Google Smart Shopping Campaign Best Practices & Optimization Guide

Google ads have been seeing a shift of landscape from behavior-based targeting to data-driven targeting. Earlier, most of the targeting parameters revolved around targeting such as manual CPC, ECPC, etc. However, with time, Google Ads started leveraging the data-driven decisions in its bidding strategy.

So, new strategies were introduced on the platform such as maximize clicks, maximize conversions, TCPA, etc. Once these bidding strategies were tested with enough data across Google ads, the new campaign types were introduced on the platform which was almost semi-automated such as DSA, smart campaigns, etc. Many marketers have leveraged these campaigns and it’s time that you should also leverage them.

Smart Shopping Campaigns

Smart shopping campaigns are basically a hybrid of standard shopping campaigns and dynamic remarketing campaigns (display) with automatic bidding and larger reach. From the shopping campaign point of view, the bidding is automated and from the display campaign point of view, the reach has become broader. Earlier, the shopping campaign would run only on the search network but now, it reaches across display network as well.

Smart Shopping Campaigns Requirements

There are a few basic requirements of the smart shopping campaigns. I will cover the advance level later in this article.

  • The smart campaign should have transaction-specific conversion tracking. In a nutshell, when a conversion happens on your website, the sales value should also be passed to the conversion tracking pixel. You can read about it here. You need to dynamically pass to the event snippet the value of the conversion and its currency by setting the value and currency parameters highlighted below, at runtime.

Example of transaction specific conversion code

  • You need to have Global Site Tag along with a remarketing list of at least 100 active users. So, let us start with the Smart shopping campaign optimization Guide

Smart Shopping Campaigns Optimization Guide

Dynamic Remarketing Tag Set Up

When you set up the dynamic remarketing tag on your ECommerce website, make sure that you are passing as many as possible parameter values to the platform. Here is a very nice blog on setting up Dynamic remarketing via GTM. The more granular information you pass, the better the performance would be. So, why dynamic remarketing is so important?

Audience source in Google ads

In the picture above, you can see that the tag hits stopped being delivered towards the end of September. And how did that impact the performance of the smart shopping campaign?

Conversion Graph

In the above picture, you can see that the conversion took a dive towards the end of September because of certain Ecommerce parameters not being fired. If you do not set up custom parameters, machine learning will be used to match products from your feed based on insights provided by your Google Analytics or global site tag, such as your page titles and landing pages.

Remarketing Lists & Smart Shopping Campaign optimization

If you have not realized until now, then you should know that the optimization capacity of a smart shopping campaign depends on the strength of the remarketing list build. The more data Google ads platform has, the better it will optimize the smart shopping campaign. Have a deeper look at the remarketing list from the Google Ads platform below:

Automatically created google remarketing list

Google ads have automatically created a few remarketing lists from the Google ads remarketing tag. These audience lists work as a sample list using which the smart shopping campaign algorithm optimizes the campaign performance. If you even further notice in the list above, the remarketing lists are built upon:

  • Converters
  • Past buyers/ Converters again
  • General Visitors
  • Product page visitors
  • Cart abandoners etc.

And all of these pieces of information are passed to the platform using the dynamic remarketing tag. That’s why I addressed the importance of dynamic remarketing tag implementation at the beginning.

Smart Shopping Budget Optimization

Smart shopping literally combines the ad spend of shopping and display campaigns. So, if you are planning to start a smart shopping campaign, combine the average daily spend of shopping and display campaigns over the past 30 days and allocate that budget to smart shopping ads.

You should also pause the dynamic remarketing as well as standard shopping campaigns as a smart shopping campaign takes priority over these two later campaign types. In the screenshot below, we had to pause the standard shopping campaign as it stopped spending since the smart shopping campaign kicked off and took over the priority over the standard shopping campaign. Also, if both of the campaigns are running in parallel then, there is an interference in the campaign learning for smart shopping campaigns.

Smart campaign affects standard campaign

Smart Shopping Campaign Products Guide

I have seen many people starting with a limited budget and a limited number of products when starting with a smart shopping campaign. That’s not the best practice. The idea here is to make your campaign learn as fast as possible and as reliable as possible. Also, to have comparable or better performance to standard shopping or dynamic remarketing campaign, it is recommended to have at least the same selection of products.

If you did not run any such campaigns in the past then, it is still advisable to have a large set of products so that the campaign has more choices and better decisions to make and are not restricted by a few products.

Product Segregation

However, product segregation is also important. Once you give a budget, the Smart Shopping campaigns automatically maximize your conversion value within a given budget. It often results in the machine learning algorithm recognizing the top bestsellers while other products get left out.

In case, you have certain mandatory business requirements that would not allow you to consolidate the products, then create separate campaigns for such product lines. Some examples of such campaigns could be

  • Different ROAS goal for different product lines
  • Clearance sale
  • seasonality etc

Learning period

You should give some time to the campaign in order for it to learn. Typically, it starts performing within a week but Google recommends it to be a minimum of two weeks. However, you should also keep a tab on external factors as well such as seasonality, weekends, events, offers, holidays, etc.

Don’t panic

As the campaign learns, the performance in terms of CPC or number of clicks might fluctuate. For example, initially, there might not be enough clicks on the campaign. That’s because the campaign strives to optimize for conversion value than clicks. So, it tries to eliminate the non-converting clicks and bid higher on converting clicks with the saved money.

Make a Decision

Some campaigns might perform and some might not. It is hard to tell when to kill the campaign. In my opinion and experience, it is better to kill the campaign when you have stability in the data. For example, there is not much fluctuation in the following context:

  • Average CPC has become stable in the past few days
  • Number of clicks from the campaign is getting stable

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