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THE FINCH BLOG

The older, free Google Shopping ads is being replaced by new Product Listing Ads. While Google Shopping was a free listing service, PLAs are a paid service; however, now PLAs get premium placement on the search results page. PLAs complement text ads, but don’t replace them.

Here is an example of how they work together on a search page:

As an online retailer, in order to offer PLAs, you export your products from your database to the Google Merchant Center and then link your Google Merchant Center with your Google AdWords account. Google will auto-create an AdWords campaign with all of the products that are included in your feed. You are then prompted to enter how much you are willing to pay per click for the PLAs. This works great and is a highly effective way of gaining more exposure to your inventory. As in the illustration above, your product may be displayed for organic search results, text ads, and Product Listing Ads. The more real estate you own on the page, the greater the chance of getting the click!

Finch’s PLA enhancement

The products in your Google Merchant Center feed have different prices and different profit margins. Each of the product listings will also have a different conversion rate. Because of this, the amount you are willing to bid per click should vary greatly. Consider these two examples:

  Product A Product B
Price: $125 $250
Conversion Rate: 1% 2%
Margin: 20% 20%

Wouldn’t you be willing to pay more per click for Product B? Of course you would. The problem is that the conversion rate keeps changing, buyers are entering additional products into their shopping carts making the revenues vary as well, and competitors are constantly changing what they bid. When competitors make changes to their ads (CTR), etc., it makes for a complex environment with performance data constantly on the move.

Finch structures your PLA campaign where each product is tracked for cost, conversion rate, and revenue (and/or profit). Every day Finch will update how much you are willing to pay for a click for each PLA based on cost and revenue history. This is easy to explain for PLAs that have high sales volume, but it gets trickier when you have PLAs with limited or no sales.

Through technology and automation, Finch is able to keep your overall cost target in-check while optimizing the overall revenues (or profits) from your campaign. Being able to set the bids based on your revenues is a game changer for most clients since you get to be as aggressive as your margin allows, while competing based on what works for you.

Free Case Study

Download a free case study about Kitchenware Direct - Australia’s premier online cookware and kitchenware store based in Perth, Australia - who used Product Listing Ads to increase their sales by 9%.