Top 5 Google Shopping Bidding Strategies

Struggling with Google Shopping’s new structure? Our partners at GoDataFeed explain recent changes and 5 Google Shopping bidding strategies for growing your campaign.


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If you’ve ever listed your products on Google Shopping, then you already know that it’s an increasingly important shopping engine for driving consumers to your Volusion store.  To help you convert your Google Product Listing Ad (PLA) campaigns from the old structure to the new Shopping Campaign structure, the feed management teams at GoDataFeed and Operation ROI have assembled some hands-on tips to make the switch as smooth as possible.

Goodbye Ad Groups, Hello Product Groups

Previously, PLAs allowed you to create ad groups by choosing product attributes from your data feed which gave you a lot of freedom on which ones you could use for your ad groups. Shopping Campaign product groups, on the other hand, don’t build out from your store inventory data feed, but instead segment your inventory for a more streamlined organization. Think of the new product group structure as big buckets that contain smaller buckets. The main product group will be the largest bucket containing smaller buckets for better segmentation and control.

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Product Groups are based on any attribute you choose: Brand, Item ID, Custom Label, Product type or Google Product Category. We recommend you begin structuring your product groupings beforehand and utilizing analytics data to ensure the product groups are set for the best possible return on investment.

Custom Labels vs. Adwords Labels

Custom labels are a new requirement for data feeds, replacing AdWords labels used in Product Listing Ad (PLA) campaigns. There are similarities between the feed labels, such as both being used to mark product attributes and build ad groups.

However, Custom Labels limit you to five, (0-4), which, consequently, also limit the number of Product Groups (ad groups) that you can create with AdWords. The benefit of this change is that Custom Labels work in conjunction with the Product Groups to provide you a better way to segment products.

5 Bidding Strategies for Google Shopping Campaigns               

There are 5 basic bidding strategies for managing Google Shopping Campaigns. Before you launch the shopping campaigns, it’s best to review your products and think about how best to categorize your products for bidding purposes. Don’t forget to take advantage of the Custom Labels, which will give you the ability to add your own segmentation choices to your feed.

  1. Category / Brand Based Bidding:

One of the most common practices when starting out working with Product Groups is segmentation by category or brand. Since “brand” is an attribute in the Google feed and is available with the product groups selection, this may be a good place to start. Google also provides basic categories for segmentation, so this is another way to split up your groups. Whichever you choose, you can always segment further within each Product Group.

  1. Performance Based Bidding:

Bidding by performance is also a common strategy when working with Google Shopping Campaigns. One of the nifty features of the new shopping campaigns is “Campaign Priority” which allows you to have multiple campaigns advertising the same products.

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Tip: Prioritize your Bids

Since, by default, the priority is set to “Low” for all campaigns, the ability to give certain campaigns a higher priority allows you to promote higher-performing products. In some cases we have even moved all the campaigns to “Medium” priority, thus enabling merchants to demote underperforming products without removing them completely.

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  1. Price-Point Based Bidding

Another way to segment your products is by price-point. For many websites, the product offerings prices can vary greatly from $10 to $2000. For this reason, bidding tactics on the $10 products should vary greatly from the $2000 products when trying to maintain performance goals. Google does not provide any way to segment by price, so you should take advantage of the custom labels and break your products into price buckets that make sense for your offerings. This bidding strategy allows you to maintain the necessary ROI goals for each of the price buckets.

Tip: Combine Custom Labels

To set up custom labels based on price point and brand in the feed using GoDataFeed , we’ve set the rule for Custom Label “0” products to include all Nike Shoes that are priced higher than $85 (see example to the left).

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  1. Margin Based Bidding

Another strategy similar to segmenting by price is segmenting by margin. The structure is almost identical to bidding by price, but the Ad Groups or Product Groups are based on margin percentage. The only challenge in using this method is that you need margin data for every product you offer.

If you have margins from 10% to 70%, setting up Ad Groups based on the potential revenue made when the individual products sold. If any margin group is not performing, you can pause it or lower the bid significantly.

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  1. Seasonality Based Bidding

This bidding strategy seems to get over looked by many of our clients, but can actually make a huge difference to ROI goals if you understand your products seasonality. We have a client who sells products like wet suits, ski gear, winter apparel, and other outdoor related products. In this case, it is very important to understand what times of the year their products sell best.

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One important reason to segment in this manner, as opposed to removing the seasonal products, is that during the off-months you can still list the products; however decrease the bids significantly to keep your overall ROI in check.

Recap:

While all of these strategies will work well if implemented and monitored, it is important to figure out a good starting strategy prior to launching Google Shopping Campaigns. It is also important to understand Custom Labels, Campaign Priority and how to use Negative Keywords, as all of these tools will help make your campaigns more successful.

Migration Tips:

  • Don’t go live with your new Shopping Campaigns while still running legacy PLA Campaigns
  • Make sure to keep your data feed fresh and up-to-date with the new feed requirements
  • Use consumer-friendly titles, descriptions and images to increase click-through rates; titles can now contain up to 150 characters and descriptions up to 5,000 characters
  • Take your time & structure for success: Product Groups and Custom Labels are the building blocks for great performance

After you have your data feed for your new shopping campaigns properly formatted and optimized, you will need to utilize your previous analytics data to set bids for the new structure of your shopping campaigns.

GoDataFeed and Operation ROI have co-authored this article to help retailers migrate and optimize bidding strategies for the new Google Shopping Campaign structure. In addition to this post, we have created a more in-depth Google Shopping Campaigns White Paper and co-hosted a joint webinar on the topic; Webinar Recording and Slide Deck, both available online.

One Response to “Top 5 Google Shopping Bidding Strategies”

  1. Lex Urquhart

    I know this article is nearly a year old, but I did want to raise a point here. In your example of “Combine Custom Labels,” shouldn’t the “OR” be set to “AND” to make sure both of the rules need to be triggered?

    Reply

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