters or less
Descriptions: Used for single-product ads and automatically pulled from your copy when there’s room in the ad.
Provide the link that shoppers will go to when clicking on your ads.
This is an optional asset that you can add. If you don’t have any promotional video prepared, Google can automatically generate short videos that combine elements of the other assets you’ve uploaded.
Note: Before you start, it’s important to understand that it will probably be close to 45 days before you start seeing results. So, give it some time before you make changes to your campaigns. This is because machine learning is at play, and it needs time to collect data from your products.
4. How to set up your Smart Shopping campaign in 14 steps
Sign in to your Google Ads account
Head over to the ‘Campaigns’ section
Add a new campaign by clicking the + button and selecting New Campaign
You’ll see a place to set the goal of your campaign. Choose ‘Sales’ or leave blank. We’ll discuss more about conversion goals below.
The campaign type should be Shopping.
Your campaign can only be linked to one Merchant Center account and be sold in just one country. Choose the Merchant Center account that houses the products you’d like to use.
Select ‘Smart Shopping Campaign’ as the subtype.
Click ‘Continue’ and choose a name for your campaign.
Decide what your budget is (more on that later) and set it.
Choose your bidding type. Google will automatically have it set to maximize your
conversions while staying within your average daily budget.
Do you have a performance goal? Put your desired ROAS here.
If you’d only like to add some products, choose them here. We recommend adding all your products to give Google more opportunities.
Add the assets that we talked about previously.
Preview and save.
Don’t forget about the priority a Google Smart Shopping campaign has over a regular Google Shopping campaign. So if you are advertising the same products via both, Google will choose the ads from the Smart Shopping campaign to display to the potential customers. This is why we advise deactivating the regular campaign to not lose the resources.
Pro tip: You can exclude items in your product feed that you don't want to include. There are many reasons for wanting to do this, like having out of stock or seasonal items. If you're using a third-party tool like DataFeedWatch then you can exclude products through feed-based rules.
How Google Shopping Smart Campaigns Work
Smart Shopping creates ads by utilizing feeds submitted through Google Merchant Center. The process is the same as standard Shopping and standard dynamic display ads.
With machine learning, Smart Shopping campaigns merge insights from Google and retailers. The goal is to maximize revenue or achieve the advertiser’s target return on ad spend (ROAS).
Remarks include such indicators as:
- Search queries
- Product price
- Cart size
- Product category
- Audience lists
- and more
The process through which Google chooses when and where to show your ads is 100% automated by its algorithm. As said above the right time, place, and product shown are based on the likelihood of the viewer to convert.
Is Smart Shopping for you?
Google Smart Shopping is an advanced, highly automated way to manage Google Shopping ads. But you may be debating whether it’s the right move for you.
Smart Shopping is definitely a great solution for:
- Those who don’t have time to run a campaign on their own
- Debutants in the Google Shopping world
- Retailers with limited knowledge and experience in matters of Google Shopping ads
- Retailers with a lot of conversion data and large remarketing lists
At the same time, users should remember that Smart Shopping means the need to sacrifice full control over the campaign and a limited possibility to monitor and analyze data.
Smart Shopping Campaigns may not be the best choice if:
- Collecting search term data is important to you
- Having terms you don’t want to advertise towards (negative keywords aren’t available)
- Wanting to control what creative you advertise and who you advertise to
- Trying to change your goals based on real-time data
- Wanting to allocate unique budgets to shopping efforts vs retargeting efforts
Here are some other potential drawbacks you’ll want to consider before deciding to move forward:
- Location targeting is not available. In fact, all you can do is set the country of sale, but you can't target a specific region or exclude a city.
- Ad Schedule is not available
- Device targeting and bid adjustments are not available
- Audience targeting is not available. Although, as said before, you must have at least one audience list with 100 users, you can't decide which audience to use as a target. Google will choose automatically based on its machine learning algorithm
- Reporting-wise, a few important columns are not available (yet):
- Search Impression Share
- Search Abs Top IS (analytics metric: absolute top impression share)
- Click Share
- Search Lost (Budget)
- Search Lost (Rank)
Smart Shopping vs. standard Shopping
The difference is automation and data
It’s worth knowing that Smart Shopping and standard Shopping run on two distinct codebases and are managed by two different engineering teams in separate Google offices.
But the actual differences between them are almost entirely automation and data. Google doesn’t provide data on audiences, search terms or placements in Smart Shopping campaigns.
The other main distinguisher is how much control you have over each campaign.
Can you run both?
