If you advertise a product (or multiple products) online - anything with a UPC, EAN, JAN, or ISBN - you should feed your product data directly into Google Merchant Center and sync it with AdWords. NOW!
There are two main reasons why:
- It is better for converting ads.
- And there is now a lower cost per click (for a limited time…).
What are Product Listing Ads?
Product Listing Ads are ads with product images, star ratings, price and the name of the business. These unique ads appear in the search results of Google (and their partner sites) when a commercial item is searched for.
Better and Cheaper? Really?
The numbers don’t lie. Numerous studies on Product Listing Ad performance have yielded all sorts of convincing data. Just last month, The Rimm-Kaufman Group reported that Product Listing Ads account for 23% lower cost per clicks compared to text ads.
Analyzing our own pool of client data from the last 12 months showed Product Listing Ads averaging 37% lower cost per clicks compared to text ads.
Additionally, when comparing performance to Text Ads, we found Product Listing Ads accounted for:
- 85% higher click-through-rates.
- 18% higher conversion rates.
- 62% lower cost per conversion.
Will it last?
When there is commercial search intent and Product Listing Ads are displayed, I expect there will continue to be higher click-through and conversion rates compared to normal text ad formats. Whether the CPC will remain lower is unlikely. A big reason why Product Listing Ads are comparatively cheaper is because there is currently less competition. In other words, at the moment, there are fewer merchants running Product Ads than running text ads for the same or similar search queries.
This isn’t surprising considering Google only recently shifted their business model around product search. The Product Ad format has been around since 2010, but in May of this year Google placed their focus on delivering “a better shopping experience” - essentially combining the old product ad format with Google Shopping results (which were formerly free). This yielded a new, standalone shopping box displayed prominently on results pages.
This new ad real estate and corresponding revenue model will likely help Google better monetize product search. That said we can assume it is in Google’s best interest to continue to feature Product Listing Ads for “shopping” based search queries, and enable merchants to better connect with potential customers. But as this transition ramps up and more merchants begin using these unique ads, competition for placement will rise and so will cost per click.
So get in there! It’s not too late. Try Product Listing Ads while competition is low(er) and the opportunity for greater ROI is high.
And let us know how it goes! I’m interested to hear if anyone has experienced similar results.