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We’re six weeks or so into the migration of retailers’ product listings on Google to the new Google Shopping.

Retailers now have to pay for Product Listing Ads (PLAs) to appear in Google’s Shopping section (they appear either on the right hand side of the page, or just below the ads, above the natural results).

As before, these ads are linked to the retailer’s product feed on its website.

Google got some stick in the US (particularly from Bing, which has run an ad campaign and created a website with the line ‘don’t get scroogled’) when it completed the move to a purely commercial model last year, ahead of a roll out to the UK which started in mid-February.

But while (of course) it’ll cost brands more, there are some advantages both to advertisers and to consumers.

One of the most annoying things about the old Google Shopping listings were the number of product listings that were out of date: items either out of stock or not available at the advertised price / size / colour / style.

It made for a pretty awful user experience. But under the new rules, if you’ve bothered to bid on a Product Listing, you’re probably going to make sure that your feed is up to date. Which is good news for users, and as a result, they’re starting to perform well.

Here’s an example of what product ads look like now (note the ‘sponsored’ mark in the top right of the Shopping section): 

Google

The listings are much cleaner and easier to navigate than before.

Interestingly, Amazon US refused initially to pay for PLAs on Google Shopping (it did still pay for text ads in AdWords on specific product searches). But then at the beginning of this year, users spotted that ads for Kindle were appearing in Google Shopping.

Certainly in the UK, Amazon appears in the Shopping search results (see the picture, above).

The quality of the PLAs are improving significantly under the new system, which in turn improves their results. Google is getting much tougher on advertisers to make sure that the Global Trade Item Numbers (GTINs) or Manufacture Part Numbers (MPNs) are properly used to identify products, which means cleaner results pages.

Fairly obviously, advertisers still have to show relevance – you can’t bid on an unrelated product with the Shopping listings.

As we thought there would be, there are a couple of incentives for advertisers to get started on the new PLAs ahead of the final switchover date in June. The first is a £75 credit for AdWords if you spend £25 on Product Listings Ads. The second is a monthly credit of 10% of Product Listing Ad spend up to 30 June.

But the real reason for advertisers to use or not use PLAs is in their performance. We’ve run tests for a number of retail clients and while click-through rates are slightly lower than regular AdWords, the cost-per-click is lower, and – most importantly – conversion rates are higher.

It needs a bit of a shift in thinking from advertisers. PLAs don’t stop search ads from working, or require you to move your AdWords budget entirely to Shopping. It’s just part of PPC now. And if conversion rates improve as a result, any additional the investment will be worth it.

Alistair Dent

Published 5 April, 2013 by Alistair Dent

Alistair Dent is Head of PPC at Periscopix at Periscopix and a contributor to Econsultancy. You can connect with Alistair via LinkedIn, or follow him on Twitter and Google+.

5 more posts from this author

Comments (2)

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Mark

Hi Alistair.
Interesting article. How do you exactly claim the £75 credit for AdWords if you spend £25 on Product Listings Ads?
Thanks!

over 3 years ago

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PRABHAT SHAH, Digital Marketing Manager at Concord Extra

I agree "the cost-per-click is lower, and – most importantly – conversion rates are higher"

I have found similar result in real life.

over 3 years ago

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