A Simple Overview of Product Listing Ads

You have an e-commerce site? Are people searching online for the products you have on your site? If you answered yes to both, there is no good reason why you are not running Product Listing Ads (PLAs) on search engines (Google now, Bing soon). The fact that PLAs can show images of the exact product a searcher is looking for with an exact title and competitive price gives them a distinct advantage over other listings in the search engines. Namely, if the searcher typed in the exact product name, these ads are serving them the exact result they’re looking for. This is exactly the purpose of search, isn’t it?

As would be expected, all the case studies I’ve seen about these ads up to this point have shown better overall performance for search queries than paid search text ads. While they are more complicated to set up and run campaigns for than traditional keyword campaigns, this can be used to your advantage. This is because PLAs require that you learn how to set up and optimize a data feed, as well as learn how to set up campaigns and control ad serving within Google. The time and energy this requires just means more of your competitors are likely not implementing these types of ads themselves, or are doing a less-than-stellar job of it. This can provide you with a great opportunity in this space if you’re willing to do what it takes to be great there.

What They Can Do

The impact on traffic and conversions has been shown to be highly incremental. This means that it is mostly results that are above and beyond what you would attain from text ads and organic search results alone. This could be in large part because of their highly relevant nature and the fact that they are graphically more eye-catching. When you can serve a searcher an ad that is the exact item they are looking for and include a price, they will be more likely to convert. Therefore, the better you can control this within your campaigns, the better you’ll do.

As of March 2013, we are seeing upward trends in CPCs because of advertiser adoption. But, they still perform better than text ads. Despite increased competition, you can see over 20% higher ROI from PLAs than non-brand text ads.

How They Work

In order to make sure you are taking full advantage of these types of ads, you must know the details about how they work. Here are some you’ll need to know…

• The Data Feed. PLAs require you to learn how to set up and optimize your product data feed to Google Merchant Center just as much as knowing how to control your product/query matching in AdWords. For a more detailed breakdown, see the Total Guide to Setting Up Your Data Feed.
• Targeting. There are no positive keywords. To me, this is the worst feature about these campaigns because it takes away a lot of your control over how your products are targeting to queries. The only way you can control this is post-ad serving, when you look at historical search terms and then add what is appropriate as negative keywords. The problem is your products have already shown on search terms that Google deems to be relevant, but don’t truly match the search query performed. This creates a lot of time and optimization for you that could be avoided if Google would allow you to use keyword matching at the start. A little bit of me dies inside each time I look at the search query reports from the beginning of new campaigns.
• Messaging. Each ad includes one promotional message. If you have a USP that is attractive to searchers wanting the specific product, it would be good to include that here. Overall, you can test these messages just like you would test text ads for performance.
• Ad Positions. There are none. In most formats (these are still being tested and won’t always be the same) five products will show beneath the banner, all in a row. So you’re aiming for increased impression share if you want to improve volume, not ad position.
• The Auction. When a user does a search that Google deems product-related, your feed will be scanned for products that match the search query used. Any matching products will then enter the auction. Since Google takes historical and predicted performance into account, the system will adjust over time to how it matches your products with queries.

Management Tips

• Campaign Organization. This may be the most critical part to your success. Here’s a simplified version of how you I typically set up campaigns for PLAs.
  • All Products Campaign
    • All Products Ad Group
  • Specific Themes Campaign
    • Theme 1 Ad Group
    • Theme 2 Ad Group
  • Specific Products Campaign
    • Product 1 Ad Group
    • Product 2 Ad Group
• AdWords Labels. Once you review the details about setting up your feed, you will find an attribute called adwords_labels that allows you to cluster your products according to your campaign organization so that your products show in the right ad groups. Carefully apply this attribute to match your campaign structure.
• Negative Keywords. Since there are no positive keywords, this is your only option to make sure the right queries get matched to the right products. If you have a product with its own ad group, you don’t want it matched to a theme or the All Products ad group. Therefore, you want to exclude all specific search queries that apply to that product from being served everywhere else. What you should be left with is an All Products ad group that attracts search queries that don’t apply to a specific product or keyword theme you already have an ad group for. The Theme ad groups should only attract queries that include the keyword theme, but not the specific products. Lastly, the Specific Products ad groups should only attract queries that refer to the specific product being served in the ad.
• Tiered bidding. Remember, the more specific your ad is to the query, the better you’ll do. Therefore, it makes sense that your bids will be different. For most products (it all depends on your profits for each product), your bid will be higher for its ad group than for its keyword theme or the All Products ad group. So, you might end up in a situation where a specific product has a $1.50 bid, the theme of that product might have a $1.00 bid and the All Products ad group might have a $.50 bid.
• Bid Experiments. Performing bid experiments with the ACE (AdWords Campaigns Experiments) feature will allow you to get a sense of the levels at which you can maximize your profits for each ad group.
• Keyword Mining. Use search queries you find from PLA campaigns and build text ad campaigns from them to expand your reach.

Now you have an idea of what this ad type is and how it can help build an e-commerce business. If you have a site that sells specific products online, you would be well-served to make sure you pay special and close attention to PLAs, as they have become the foundation to any e-commerce search strategy.