Yes! You can run both campaigns at the same time. But there are some situations where one is more tailored to your needs than the other. Let’s take a look at some scenarios and whether or not Smart Shopping is the right choice:
If you include your whole product catalog in a Smart Shopping campaign, Google recommends you pause your existing regular Shopping and Dynamic Remarketing campaigns.
In fact, although it is said that Smart Campaigns have priority over existing campaigns for the same products, we still recommend you follow Google’s advice. This is in order to avoid ad over-serving and wasting budget.
Expert tactic: Combining the two for the best of both worlds.
If you’ve been debating about whether losing out on valuable data is worth the convenience of Smart Shopping, then this tip is for you. The team at Searchmind came up with a plan to incorporate Smart Shopping into their clients’ Shopping strategies while still receiving the data they were used to getting.
How it works
Their solution was to utilize Smart Shopping at the top of the funnel of their Shopping strategies, letting it be a way to brand and market. That way their clients could keep the rest of their standard Shopping campaigns as is while discovering how Smart campaigns work for them.
The main drawback of this method is in the event something goes wrong. In that case, the lack of data and insight into how your budget was divided (remarketing or new shoppers) makes it tricky to assess how to prevent it in the future.
Strategy for budget and targets
The only control you have as a merchant over bidding is setting your daily budget (mandatory) and a target ROAS (optional). That’s why it’s so important to choose these wisely.
By default, Smart Shopping campaigns use a maximize conversion value bid strategy. It aims to drive the most revenue possible at a given budget. It also takes into account your target ROAS goal if you provide it.
Setting a target ROAS is optional, but should you be using it? This is the return on ad spend percentage you want to see from your ads that you communicate to Google.
Google's recommendation: don't add one (or if you do, not an extreme one) because it may limit how its machine learning works.
You can let it be at first and then after a few weeks of testing and getting results see if you want to change it. Don’t set it too high because then Google might stop sharing your ads if it can’t achieve that ROAS. You might find out that some products are better staying in a separate campaign with a higher or lower budget.
Automated bidding - How Smart Shopping Campaigns Aim at Revenue
Automated, or ‘smart’ bidding strategies use machine learning to automatically set bids based on the expectancy of a search term converting. To capture the unique context of the search, the algorithm uses a wide range of auction-time signals. It takes into consideration the device used and operating system, as well as location, time of the day, remarketing list and language.
It’s quite an attention-grabbing, interesting shift in how Google approaches automated bidding strategies. Google implies its effort to find new solutions tailored to retailers. Online retail space becomes more and more competitive and Google definitely doesn’t want to be left behind Amazon.
Smart Shopping Campaigns allow for another bidding strategy, which targets ROAS. It still aims at conversion value but with more control over the ad spending. This strategy is more likely to be used by those advertisers who need to meet strict ROI targets.
By default, your campaign will have the goal of making as many conversions as possible within the given parameters (your budget, if you set up a target ROAS, etc.). When it comes to picking additional conversion goals, you have a few options.
There are a few different supported combinations you can choose:
- Just sales
- Sales and physical store visits
- Sales and getting new customers
- Sales, physical store visits, and new customers
New customer conversion goal
Wondering how the system distinguishes new users? There are three kinds of data taken into consideration and for the highest accuracy Google recommends utilize all three:
Google’s Native Data:
This will happen automatically when advertisers select the NCA target and it uses a 540-day validity period based on its own data
New customers may be tagged with a combination of the Global Site Tag and new customer parameters.
Advertisers can upload their customer list to Google Ads.
Since the bid strategy of Smart Shopping Campaigns is to maximize conversion value, it will rely on the Total Conversion Value you calculate.
In February 2019 Google published a case study with the European company Studio Moderna. Their goals were to increase their revenue and profit while making overall improvements to their current Shopping campaign.
At this time, Smart Shopping was relatively new (less than a year old). They made a great candidate for a case study since they were selling a wide variety of common household items across Central Europe.
Studio Moderna went all in on testing in their Polish and Czech markets and paused their existing Shopping campaigns there for 30 days. To make the results even more clear, they also used the same exact budget amount they had been using before.
At the end of the test, their goals were met. Their revenue increased by 76%, their conversions by 79%, and the overall ROI by 2.6X.
Because of this, they decided to use Smart Shopping as the default for all of their campaigns where available.
Google talks about dynamic prospecting in their help pages, but you may not have heard of it before. They define it as bringing “user information and product information together to show your best product at the right time to the users who would be the most interested.”
