Product Listing Ads: The A-Z Guide for Boosting Sales Using Ads

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Product listing ads are also known as PLA ads or Google Shopping ads. In short, they're online advertisements that companies pay for on a cost per click (CPC) basis. Therefore, if your online store were to take out a product listing ad on Google, you would only pay for the times when a user clicked on that ad. No payments are made when users see the ad but don't decide to click.

In general, merchants purchase these product listing ads through Google AdWords. It's the most popular ad network in the world, but there are some smaller ones you can also look into.

You don't have to pay anything to signup for AdWords, so the only costs that come in are when users make those clicks. As for the location of the ads, they're placed on the side of Google search results and on the top.

Here's an example:

If someone were to search for cheap futons (and you target this keyword,) your ad would be placed before, or to the side, of the natural search results.

The best thing about product listing ads is that Google does a great job at making them look as natural as possible. It's true that Google places a little “Sponsored” tag by the product listing ad, but it often goes unnoticed and many customers don't even care about that.

However, product listing ads use images, so they do stand out a bit compared to standard AdWords advertisements.

What's the physical nature of a product listing ad?

product listing ads

Compared to other online and offline ads, Google Shopping ads have the following:

  • A product image
  • Some sort of product information like the price.
  • They're focused more on products and product categories as opposed to specific keywords.

The reason I'm talking about the differences is that although you use AdWords to setup product listing ads, regular AdWords advertisements are quite different.

AdWords ads typically only contain text, and they can have other elements like a more extensive description. Adword advertisements are shown below:

Some Other Differences Between Standard Google Ads and Product Listing Ads

It can get a little confusing since both types are created and managed in the AdWords interface. However, AdWords also has a section for Google Shopping. This is where you'll handle your product listing ads.

So, technically regular Google ads can be used by all companies and organizations, from blogs to small retail businesses. But the Google Shopping product listing ads are only for those brands selling products online.

Finally, the fees for product listing ads are based on which ads groups (for products and products categories) you choose to bid on. Regular AdWords ad costs are based on which keywords you bid on.

So, for a product listing ad, you might bid on a category like “Jackets” or “Jackets under $40,” where an AdWords ad has all sorts of keywords you could bid on, like “buy men's blue jackets.”

How Much ROI Can You Expect From Product Listing Ads?

Well, there's no way to project the ROI for every person reading this article.

However, I can give you some tips for increasing your ROI:

  • Consider posting product listing ads once your store starts selling over 500 items. You're going to have a much better time seeing results since Google is able to serve up a wide range of options to customers. It's not a bad idea to try it out if you have a smaller store, but a shop with 10 items isn't going to get much exposure (unless those items are extremely popular).
  • As you get used to the Google Shopping interface, expect to increase your spending limit. You should start to see returns that make up for this increased budget. The problem occurs when companies don't ever increase their budgets. It's limiting to your potential growth.
  • Make sure your website is amazing. If Google notices your visitors leave within ten seconds and don't buy much, it's going to stop serving up the ads.
  • If you have extremely small margins, Google Products is most likely not right for you. The only advice we can give is to keep the budget low as to not blow your margins.

Major Brands That Use Product Listing Ads

Tons of big brands use product listing ads. In fact, you could argue that they'd be silly not to. Most big brands have the budgets to play around with these ads, and they have the large inventories to serve up ads at all times.

For instance, a quick search I made for power tools revealed Google Shopping ads from Home Depot and Target.

A “kids clothing” search brought up the Gap and Abercrombie & Fitch.

Big name brands use these ads, and that's one of the main reasons it can work for smaller online stores. Your money is just as good as theirs, and with this, you don't have to compete on SEO.

How to Setup Product Listing Ads

Before creating your ads, a few steps have to be completed in order to pull the right information from your store.

Trust me, you got this.

Step 1: Create a Google Merchant Center Account

Go to the Google Merchant Center Website. There's a chance you already have an account, so either sign in or create a new account. The reason you'll need a Google Merchant Center account is because the dashboard lets you link to your ecommerce account and regularly import product data. This way, you don't have to do it manually.

It depends on the platform you're using, but for Bigcommerce, all you have to do is go to the app store and install the Google Shopping app.

Other platforms, Shopify, require you to import product data with a data feed. There's a great guide on how to do that here, and the video below provides a quick explanation from Google:

Anyway, right now we only want to link your Google Merchant Center account to your AdWords account.

You can link the accounts in either AdWords or the Google Merchant Center, but since we're currently in the Merchant Center, let's do it there.

Start by clicking the triple dot button in the upper right-hand corner of the dashboard. You'll see an option for Account Linking. Click on that.

