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An Advertiser’s Best Friend - Product Listing Ads in Focus

Posted on 12.13.2012

Diamonds are a girl’s best friend and dogs are said to be a man’s, but what can a merchant depend on? Simple – Product Feeds.

This jam-packed data file contains all of a retailer’s most valuable product information. Merchants can then use these feeds to insert their products “automagically” within a multitude of channels, including comparison shopping websites, various marketplaces and affiliate networks. And now, thanks to the transition from Google Shopping, merchants can also leverage their product feed data for Google’s Product Listing Ads (PLAs).

What are PLAs?

The PLA format allows merchants to include descriptive product information, such as an image, title, price and business’s name, into a productspecific advertisement. When consumers conduct product-related searches, PLAs are displayed within a sponsored section on the search result pages. So far, these ads have proven to be a good investment for merchants. In fact, a recent Kenshoo study found that on average, Google’s PLAs receive a 73 percent higher click-through rate than text search ads, a 35 percent higher conversion rate, a 36 percent lower average cost-perclick rate and a 46 percent higher return on ad spend rate (source: http://wsm.co/U7d9kw).

In order to garner these types of results, however, merchants must first make sure their entire product feed data is up-to-date, and then link their Google Merchant Center and Adwords accounts. This is because PLAs are managed in AdWords, while the product information is managed through Google Merchant Center. After both accounts are linked, merchants can focus on optimizing their ad groups, launching their campaigns and measuring the results.

Optimizing Ad Groups

Merchants should focus on building PLA ad groups that highlight their best-selling products, brands and categories. Since merchants can rely heavily on these items’ popularity, it gives them a better chance of converting interest into sales.

It is important to note that instead of traditional keywords, PLAs use product “targets” to determine when items will appear on search results pages. In order to control which products are eligible to appear in the PLAs, merchants must use product filters. That being said, the best way to ensure that the correct products are being displayed is by creating very specific ad groups. Let’s take a “footwear” ad group as an example. Merchants could either create a product target for “footwear” or a specific product target for, say, men’s Nike running shoes. By narrowing down the gender, the brand and the sport, the PLA will be displayed on more specific search queries, and therefore have a better chance of resulting in conversions than its vague counterpart.

Merchants can further control which searches their PLAs show up in by using Google’s negative keyword feature. This tool allows advertisers to exclude specific words from their PLA campaign so that their products aren’t displayed for irrelevant searches. For instance, a merchant who exclusively sells dog collars could exclude the keyword “cat” so that their PLA would show up during a search for “collars,” but not during a “cat collar” query. Tracking Performance Once the ad groups have been optimized and the campaign has been launched, the only way merchants can achieve success is by monitoring their results.

While this can be accomplished by analyzing metrics like conversions, merchants should also pay close attention to their top-performing ad groups’ average position. This is because the fluctuations of a merchant’s average position can help them identify if other sellers have increased their bids. If this is the case, merchants can stay competitive by adjusting their bids accordingly. However, it is important to remember that some ad groups are more competitive than others, which means that it may not be in a merchant’s best interest to increase bids if it will negatively impact their bottom line.

Merchants should keep in mind that PLAs are still an evolving ad format. As such, they should continuously modify and test ad groups and bidding strategies to discover the options that provide their business with the best results.

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