Google’s Smart Shopping best practices often include splitting out your products into multiple Smart Shopping campaigns; but is that always the best practice and if so, why?
To understand the logic behind Google’s recommendation to split your products into multiple campaigns you have to look at the goal of your online advertising. Consider if your goal is to maximise the revenue from your ad spend, generate awareness, sell new or unwanted stock or hit a particular return on your ad spend. These different goals will determine whether or not it’s best to have multiple Smart Shopping campaigns. For more information read our blog on setting your online advertising goal
Maximise Revenue
If you want to optimize towards the most revenue from your ad spend; the best thing you can do is keep all products together in the same campaign. The idea here is that you let machine learning maximise your conversion value, or reach your ROAS target, based on the products and categories that are selling well. In an ideal world all products would sell equally but that’s just not the case. Google will show your product ads to people based on what Machine Learning determines will convert and generate the most revenue possible. You may know which of your products sell well but making that decision with 70 million data points from Machine Learning can only be beneficial.
Grouping all products together and setting an overall ROAS target means that if some products are performing well and overachieving your target, you can advertise products that aren’t individually achieving your target whilst still meeting your goal.
Products Not Being Shown
In an attempt to generate the most revenue for your ad spend you may find some products are not being delivered in your Smart Shopping Ads when all products are grouped together. This is likely because those products aren’t meeting your target or your ad spend is too small. There are 3 options available to you:
- Lower your ROAS target: It may be that your products aren’t being shown because the ROAS target you’ve set on your campaign is too high. If you can lower your target whilst still remaining profitable, do so; products that previously fell below the threshold may now start showing. This might encourage more sales at a lower return on ad spend, increasing overall revenue as a result. For more information on why lowering your ROAS target can be beneficial, read our blog on setting an online advertising goal.
- Increase your budget: If you find that you’re hitting your goal and some products are still not showing, it may be that you don’t have the requisite budget. If you’re achieving your goal, keep increasing your ad spend and other product ads may be shown whilst still achieving your target.
- Accept that those products will not reach the returns you need from your ad spend: Some products just won’t sell online at a profitable return. Whether there is high competition or your product price is too high it might be for the best that those product ads aren’t showing so that you can maximise your revenue by spending your budget elsewhere.
Exceptions: Non Revenue Goals
Although grouping all products together is the best strategy for maximising revenue, there are situations in which this may not be your goal.
Optimize To Profit Margins
It may be the case that some of your products aren’t compatible with your overall required return on ad spend because of their margin. If you’re aiming for a 5:1 across your account and some products aren’t profitable unless you get a 7:1, you may not want to have a 5:1 goal on those products. Remember though that just because you aim for a 5:1 doesn’t mean those products won’t exceed your required 7:1. But, if you find that a lot of your ad spend is going to those products and not meeting your 7:1 target, it may be time to exclude that category from your Smart Shopping campaign. Simply set up another Smart Shopping Campaign, exclude the other categories and set the return that you need as the target. You can then repeat this for other categories if necessary.
Once again though, this may not generate the most revenue possible from your ad spend but it will stop you paying for unprofitable ads. This can also be quite difficult to manage and maintain so we would only recommend advanced users to apply this strategy.
Sell Old Stock, New Releases Or A Particular Category
Another situation in which you might want to split out your Smart Shopping campaigns is when you need to sell particular stock. Be it new products or a focus category, the only tangible way to ensure you are advertising those products is by putting them in a separate Smart Shopping campaign. This may require a lower ROAS target than your other campaigns if you’re trying to encourage more traffic and awareness of a particular category. If you are happy to accept a reduction in revenue to sell specific products this is the strategy for you.
When To Split: The Final Word
So if you have a revenue goal or a return target, you’re better off leaving all of your products in a single campaign. If you have multiple goals that aren’t necessarily revenue focused, splitting your products into multiple campaigns can allow you to set different goals.
For more information on how we can help achieve your Google Smart Shopping Ads goals read about our Google Shopping Management plans.
We also have some e-commerce platform specific services.
