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Read This About How To Optimize Google Smart Shopping Campaigns

Can we trust Google A.I. to get the best possible results? We decided to put Smart Shopping to the test.
By Samir ElKamouny
google smart shopping campaigns

Generally speaking, we’re against automation on Google Ads (formerly Google AdWords).

We aren’t big fans of auto bidding, broad match, ad rotation, smart campaigns, maximize conversions, pretty much any of Google’s “recommendations,” and don’t even get us started on Adwords Express.

To be clear, an algorithm didn’t steal our lunch money in high school. We don’t have a personal beef with automation. When Google announced Smart Shopping in May 2018, the Fetch & Funnel team was excited.

We want to improve results and demonstrate success. It would honestly make our lives easier. Anything we can do to improve campaign performance is welcome with open arms.

However, we always test Google’s new auto/enhanced/A.I.-driven features and outcomes generally fall short of expectation. We’re almost always able to produce superior results with manual optimization. Manual bidding, single keyword ad groups, bid stacking (and the list goes on) all generally perform better than their automated counterparts. To Google’s credit, it takes them about a year to iron out the kinks and improve the product post-launch.

But we still hold out hope for every new feature Google rolls out. They have some of the most advanced machine learning and A.I. capabilities in the world. Have you seen the future of Google Assistant? Hey Google, order my favorite Thai food! With that in mind, it doesn’t seem too far-fetched to think that Smart Shopping campaigns could be the new exception to our anti-automation rule.

So, without further ado, here’s an honest review from the team at Fetch & Funnel.

What is Google Smart Shopping? How Does It Work?

Google’s Smart Shopping campaigns are automated shopping campaigns that optimize toward goals. Shopping campaigns automatically optimize ad delivery across Google’s ad networks to achieve the advertiser’s defined goal value, such as conversions or return on ad spend (ROAS).

Bids and placements are also automatically adjusted based on the determined likelihood that an ad click will result in the advertiser’s stated goal. It’s sort of like optimizing for conversions on Facebook.

Smart Shopping ads run on multiple networks, not only Search. Placements will be shown on Display, Shopping, YouTube and Gmail networks. Unfortunately, you can’t break network placements out for reporting purposes, nor can you decide to exclude any particular network. That’s a big downside—but we’ll get to that in a bit.

Smart Shopping Campaigns: Pitfalls

Although Shopping Campaigns sound foolproof in theory, there are plenty of limitations you should be aware of.

    • Negative Keywords : Negative keywords are not available in Smart Shopping. They’re extremely important with traditional Shopping campaigns, and losing control here should make you uneasy. You could will end up wasting valuable budget on completely irrelevant search traffic.
    • Network Placements: Ad performance always varies across different networks. Ads on the Display network generally have lower CTRs and lower conversion rates, while ads on Gmail and Search usually perform better at optimizing for conversions. Not having the option to exclude undesirable networks means you’ll have to pay for clicks that won’t bring you qualified traffic.
    • Location Targeting : You can set the country, but you can’t target a specific region or exclude a city.
    • Ad Scheduling : Google will figure out the best times and days to spend your budget. This means ad scheduling is not an option. If performance stinks between 2 a.m. and 5 a.m. you’re leaving it up to Google to stop showing your ads.
    • Device Targeting: You can’t choose which devices to show your ads. If your target audience mainly uses mobile, you’ll have to pay to run ads on laptops and tablets too.
    • Bid Adjustments: Bid adjustments can go a long way toward optimizing campaign performance and getting the most out of your budget. Unfortunately, bid adjustments are not an option with Smart Shopping.
    • Audience Targeting : Target audiences will be selected for you. Google will determine where to find your best customers, at the lowest cost.
    • Granular Reporting: This is a big one! You won’t be able to analyze data from ads on Display, Shopping, YouTube and Gmail to see where your sales are coming from.

One thing is certain, when activating Smart Shopping you will lose control, and place your faith in the hands of Google’s A.I.

Smart Shopping: Advantages

Despite the drawbacks above, there are some compelling reasons to use Smart Shopping. They’re incredibly easy to set up and can save you a lot of time. If you’re able to set up a Shopping Feed, Smart Shopping is the easiest way to get started in Google’s ecosystem for any eCommerce brand.

