How to Analyze & Optimize Your Google Shopping Campaigns: Your Complete Guide

If you are an eCommerce business owner, you most likely realize that Google Shopping Ads could be your golden ticket to reaching your ideal customers. After all, they drive 76% of the eCommerce industry’s search ad spend.

And why not? 

With Google Shopping Ads, you can ensure that your products are reaching those who truly need them. Even better, unlike regular Google Search Ads that are solely text-based, Google Shopping Ads have the advantage of the visual medium that attracts a higher number of clicks and conversions.

But simply because Google Shopping Ads have the potential of fetching such amazing results does not mean they are a breeze to work with. Achieving good results is more than just about setting up your campaigns— you need to constantly monitor and analyze your data so that you can optimize it.

So here’s how you analyze and optimize your Google Shopping Campaigns to make them a wild success.

What Does Analyzing & Optimizing Your Campaigns Mean?

When you are dealing with Google Shopping Ads specifically, being mindful of your campaign’s success and profitability becomes more important than ever before. 

This is because with a conversion rate that beats search ads by 84% and display ads by 112%, it is very easy to become misled about your campaign’s actual success.

However, just because you are getting better results than other types of ads does not mean that you are getting the best results.

So if you are running campaigns, especially with high budgets, without properly monitoring and analyzing your ads, you are at risk of unnecessarily losing out on a lot of money. After all, a poorly optimized ad campaign is money left on the table.

But what does analyzing and optimizing your campaigns even mean? The easy answer is a lot of things.

On the one hand, optimizing your Shopping Campaigns can be as simple as a couple of quick fixes that create an impact on the big picture. These are fairly easy tactics and tips to implement on your Shopping Ads and help them perform their best.

On the other hand, however, these tips will not take you very far because of their generic nature. You need something more personalized that pays attention to the finer details. 

This is where analyzing your Shopping Campaigns becomes more important than ever— by looking closely at the smaller details, you are able to tweak your campaigns to perfection.

But how do you make things work in the big picture as well as the finer details? Let’s find out…

The Big Picture

When it comes to optimizing your Google ads, there are a number of tactics that you can use to make sure that they are performing at full capacity. 

Whether it is ensuring that your Google Merchant Center has all the necessary information or going through your product feeds to ensure that there is nothing missing, there’s a lot that you can implement to make the best out of your Shopping Campaigns:

1. Structure Your Campaign Wisely

One of the most basic yet underrated tips to optimize your Shopping Campaigns is to structure them wisely, and more importantly, strategically.

A common mistake that many eCommerce brands make is to create a single, undivided Ad Campaign with no grouping or segregation with it.

Now, of course, this is a perfectly valid approach if you want to keep things simple and don’t mind losing out on some easy money. 

But if you want your business to achieve peak digital marketing success through Shopping Ads then this structure is going to get you nowhere.

This is where separating your Product Groups can help.

Separating your Product Groups is vital for ensuring that you make the most money out of your efforts. 

This is because, with separate Product Groups, you can finally adopt a manual bidding strategy and set different bids for different Product Groups.

While automated bidding is an easy person’s way out of the path to glory, a manual bidding strategy allows you to really think about how you want to invest your money in advertising your products.

Google offers 8 different attributes for creating Product Groups:

1. Item ID
2. Brand
3. Category
4. Product Type
5. Custom Labels
6. Condition
7. Channel
8. Channel Exclusivity

With these labels, the easiest Shopping Campaign strategy you can come up with is to divide products based on their popularity. This will allow you to be more savvy with your fund allocation and make the most out of the money invested.

You will now be able to put more funds towards a higher bid for more competitive products. At the same time, it will also stop you from wasting money on products that have lower demands.

A more advanced strategy that you can try out, and which we often use here at Yoru Marketing, is to segregate your Product Groups by Item IDs. This is a far more granular approach that you can surely consider as you get the hang of Google Shopping Ads.

Lastly, if you are looking to optimize your Smart Shopping Campaigns, segregation can help you here too. The best way to go about it would be to use winners, losers, and profit margins as the three most important bases for creating Product Groups.

But if you want to take things up a notch, you can even create different Shopping Campaigns for different products altogether. 

This strategy can come in very handy in ensuring that the majority of your funds are allocated to products that have a higher demand and will get more clicks.

After all, with different Shopping Campaigns, you can now set different bids and different budgets. By separating your products into different campaigns based on their demand, you can set a higher budget for products that you know are going to get more clicks.

