Google Smart Shopping: The Complete Guide for eCommerce Brands

Since its inception, Google’s Smart Shopping tool hasn’t proven as popular as its standard Shopping campaigns. This is probably because eCommerce advertisers have less control over their content, audience targeting and budget.

Below, we examine the pros and cons of using it as part of your eCommerce marketing strategy. We also provide everything you need to know to start your own Smart Shopping campaign.

 

What is Smart Shopping?

Google Smart Shopping is a PPC advertising option for eCommerce retailers. Like standard Google Shopping campaigns, it uses a store’s inventory feed from the Google Merchant Centre to create visual shopping ads that appear in its SERPs. But, unlike standard shopping campaigns, it completely automates ad bidding and placement.

As well as being promoted in SERPs, your products will also appear in a variety of formats across the Google Display Network, YouTube and Gmail. On the display network, you can even run automatic dynamic remarketing and dynamic prospecting ads.

It’s also worth noting that eCommerce brands with a European presence can use Smart Shopping ads with Comparison Shopping Service partners like Swoop, Kelkoo and Shoptail.

According to Google, advertisers who use its Smart Shopping campaigns benefit from 20% higher conversion values – without increasing their ad spend.

This is because Google Smart Shopping uses machine learning to automatically create campaigns with very little input from advertisers. By analysing how the likes of search queries, location, language, time of day, browser type, operating system, estimated age, gender and remarketing impact on your ad conversions, it learns what ads to show to which users and when. This maximises conversions.

In 2022, Google also introduced new Smart Shopping ad formats for Google Discover, YouTube, local ads and offline retail. Advertisers need to sign up for its ‘Performance Max’ tool to access them, but Google says its trials across the EMEA have increased advertiser’s conversions by an average of 13%. In one case study, furniture retailer Joybird even saw its revenue grow by 95%.

 

How does Smart Shopping work?

Google Smart Shopping campaigns are simple to set up. All you need is a Google Ads account, a Google Merchant account and some creatives for your display ads. (Our guide to Google’s Product Listings Ads provides more information on this part of the process.)

To get started, you simply need to sign into Google Ads and click create a ‘New Campaign’. Then, on the page that appears, you should:

  • Select a campaign goal, such as sales, leads or traffic generation
  • Choose ‘Shopping’ as your campaign type
  • Choose the Merchant Centre product feed you’d like to use
  • Select the country you’d like your ads to appear in
  • Opt for Smart Shopping, rather than standard Shopping ads
  • Set your daily budget
  • Set a target ROAS – this is optional but it can help you reach your business goals. However, if it’s set too high, some of your budget may remain unspent
  • Upload your ad assets, including product images, messages and store information

Once you submit this page, Google will automatically create a campaign for you. As it gathers data about the ad placements and audiences that drive conversions for your brand, it will automatically optimise your campaigns too.

Google suggests waiting at least 15 days before making any changes to your campaign, because its smart algorithm needs some time to build up the data it needs to perform optimally. When you first create or adjust a Smart Shopping campaign, you may even notice that your campaign features a ‘Learning Mode’ tag.

 

What is Smart Bidding?

Google Smart Shopping uses an automated bidding process to place auction bids on your behalf.

Its complex algorithm uses machine learning to track historical conversion data at a user ID and user signal level to predict how likely it is that each ad placement will lead to a conversion. This influences whether or not a bid is put forward and how aggressive this bid will be. The higher the likelihood of conversion, the higher the bid will be set. If you set a target ROAS, this will also be taken into account.

 

What are the downsides of Smart Shopping?

While Smart Shopping campaigns may sound too good to be true, there are a few drawbacks that marketers need to be beware of.

1. Limited insights

Smart Shopping reports display key eCommerce KPIs including clicks, costs and conversions for each category, product type and brand. However, you can’t view audience data, the search terms targeted or any product level data. You can’t even see which ad types or platforms are performing best as this data is lumped together.

This makes it difficult for marketers to uncover helpful insights or cut underperforming content from their campaigns.

2. Limited control

Google Smart Shopping doesn’t allow advertisers to adjust their campaign targeting based on search terms, device, product, demographics, platform or any other criteria. Location targeting is possible, but it is limited to countrywide regions.

It’s not possible to set specific bidding preferences either. You can’t prioritise retargeting or set negative keywords to avoid wasting your budget. Instead, Google will automatically run a wide range of ads to determine what works best. As a result, product ads can potentially appear for inappropriate search terms or feature off-brand messaging.

3. Limited oversight

Advertisers can’t see what all their ads look like or where exactly they appear, which can be a bit unnerving – especially if branding is important to your business. However, the performance of Smart Shopping ads will generally make up for these drawbacks, especially for small retailers and amateur marketers who don’t have the resources to plan their own in-depth campaigns.

 

Smart Shopping alternatives

For established retailers who prefer to have more control over their advertising, here are some Smart Shopping alternatives to consider.

The Amazon Marketing Cloud

For advertisers who want to maintain oversight of their advertising data, the Amazon Marketing Cloud is an innovative alternative.

This cloud-based analytics tool allows advertisers to store and analyse their Amazon advertising data alongside their own internal data. By bringing all your attribution sources together, you can optimise your advertising performance in-house and use the insights gained across multiple channels.

ChannelSight

If Smart Shopping isn’t right for your eCommerce store, you can always combine your traditional Google Shopping campaigns with ChannelSight’s shoppable media solution.

This allows eCommerce marketers to add Where to Buy buttons to their online display ads, social media ads, videos and other digital assets to create trackable and shoppable content. This innovative tool is compatible with a wide range of platforms, including Google Ads, Facebook advertising and all other advertising tools that accept third-party links.

Facebook Shopping Campaigns

Facebook also uses machine learning to optimise conversion rates across its advertising network. However, unlike Google Smart Shopping, it also allows advertisers to set their audience targeting and choose their own messaging. Its algorithm then combines these two factors to determine which ad wins each auction.

Final thoughts

Google Smart Shopping is an easy to manage tool, which generally provides positive outcomes for advertisers. It is particularly beneficial for small retailers and startups who haven’t got the resources required to run their own targeted campaigns. However, if you prefer to have complete oversight of your campaigns, it may be worth checking out some alternative options too.