Whereas traditional shopping campaigns can be overly complex. Breaking out your product catalog, grouping and structuring your campaigns, bidding, location targeting, exclusions, negative keywords (immensely important). This is highly complex advertising that can quickly overwhelm even the most seasoned PPC manager.

Smart Shopping: Best Practices

As with all Google innovations, you’ll have to test and apply best practices to see how does google shopping work.

    • Start small. Start with a specific product group and leave the others running in normal Shopping campaigns. In fact, Smart campaigns have priority over existing campaigns for the same products, so they will disrupt normal ad activity and performance.
    • Test it out. Run your test for a minimum of 15 days and evaluate performance afterward. If everything looks good, begin adding other product groups until you’ve transferred the full product catalog over to Smart Shopping.
    • Don’t double up. If you plan to include your full product catalog within a Smart Shopping campaign, Google recommends pausing existing Shopping and Dynamic Remarketing campaigns in order to avoid over-serving and wasted budget.
    • Choose your strategy wisely. It’s important to understand the difference between bidding strategies before selecting the one you’ll use. The difference between Target ROAS and Maximize Conversion Value can have a significant impact on campaign performance. Maximize Conversion Value tends to maximize ROI within a given budget, whereas Target ROAS sticks to the target you set.
    • Segment your products. Problems may arise when you have a large catalog with many different products. Some products might have strong competition resulting in higher CPCs, which in turn generates a lower ROI without an increase in sales. Other products might have lower CPCs or higher price points and return a better ROI if sales volumes remain constant. Therefore, if you want to use a Target ROAS strategy, we recommend segmenting products into separate campaigns in order to assign individual ROAS values. You should segment your products into several product groups, even within the same campaign, and even when targeting the whole catalog.
    • Analyze performance and adjust your strategy. Segmenting your products enables you to get granular reports to properly gauge campaign performance across each product group. You might discover that certain products are better off remaining in separate campaigns in order to better control budgets.

How to Set up Smart Shopping in Shopify

Google is also teaming up with third-party e-commerce platforms to make it even easier to get started with advertising. If you’re on Shopify, you can set up Smart Shopping from within the Shopify platform. It’s really easy to set up and you don’t need to start with a large budget. You can sync your products, run a Smart Shopping campaign, and track results — all from Shopify.

To set it up, first head over to the Shopify App Store and install the official Google Shopping plugin.

Then configure your Google Shopping Settings and be sure to connect your Google Ads account and go through the Google Ads checklist. Don’t forget to set up billing from within your advertising account as well!

Then you’re ready to click “Create Campaign”:

Next up, set your daily Campaign Budget and hit “Save”:

Create Shopping Campaign

And now you’re all set!

Conclusion: Is Smart Shopping Right for Your Business?

When it comes to performance data, our results are a mixed bag. We’re continually testing new Smart Shopping campaigns across a wide variety of industries, but at present the ability to generate significantly improved results just isn’t there.

We experienced pros and cons, but overall results weren’t all that impressive. Sometimes performance declined, and other times we saw healthy improvements in comparison to existing Shopping and Dynamic Remarketing campaigns. Smart Shopping went live in May 2018, and although it’s been about a year since they launched performance doesn’t seem to be improving. At this point it doesn’t look like they will be able to consistently outperform regular Shopping campaigns, and unless automation is your only option we recommend not using Smart Shopping.

Keep in mind traditional Shopping campaigns are often the most profitable area on Google for e-commerce businesses, and strong performance comes from having meticulous control over the right levers. Without this level of control, you’re flying blind and results will suffer. You’ll lose sales to your competitors.

However, if you’re not an advanced advertiser and don’t have a whole lot of experience running campaigns, Smart Shopping could be your best option, it can’t hurt to test. Trial-and-error is a necessary evil. Or, at least a necessary headache. Sometimes just showing up is enough to get the job done until you’re ready to step it up.

If you’re looking for an easy way to run Google Shopping, we recommend trying your hand at Smart Shopping campaigns. If, on the other hand, you find the above daunting, or you want to actually scale your business and dominate your competitors on Google, give us a call and we’ll do it for you!

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