Sounds like a sweet deal to give your Shopping Ads a boost, right?

Except this is not all— an advanced strategy still exists.

So far, you’ve tried dividing products into different groups and campaigns. But what if you created multiple Shopping Campaigns with the same products?

It might sound nonsensical at first but this is one of the best strategies out there to squeeze out value from every last cent you spend. This is because it allows you to even go so far as to leverage your search queries to bid effectively.

You see— there are certain search queries that are bound to generate more clicks. One example of such search queries would be branded search queries.

The best way to explain branded search queries would be to consider this example— let’s suppose that you have an eCommerce brand selling shoes, particularly a pair of Nike sports shoes. 

These shoes pop up on people’s Search Engine Result Pages (SERPs) for search queries such as “sports shoes” as well as “Nike sports shoes.”

Which search query do you think will have a higher number of clicks and conversions? The second one, of course, because it is specifying the brand too. 

This is what is called a branded search query and it has a much higher chance of getting your ad a click than general queries.

In such a situation where the same product can appear for both branded as well as general search queries, creating separate campaigns for the same product can be one of the most profitable strategies to make your returns shoot through the roof.

This is because it will allow you to allocate more ad spend towards branded search queries that are bound to convert more.

So you have structured your campaign— now what?

This would be testing. Thankfully for you, testing your ads does not take a lot of effort.

A majority of your campaigns can be tested with two simple general testing campaigns.

Another alternative would be to set up a Smart Shopping Campaign (or standard shopping) with separated Product Groups. Doing either of these will give you a pretty good idea of where you stand.

2. Optimize Your Product Feeds

Did you know that Google Shopping Ads do not make use of keywords for displaying your ads to relevant users? 

Instead, all the information that you feed into the Google Merchant Center in the form of product feeds is what is used to display your ads.

This means that you need to be extra careful when crafting your product feeds to ensure that you do not miss out on or mess up some vital details. 

The first step towards this is to make sure that you are complying with all of Google’s policies in terms of the format of the information.

Remember: If you compromise on any of Google’s policies, your eCommerce brand’s Ad Campaigns can actually face suspension. To explore more about the various reasons for these suspensions, check out this video.

In order to optimize your product feeds, the key areas that you need to focus on are images, titles, product descriptions, prices, and website links. 

The last two areas are fairly easy to optimize since all you need to do is enter correct and valid information.

This means that the price you list in Google Merchant Center should match the price on your website. After all, Google takes great pride in displaying correct information to its users and would not take kindly to any inconsistencies that could mislead buyers.

Apart from your product prices, your website link is another important yet easy to optimize aspect. 

This is because you do not need to do anything apart from ensuring that your product’s landing page is not broken or leading to an error page. 

Hot Tip: If these minor tasks feel too tedious to you, we recommend you check out the Simprosys Google Shopping Feed App. With this simple app, you can automate these small tasks and get ready to go as soon as possible. 

But stop— there are other factors that need effort too. One of them is your product image.

Optimizing your product images is a matter of hitting and trying constantly to find out which type of product image helps you stand out the best. 

This is because different types of product images can produce different effects on your target audience under different circumstances.

Suggestion: If you are struggling to optimize your product images, we recommend going through this video from the 7 minute mark to get our secret sauce for the perfect image optimization strategy.

One way of understanding this is to look at the example below.

When we search for the keyword ‘bracelet’, several different Shopping Ads pop up. Yet, it is only Shane Co’s ad that catches our attention. 

This is because having a lifestyle product image clearly sets their product apart.

On the other hand, if we look at a different example, we will notice that the pattern changes.

For better understanding, here’s what shows up when you Google ‘marathon shoes’:

For this particular search result, the ads by Brooks Running and Zappos stand out the most. 

This is because their products are positioned in the image differently from their competitors. While Brooks Running has kept its shoe at an angle, Zappos has shown both shoes as a pair.

The bottom line is that the strategy adopted to optimize the product image completely changes.

In short, optimizing your product images is not about the type of product image you choose but more about what will help you stand out.

The next factors on the list are your product title and description.

While a picture can speak a thousand words, it does not mean that your actual words do not matter. 

What you include in your product title and description can go a long way in not just catching the attention of the users, but even making sure that your ads are being displayed to the right users in the first place! 

This is because these two components form the basis for deciding who is shown your ads. 

