If you're an AdWords vet, you're probably familiar with the âaverage positionâ metric that Google provides . It help
3 METRICS
TO OUTRANK THE COMPETITION IN GOOGLE SHOPPING
TABLE OF CONTENTS
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Introduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 The Three Metrics Benchmark Maximum Cost Per Click. . . . . . . . . . . . . . . . . . . . . . . 4 Benchmark Click Through Rate. . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Impression Share. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Making Metrics Work Together. . . . . . . . . . . . . . . . . . . . . . 10 Putting It All Together. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
AH, THE LAND OF THE DATA-DRIVEN MARKETER Nowhere can the landscape feel more disorienting than the Google Shopping dashboard. Depending on your product grouping strategy and the size of your product feed, you might have five, 50, or 500 product groups. And with dozens of different metrics available to add to your reporting columns, you’ll have…well…a whole heck of a lot of data to try to sift through. In 2014, Google added to the barrage by giving marketers using the Google Shopping Channel new competitive metrics. When it comes to competitive intelligence, though, there are three key metrics you can use to understand where you’re at and, just as importantly, where your competitors are. Let’s break them down, shall we?
1. BENCHMARK MAXIMUM COST PER CLICK
This metric helps you understand how you’re stacking up against your competitors when it comes to what you’re bidding for similar products.
2. BENCHMARK CLICKTHROUGH RATE
Like the Benchmark Max CPC, you can use the Benchmark CTR to understand how your PLAs are performing from a clickthrough rate standpoint when compared against those of your competitors.
3. IMPRESSION SHARE
Ever want to know how frequently your products are actually getting in front of a shopper? Now you can. The Impression Share figure is your number of impressions divided by the estimated number of impressions you were eligible to receive.
Inside, we’ll dive into the details behind each of these metrics Sidecar | 3 BACK to Table of Contents
METRIC 1
BENCHMARK MAX COST PER CLICK
Metric 1
BENCHMARK MAX COST PER CLICK As the name might suggest, Benchmark Max CPC lets you benchmark your bid within a product group against your competitors. These are powerful tools, but a few caveats: GOOGLE ONLY DISPLAYS THIS DATA WHEN IT HAS ENOUGH ADVERTISERS PLACING BIDS. Google doesn’t define what “enough” is, but, rest assured, this practice is a good thing for you. It helps eliminate any outliers (like advertisers who are grossly overbidding) and gives you a truer picture of how your competitors are pricing their ads. GOOGLE DISPLAYS THIS DATA AT THE PRODUCT GROUP LEVEL, NOT THE ITEM ID LEVEL. That means you’ll be able to get a general sense of how your competitors are bidding for similar products within your product group, but not for similar products to a specific product. (This is important, so we’ll revisit in detail.) GOOGLE DOESN’T DISPLAY THIS DATA IN REAL-TIME. Sure, that’d be amazing, but Google says it uses a one-totwo-day window to update the benchmark. Though you’re likely not making knee-jerk reactions to real-time data, we think it’s good practice to keep this fact in mind. It’ll help you spot trends and recognize areas of optimization, but it won’t tell you what’s happening in real time. Sidecar | 5 BACK to Table of Contents
Now, about that second caveat: You might be thinking, If Google doesn’t provide me benchmark data at the Item ID level, then this data is only as good as my product grouping strategy. If you’re thinking that, you’re right. Say you’re grouping your products by brand or category (a common practice among retailers and agencies) and you’re attempting to use Benchmark Max CPC to help you understand how you’re bidding within a specific product group against your competitors. Google, no doubt, will present you with a benchmark (provided the first and third caveats, mentioned left, are met), but that benchmark is of little use to you. Here’s why: The products within your grouping perform so wildly differently that you can’t actually make a decision based on that benchmark. Sure, you may be below it and you might think that you should increase your bid to the benchmark level, but some of your products are probably performing incredibly well at the level they’re at. So, why would you bid more for those products and reduce your margins? There are insights to be gleaned from this data, to be sure, but you’re not going to get much unless you’re organizing your product groups by performance.
METRIC 2
BENCHMARK CLICK THROUGH RATE
Metric 2
BENCHMARK CLICK THROUGH RATE
Since Benchmark CTR shows you how other PLAs for similar products are performing from an engagement standpoint, you can begin to diagnose the overall health of your campaign.