The account linking page should reveal an option to link to your available AdWords account. If you don't see an account, it's most likely because you're not logged into both AdWords and the Merchant Center using the same email.

Click on the Link button. This should take no more than a few seconds and reveal a change to Linked status.

Step 2: Create a New Shopping Campaign

Navigate to Google AdWords and select the “+Campaign” button. Below this, you'll see a list of all past and current campaigns, but you can ignore these for now. There's also a chance that this list is empty.

After clicking the button, a few options appear since there are several campaigns you can run. For the Google Shopping ads we're talking about today, you're going to want to click on the Shopping option.

Step 3: Make a Campaign Name and Set Shop Settings

This brings you to the campaign settings page, where you create a campaign name that's easy to remember. It's important to realize that you may end up having multiple product ad campaigns in the future, so you need to distinguish between all of them.

The Shopping type is already selected for you, but there is also the option to load settings from an existing campaign. This speeds up the process in the future, but it's not necessary right now.

The merchant identifier is also loaded since we linked the Google Merchant Center account earlier. Make sure you select your country of sale. After that, you'll see some advanced Shopping Settings. This has tools for filtering, setting local inventory ads, and for campaign priority. None of them is all that relevant if you're only doing one campaign, but the campaign priority is great for when you have multiple campaigns running.

For instance, a store may have several campaigns running for one product category.

In that case, the store probably wants to run one over the other, or maybe test out which one works the best. So, you can set it so that one has priority over the other.

Step 4: Walk Through the Defaults

This area of the settings page is pretty much all set for you. The networks field checks off the Google Search Network and included search partners. This gives you the most exposure.

The Devices section specifies that all compatible devices which will display your ads. So, if someone completes a Google search on a smartphone or tablet, they will still be able to view your ads.

The Locations section is one of the most important since there's a chance you don't sell to people outside of your country.

For this example, I'm only targeting customers in the US and Canada. However, a global online business could choose all countries and territories, or you can even type in your own country to target one.

You'll also find an Advanced Locations Option section, where it asks you exactly who you would like to target based on your previously set location settings. So, for instance, my hypothetical company only sells to people who live in the US and Canada. Therefore, I would most likely switch it to “People in my targeted location.”

Step 5: Set Your Bid and Budget

Most of the time you'll choose the manual CPC option, so you can leave that for now. This means that you get to set your bids manually and let them run as long as you like. There's a more automated version that Google provides, but that gets tricky when you're on a budget.

So, skip to the Default Bid field and type in how much you would like to bid for each ad. There's a thorough explanation of how this works when you scroll over the “?”.

As for the budget, this all depends on how much you're looking to spend.  With a well-planned campaign, I would consider starting out with a $10 per day budget. Just keep in mind that Google might go 20% over that budget if it feels the ads are doing well at that point.

Once that's completed, hit the Save and Continue button.

You can also see a Schedule option under the Advanced Settings. Although you don't have to do this, I find that setting a start and end date is a great way to keep tabs on your budget.

Step 6: Set Product Groups

The next page asks whether or not you would like to create multiple product groups based on the product attributes you choose.

You have that option, but most people will start simple and go with the one product group with a single bid for all products. After that, you can start separating everything into different groups.

Step 7: View Your Campaign

Once your campaign settings are complete you can view that campaign on the main list.

Keep in mind that if you haven't linked to your Bigcommerce account in the Google Merchant Center, or you haven't set up your product data feed for any other eCommerce platforms, the campaign won't start.

Once the campaign has begun, you'll able to view prime metrics such as clicks, impressions, CTR, average CPC, and the total cost of the campaign.

That's It! Are You Ready to Start Making Product Listing Ads?

Google Shopping ads are far less intimidating than they seem. In fact, it's rather simple once you get that product data imported into the system. You don't have to design the ads like you typically would have to in Google AdWords, and it's entirely up to you to figure out the budget you would like to set.

As for handling your Google Shopping ads, we recommend starting with only one product group, but after that, you're more than welcome to expand and test out which product group and categories work the best.

All of the stats are available for comparison in the dashboard, so it's pretty clear which products are performing the best.

Get ready to increase conversions using product listing ads! Share your insights by leaving a comment below.

If you have any questions about how to setup product listing ads, or if you have any advice to give newbies to the Google Shopping interface, feel free to do so.

Feature Image by Ismail Pelasayed

Joe Warnimont

Joe Warnimont is a Chicago-based writer who focuses on eCommerce tools, WordPress, and social media. When not fishing or practicing yoga, he's collecting stamps at national parks (even though that's mainly for children). Check out Joe's portfolio to contact him and view past work.

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