The information that you feed for your product title and description is what helps Google in figuring out who would be best interested in your products. 

If your titles and descriptions are not accurate, keyword-rich, and illustrative enough, you can miss out on tons of opportunities to show up on the search result pages for different keywords.

Bonus Info: Find out how to enrich your Ad Campaigns with the right keywords through this video.

Lastly, keyword enrichment is not the only important aspect of your product titles and descriptions either. 

Since your target audience reads these areas too, you need to make sure that you do your best to grab their attention and influence a click too. 

After all, there is no point in showing up for all the relevant keywords if your product titles and descriptions do not make your ideal buyers want to click to explore further.

3. Don’t Forget Your Negative Keywords

Like we have already mentioned, Google Shopping Ads do not rely solely on keywords to display your products to users. 

Instead, the data that you enter in your Google Merchant Center forms the backbone for determining when and where your ad will appear.

However, this does not mean that keyword research is off the table. 

Since you are no longer in charge of targeting the keywords your ads appear for, the chances of appearing in irrelevant search results are higher. 

After all, the keywords you show up for are now completely dependent on the data Google pulls out from your Shopping Feed which has a greater margin for error.

This is where negative keywords come in.

They form a vital part of optimizing your Shopping Campaigns by preventing you from wasting money. Unlike regular keywords that are meant to be targeted, negative keywords are the keywords you want to avoid.

A simple way of understanding this would be to assume that you are an eCommerce business owner who sells silver jewelry such as earrings, pendants, and bracelets. 

In such a situation, appearing in searches such as ‘gold bracelets’ would be a clear waste of money for you since any clicks to your website will not get sales from the users who are looking for gold jewelry.

By simply adding the word ‘gold’ to your negative keywords list as phrase match, you can save a lot of money by ensuring that your products only pop up for ads that have a chance of getting you sales.

But, wait. It gets better.

You can subdivide your keywords too!

You now know that you can make sure to avoid the keywords that are irrelevant to you. However, what if a particular negative keyword was only irrelevant to certain product categories?

Let us revisit the example from earlier.

Suppose, again, that you are an eCommerce business owner selling silver jewelry. 

Keywords containing the word ‘gold’ will be of no use to you under these circumstances. But what if your silver pendants showed up for a keyword such as ‘silver bracelets’? 

This will, again, result in you losing money on useless clicks.

Thankfully, you can also subdivide your negative keywords such that certain keywords will only be avoided for specific ad groups. 

In this example, you can add the word ‘bracelets’ to your list of negative keywords for the ad group containing your silver pendants.

This is the difference between universal negatives and ad group negatives.

Your universal negatives are negative keywords (here: ‘gold’) that you want to avoid across all ad groups because they would not be relevant to your products under any circumstances. 

On the other hand, your ad group negatives (here: ‘bracelets’) would be negative keywords that are irrelevant to only certain categories of your products.

Once you have come to terms with the importance of negative keywords, the next question that arises is how do you find and add them to your Google Shopping Campaigns.

Adding your negative keywords to your campaign is very easy and only takes five simple steps:

1. Enter one of your Ad Campaigns by clicking on it.
2. Enter your ‘Keywords’ tab in the page menu
3. Click on the ‘+’ button to start choosing your negative keywords
4. Choose ‘Campaign’ or ‘Ad Group’ from the drop-down menu to select the campaign or ad group you want to target
5. Make sure to only add one keyword in each line of the text field
6. Make sure to click on ‘Save’

The real question that now arises is how do you locate your negative keywords? The answer lies within your campaigns itself.

The best way to locate your negative keywords would be to go through your campaign. Any irrelevant keywords that are causing you to lose money would be your negative keywords.

Apart from this, the Google Keyword Planner is also an amazing solution for figuring out your negative keywords. 

All you need to do is enter your broad keyword into it and you will get a list of several related search terms— many of which might end up being irrelevant to certain ad groups of your entire campaign.

Lastly, keyword research tools such as Semrush and Ahrefs can also act as great resource banks for locating your negative keywords.

The Finer Details

Hold on though. You’re not done yet.

Like we already mentioned before, these tactics are amazing for giving your Shopping Campaigns a quick boost. However, they hardly cater to your highly individualistic situations. 

This is why you need to analyze your Shopping Campaigns.

