Following up our Programmatic Google Shopping case study, this article has been refined to help online sellers (brands, resellers, distributors and manufacturers) understand the basics of Google Shopping.
Google is the number one website in the United States, and a growing platform for ecommerce. Google Shopping (formerly "Product Listing Ads" or "PLA") represents a major opportunity for online retailers to grow sales and build their own branded ecommerce business. This post will help you understand the opportunity and nuances of using Google Shopping.
|Channel (US)||Monthly Unique Visitors||US Rank|
Source: Quantcast last updated April 21, 2017
Cost Per Click (CPC)
Unlike Amazon, eBay, and Jet.com which charge a marketplace commission (roughly 10-15%) on a per order basis, Google Shopping operates on a CPC model. This means merchants must bid for superior listing presence relative to competing merchants.
Having the lowest price is not what gets your Google Shoping listing the "Shop" button.
or to the top of their merchant listing table....
Having the highest bid does not always get you the best placement. A combination of the following factors determine your Quality Score:
- Expected clickthrough rate
- Ad relevance
- Landing page experience
Learn more about Quality Score.
How To Bid For Google Shopping
Some merchants use Google Shopping to make money and acquire customers. Some merchants use Google Shopping to acquire customers, even if that means taking a loss or just breaking even.
The amount you can bid depends on two critical factors:
- Conversion rate
- Per item profit
Profit x Conversion Rate = Breakeven CPC
So, as a basic example, let's say you have your own webstore - SweaterLove.com - where you sell the most amazing sweaters. You have a red sweater that you make $5 on per order including your shipping cost, and out of every 100 visits to that product page, 3 customers buy an average of 1 unit.
$5 (profit) x 3% (conversion rate) = $0.15 Breakeven CPC
In future posts we'll share insights for increasing your conversion rate and increasing your profit margins.
How to get started with Google Shopping
It's a 3-step process:
1) Set up your Merchant Center account.
2) Upload your products ("Google Shopping feed").
3) Create a Shopping campaign in AdWords.
From soup to nuts, Zentail offers implementation and optimization of your Google Shopping campaigns. Learn more in our Knowledge Base.
Zentail and Google Shopping
Zentail centralizes your product catalog and inventory and continuously updates Google Shopping with your optimized catalog data and available inventory. We dynamically adjust your CPC bids based on the data we continuously collect. We make it easy to get maximum exposure of your catalog on Google Shopping while preventing over-selling and over-spending.