How is it different from dynamic remarketing?
Dynamic remarketing targets the shoppers and customers you already have with the goal of achieving the highest possible value from them. But dynamic prospecting’s goal is to get you new customers.
It works to show your ads both to people who have already looked at your website and those who haven't. It recommends specific products to someone who is more likely going to be interested in them.
When it’s useful
This method is useful for advertisers who are new and don’t have an existing customer base, or those who are wanting to target a different audience than you have previously.
How does it factor into your campaigns?
Google has access to a ton of demographic related data about shoppers (age, interests, household income, etc.) collected through apps and third-party data. With this data in mind, your products are evaluated for relevancy, how they perform, and other undefined factors to decide who is best suited to see your ads. The point is to intrigue potential customers by showing them items people similar to them are interested in and turn those ads into conversions.
How to add dynamic remarketing
- Log in to your Google Ads account and head over to the campaign settings
- Choose ‘Additional settings’
- There will be a drop-down menu underneath ‘Dynamic ads’
- ‘No data feed’ will be selected in this menu by default, but check ‘use a data feed for personalized ads’ instead
- Then choose the data feed you want to use and save your changes.
Check out this video for an interesting take on this topic as well as seeing Smart Shopping in action:
5 keys to a successful Smart campaign
Since Smart Shopping campaigns are automatic, it’s important to give Google all the information it needs to maximize the effects of machine learning.
Start with one product category
Google suggests you start by targeting only a specific product group, so you can leave the others running in normal shopping campaigns in the meantime. This is in order to not disrupt your normal Google Ads activities and performance.
Optimize for new customers
Using the newly added customer acquisition target allows marketers to set a separate conversion value for new customers to inform about Google's automatic bidding. Targeting new customers is beneficial because while your existing customers might have made a purchase anyway, new customers equal the possibility of additional continued purchases.
Wait a minimum of 30-45 days before looking at the data and drawing conclusions. If you are happy with what you see, you can add other product groups until you eventually add the full product catalog. If not, pinpoint what’s not working well and where you can make changes.
It could be that your headlines, ad copy, or images could use an update. Another diagnostic route to take is researching the prices of your competitors and seeing how you compare or if your discount strategy needs adjusting.
Segment your products
Forget about the old campaign priorities and product over-segmentation. Create only one Smart Shopping Campaign targeting your whole product catalog. Google will do the job for you in deciding what product to show at the right time and place.
Segment your products in several product groups, even within the same campaign and even when you are targeting the whole catalog. This way you can get granular reports and will be able to gauge campaign performance based on how product groups are doing.
Have a fully optimized product feed
This is one of the few areas you have full control over. If you already have a Shopping product feed that is fully optimized, then you already know what to do. In the next sections, we’ll look at optimization measures you can take specific to Smart Shopping.
Smart Shopping Optimization ft. Kasim Aslam
Smart Shopping is a powerful tool to use in your eCommerce strategy. Let’s talk about some best practices and how to optimize your campaigns for smooth sailing.
Be sure to always:
Run a brand campaign
You want shoppers who come in contact with your ads to be aware of your company and know who you are. Raising the amount of brand awareness and pushes your messages, URL, products, logo, imagery. All this fits into your branding and marketing strategy.
You should see your branded search increase as a result of a successful Smart Shopping campaign. It protects your brand and leads to better conversion path tracking if you don’t rely on organic searches.
Run a dynamic product remarketing campaign
In spite of what Google says, you should be running a dynamic product remarketing campaign. This will trigger ads to show people who have visited your website or used your app. Dynamic Remarketing will most likely receive far fewer impressions and clicks than Smart Shopping, but, setting a lower budget based on the comparison performance can capture the additional remarketing clicks that your daily budget from Smart Shopping may miss if set too low.
Include a lifestyle ad in the Smart Shopping ads
Lifestyle images can help your products perform better, since the shopper can see them in action.
Make sure you never:
Increase budgets until day 30 (at a minimum)
It takes this amount of time to effectively collect the data from your ads and for enough testing to be done to draw concrete conclusions.
Scale at a rate faster than 10% of daily spend
Check out our video below where we explain how to scale your campaigns in a sustainable way:
Start with a ROAS goal
While it may be tempting to add a ROAS goal right away, you should wait until 45 days after the start of your campaign. The reason behind this is to give Google an adequate learning period to work with your products and budget.
Pause your campaigns
Keep your campaigns running so that you don’t disrupt the automation and machine learning.