The caveats for Benchmark Max CPC still apply here, but Google says that you can use this data as a signal that, maybe, you should improve your product information, like product images and titles, in your Merchant Center account. We think that’s good advice. Don’t, though, jump right in and increase your product group bid to see if you can push your PLA further up the results page and, thus, improve your clickthrough rate. Instead, if you’re finding your product group lagging behind the Benchmark CTR, consider breaking out your poor performing products into a separate group to improve the health of the overall grouping. (This is a good first step toward restructuring your product groups around performance.)
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METRIC 3
IMPRESSION SHARE
Metric 3
IMPRESSION SHARE
If you’re an AdWords vet, you’re probably familiar with the “average position” metric that Google provides. It helps you understand which place in Google’s ad hierarchy your ads are showing. It can be super beneficial when trying to understand why certain ads, ad groups or keywords are performing the way they are. While, there’s no “average position” metric for Google Shopping, there is Impression Share. Impression Share tells you how frequently your products are actually getting in front of a shopper. To calculate the figure, Google takes the number of impressions you received and divides it by the estimated number of impressions you were eligible to receive. Though this metric can give you a severe case of FOMO (Fear of Missing Out), take a breath before you rush to follow Google’s suggestion of upping your bids, and consider whether you’re performing well relative to your competition or whether that bid increase might just help you spend more money without getting more results. You can do this by reviewing your benchmark data for Benchmark CTR and Benchmark Max CPC.
Read on, and we’ll dive into details on how to do just this. Sidecar | 9 BACK to Table of Contents
MAKING METRICS WORK TOGETHER
MAKING METRICS WORK TOGETHER The ways you can use these metrics to optimize your Google Shopping campaigns is limited mostly by your willingness to take a wider view of the data. One of the keys to getting the most out of this data is understanding that you can and should pull it all together to get a better understanding of how your campaign is performing. It might sound a little daunting at first, but you’ll find that escaping a narrow viewpoint will be beneficial. So, to get your brain moving on ways you can score your own account on these metrics, here are two common scenarios we’ve seen and how this data, when combined, can be useful to optimizing your Google Shopping campaign:
If your Max CPC is significantly lower than the Benchmark Max CPC, you could take that knowledge and check it against your Impression Share figure. You might find that, because you’re bidding lower than most competitors, your product listing ads are not actually showing up with the frequency you need to be successful. Correcting that might be easy: Just up your bid. But what about the risk of bidding without regard for performance? Enter Benchmark CTR. WHAT TO DO: Before actually changing your bid, you can measure your clickthrough rate against the Benchmark CTR to determine whether upping your bid to increase your impressions is a wise move. If, say, you’re outperforming your competitors on clickthrough rate, it’s likely that your advantage in this product group can be extended by upping your Max CPC. By understanding more about each of these metrics, you’ll be able to think outside narrow confines and see how each metric works with the other to shed new light on the performance of your product groups.
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Say you have a high Impression Share, and when compared to your competitors, a high click-through rate for a specific product group. That might sound like a good situation, a closer view of the combined metrics might tell a different story. Let’s say the Benchmark Max CPC as well as your Average CPC is $1, but you’ve set a Max CPC of $5 (still with me?). It’s likely that your Max CPC is set too high which can lead to wasted or inefficient ad spend. How? Consider if a new competitor comes into the market with a $4 bid. Because your Max CPC is set at $5, which, aggregate data suggests is unnecessarily high given the large gap between your Max CPC and what you’re actually spending, your Average CPC in that group will shoot up per your Max CPC. It might be worth it to increase your bid that high, but it might not. Either way, with an overpriced Max CPC, you lose some level of control over your account, and you might not realize it until you see your spend spike. WHAT TO DO: Adjust your bid so that it is closer to, but still above, the benchmark Max CPC. You maintain your strong Impression Share and CTR for this product group, while likely avoiding any damage that could be done by a runaway bid.
PUTTING IT ALL TOGETHER
By combining these metrics, you’re likely to determine that you can optimize your campaigns in a number of different ways. You could scale back some of your bids and still realize the same performance, or increase others to drive additional revenue and boost the likelihood of putting your PLAs in front of the right consumer at the right time. The catch, of course, is making sure you’re organizing your campaigns correctly. We can’t overstate the importance of prioritizing performance over other attributes, like brand or category. If you’ve got that down, your next question is probably: how do I know if I’m winning against my competitors? It’s a question retailers have been asking themselves for a long time. Now, thanks to these metrics, it’s a lot easier to answer for the marketers who know where to look. –Dave Nossavage, Senior Analyst at Sidecar
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