Bigger now than Paid Search ads: Google Shopping

Retailers are now spending more of their AdWords budget on Google Shopping campaigns than on paid search text ads.

In 2016, 53% of ecommerce retailers’ AdWords budgets went to Shopping ads; 47% to text ads.

The turnaround in Google Shopping’s fortunes dates back to Q2 last year, coinciding with a mobile-first redesign that placed shopping ads (Product Listing Ads, or PLAs) above text ads.

With strong growth in both the volume and performance of shoppers using mobile devices, share of spend for mobile has gone from 23% in 2015 to 34% last year. Where mobile produced 17% of Google Shopping revenues in 2015, its contribution grew to 29% last year, with corresponding improvements in conversion rates and Return on Ad Spend (ROAS).

The data comes courtesy of marketing company Sidecar’s analysis of 19.1 billion user sessions on retailers’ ecommerce sites, and is reported in its “2017 Google Shopping Benchmarks Report”.

Sidecar looked at a range of verticals: mass merchant, apparel, automotive, books/music/video, food and drug, pet care, jewellery, grocery, electronics, health and beauty, house and home, sporting goods, office supplies, and outdoors.

Why should you care?

Google Shopping is not available in New Zealand, but Product Listing Ads are.

The distinction is a subtle one that has tripped us up before now (for the record, Shopping has its own dedicated tab on the search result pages).

Regardless, the message for ecommerce retailers is the same. Now’s the time, if you’ve not yet taken the plunge, to open a merchant account, set up a product feed, and test some Shopping campaigns.

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