You must have a robust product feed
Your product data feed should be as detailed as possible and fully optimized itself. Here are some tips and key areas to focus on.
Second to images, your titles do a lot of the talking for product ads. You should put the most relevant information first without the use of over-exaggerated or descriptive language.
Robust product descriptions
Make sure that the most important information is within the first 160-500 characters so that it will be shown without users having to click on your product. Think about your potential customer's reason for wanting your product and include that in the description. Everything you write should be specific and accurate.
Examples of relevant information are:
- Technical specifications
- Special features
Relevant product details
The more information Google has to work with, the better. This can help give your products a leg up when it comes to Google choosing which products should be shown.
You can add additional attributes when they're optional like color, size, and product type.
Lots of imagery (lifestyle images especially)
Making your campaigns visually appealing is important because you want to catch people's attention and give them a reason to pay attention to your ads.
Studies have shown that lifestyle images perform better as they do exactly this and allow people to envision having the product themselves.
Optimize your feed regularly based on what's selling
Optimizing should be an ongoing process. The items that perform best might surprise you, so pay attention to your results. Remember that traffic and purchases go hand in hand.
Did you know you can have Google's Tag Implementation Team build your transaction data? And it's free for everyone!
You can also break up your products by ROAS (low, medium, high) in order to better target where your budget is going.
Shopfiy users beware:
In some instances, Shopify will automatically track all conversion actions as a conversion value (add to cart, checkout, purchase, etc.)
Consider using these unique tactics:
- Listen to all calls and import the conversion value from the call back into Google Ads. Higher priced products sell better via phone calls, so, if you can feed that data back into Google ads, it will help the campaign scale.
- Another tactic would be to pause any products that have more clicks than other products but still aren't meeting the ROAS goal. Use this tactic first as adding a target ROAS goal will limit the spend on non-tested products, which is why you want to wait as long as possible before adding a ROAS goal.
By following and maintaining these optimization guidelines, you'll be on your way to running successful campaigns.
Data feed optimization for Smart Shopping
An important aspect of optimizing Smart Shopping is feed optimization. Feed health is important since Google uses this information to determine when and where your products show up in searches.
Monitoring for warnings and errors
Catch any feed or item issues, and make sure the feed is updated regularly.
Use tips from our 10 Most Common Google Merchant Common Errors article to keep your feed healthy and to avoid errors, warnings and notifications.
By using DataFeedWatch, you can catch any potential issues in your feed before sending it over to Google. This is done through the Feed Review feature.
If any warnings, errors, or suggestions are found, you'll be given information on how to fix or improve them. This way you don't risk getting any warnings on your Google Merchant Center account.
Use Feed Rules for Testing Titles
First, set up products for your test and control groups using custom labels in your feed. Then, in the Merchant Center, set up your title test via Feed Rules.
Analyze performance by comparing:
- Click share
- Click-through rate
- Impression share
- And total eligible impressions (impressions/impression share)
Using a third-party tool like DataFeedWatch can help you easily optimize all of your product titles. You'll be able to create rules to combine elements of your feed and arrange them in the order you'd like. You can also set up A/B tests from the app.
For example, if you're selling apparel, you might set up your titles like below:
Then your new titles would be shown as 'Nike Womens Yellow Shoes', for example.
Test Smart Shopping with Custom Labels
Use custom labels in your product feeds to segment and test products to learn which ones perform better in Smart versus standard Shopping campaigns.
It’s suggested to use custom labels to isolate higher performing or popular products with segments such as:
- Top products
- Most reviewed products
- Gateway products
- Price position
If you're using a third-party feed management tool like DataFeedWatch then you can segment your products by creating rules. For example, you can create a rule to separate products by profit margin. Here's how it would look:
The Pros and Cons of Smart Shopping
There are a lot of opinions when it comes to using Smart Shopping, so it can help to see a pros and cons list to decide if and how you want to use it. Let's take a look.
- You will save time with campaign maintenance
- Benefit from Google's machine learning and algorithms
- It's easy to set up
- Aren't able to use negative keywords
- Less control than standard campaigns
- May not have enough data if you're selling very niche products
The key to adding value and getting more out of your Shopping efforts starts with understanding how Smart Shopping works. Google is giving advertisers more and more access to machine learning but that doesn’t necessarily mean better results.
What does it mean in a nutshell? Surely less time spent managing accounts and possibly better results. At the very least it gives a chance to A/B test campaign performance and go from there.
The mysterious nature of Smart Shopping campaigns makes some advertisers hesitant to try them, however the potential lift in performance makes them worth testing.