When analyzing your Shopping Ads, your KPIs lie at the heart of it all. Without a thorough idea of these 3 essential KPIs and how they affect your Shopping Campaigns, you are going to end up feeling very lost in the long run…

1. Return On Ad Spend (ROAS)

Your shopping ad campaign’s ROAS is the most crucial KPI that determines everything.

Simply put, it is a measure of how much returns you are making on your ad spend— how much you are spending versus how much you are getting back.

Calculating your ROAS is fairly simple— just divide your total conversion value by ad spend and you are good to go. 

The tricky part is to ensure that your campaigns are maintaining a good ROAS at all times.

It is a general rule of thumb that a good ROAS for your shopping ads is about 4:1 while anything below 2:1 is considered unsatisfactory. 

However, do note that this ENTIRELY depends on your business and its profit margins.

If your Break-Even ROAS is a 1.5, a ROAS of 1.9 from Shopping Ads would be more than profitable for your eCommerce business.

If you are looking to improve your ROAS, lowering your bids or improving the product pages themselves could go a long way in making a difference.

2. Click-Through-Rate (CTR)

Anyone who has been involved in the world of digital marketing for any amount of time will know what CTR is all about— it is the number of clicks your ads get divided by your total impressions.

Your shopping ad’s CTR is an important metric because it shows how many people from your target audience were tempted to click on your ad after coming across it. 

A poor CTR means that your ad is failing to appeal to your ideal customer.

But this is not it— there’s a bigger reason why your CTR matters.

A major reason why a higher CTR is beneficial for your Shopping Campaign is because it improves your campaign’s Quality Score.

Your quality score is a metric used by Google to compare your ad quality with your competitors. 

Google states that there are components that affect your quality score— expected CTR, ad relevance, and landing page experience.

The following image does a good job breaking down the extent to which these three factors affect your Quality Score. 

(As you will notice, your expected CTR is one of the most important factors.)

Quality Score is measured by Google on a scale of 1 to 10 where 1 is the lowest and 10 is the highest. In case you notice a “—” in your Quality Score column, it means that Google has not collected sufficient data to determine your Quality Score.

Now that you know what Quality Score is all about, you must be wondering why it matters…

The biggest reason why you should focus on your expected CTR, and in extension your Quality Score, is because it significantly impacts your Cost-Per-Conversion.

Your Cost-Per-Conversion is the amount of money you spend for each conversion you achieve. 

Make sure not to confuse it with your Cost-Per-Click, which is the money you pay for each click you get, regardless of whether that click converts or not.

While these two terms are not the same, they are interrelated. A lower CPC would mean lesser money spent per conversion. In other words— a lower Cost-Per-Conversion.

Google rewards better quality ads by charging less money for the clicks they receive. If your ads have a high Quality Score, it would subsequently lower your CPC, and hence your Cost-Per-Conversion.

But what is an ideal CTR?

The average CTR for Google Shopping Ads is 0.88%, however, depending on your industry, this could also be a terrible rate. Ideally, you should be aiming for a CTR that exceeds 1%. 

You can refer to this chart to see where your ideal CTR should stand:

If you feel that your CTR is not up to the mark, optimizing your ads could be your best bet. 

This could mean anything from writing a more descriptive title to updating your product image, to even lowering your prices.

3. Average CPC

While there are many more KPIs to look at, the last major KPI you need to take care of is your average CPC.

Your CPC, or Cost-Per-Click, is the amount of money you are spending on each click you get. 

Suppose that you got two clicks on your ads, one worth $ 0.70 and the other worth $ 0.40. This would put your average CPC at $ [(0.70 + 0.40]/2 = $0.55.

Keeping an eye out for your average CPC is essential to make sure that your costs do not add up too much. 

The average CPC across all industries is $0.66 for Google Shopping Ads though this varies based on your industry. It would be best to try keeping your average CPC in the $0.50 range for best results.

If you think your average CPC is going too high, the best way to fix it would be to lower your bid or improve your Quality Score.

The Bottom Line

At the end of the day, the bottom line with Google Shopping Ads is that you should always be on the lookout for spending less to earn more and possess an open mind towards learning through implementation.

While this is one of the most comprehensive guides out there to understand how you should analyze and optimize your Shopping Ads, there is simply no end to the various tactics and strategies you can apply to make Shopping Ads successful.

Lastly, time is key when analyzing and optimizing Shopping Ads since it gives valuable insight into how your ads are performing so far and what is the general data related to them. 

Just be patient with your Shopping Campaigns and you should be good to go very soon!

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