The Future of Search for Retail Marketers? Google Shopping Ads
Google Shopping ads have never been so conspicuous to consumers — nor so successful for retailers.
Search for "black sunglasses," and it's hard to miss the Google Shopping ads monopolizing the right rail of the desktop search engine results page (SERP), topping the mobile SERP and leading the image results page across devices.
Retailers now devote the majority of their AdWords budgets to Shopping ads, according to Sidecar's 2017 Google Shopping Benchmarks Report.
Indeed, Google Shopping has brought retailers to an inflection point in their paid search strategies, creating both opportunity and urgency to drive more value from the channel.
Key Google Shopping Trends
2016 was a milestone year for Google Shopping. The 2017 Google Shopping Benchmarks Report found:
1. Shopping ads overtook text ads. In 2016, retailers spent 25 percent more on Google Shopping ads than they did in 2015. Spending on text ads was nearly flat: Retailers spent just 3 percent more on text ads in 2016 than in 2015. On average, retailers spent 53 percent of their AdWords budgets on Shopping ads in 2016.
2. Google Shopping drove more sitewide sales. The channel has become an indispensable tool for retailers. Google Shopping ads were responsible for 16.1 percent of sitewide sales in 2016, a year-over-year jump of 78 percent.
3. Retailers got more comfortable with mobile. Retailers devoted 34 percent of their Google Shopping budgets to mobile ads in 2016. This was up from 23 percent in 2015, a 48 percent year-over-year increase. Consequently, revenue from retailers’ mobile Shopping ads surged 134 percent YoY in 2016 and comprised 29 percent of their total Google Shopping revenue.
It’s clear that Shopping ads are not only a prominent visual fixture of Google’s SERP, but they have become its MVP for e-commerce marketers. This has several implications for any retailer selling online.
Opportunities for Retailers
First, Google Shopping mastery is a must, not a luxury, especially when it comes to mobile. Shopping ads are among the first things consumers see for many mobile searches.
Digital natives are at home browsing mobile Shopping ads’ interactive carousels, transforming the ads from research mechanisms to a source of conversions. Device-optimized Google Shopping strategies are a requirement to ride this wave.
Retailers should also set their sights on user-centered Shopping strategies. Google has added its Customer Match and RLSA features to Shopping, major steps toward building audience targeting offerings that rival Facebook’s.
Reconnecting with valued customers and site visitors on Google’s SERP is a massive opportunity. Retailers must refine how they construct retargeting lists and Shopping audiences, and set precise bids to reach those audiences for the right price.
What’s Next for Google Shopping?
Today’s search landscape is infinitely more complicated than it was when text ads reigned supreme. Google Shopping is a data-intensive channel that relies on a product feed containing thousands of SKUs and Google’s closely held algorithms to deliver impressions and clicks.
These complications will only grow over time. As Google unveils new types of Shopping ads, traditional methods of bidding and measurement will blur. Looking over the horizon, there’s no doubt that Shopping ads will find their way into Google’s burgeoning voice and visual search platforms.
This evolution will present perplexing new challenges. For example, how should marketers value a spoken search in Shopping? Someday soon, they must have an answer.
As retailers cope with the seismic shocks buffeting brick-and-mortar stores, and e-commerce grows even more critical, connecting with consumers on Google will take on greater urgency.
Welcome to the future of retail, where winning at paid search means winning at Google Shopping.
Andre Golsorkhi is the founder and CEO of Sidecar, an e-commerce marketing technology company. Find him on Twitter @AndreOG.
