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Google's PLA Ads: Bid Price vs. Product Price vs. Image

  |  December 7, 2012   |  Comments

Evaluating the impact that changes in image or product price might have on the success of the ad.

You probably aren't maximizing your holiday PLA cheer. 'Tis the season for Google to give away (for a fee) large sections of the SERP to retailers running product listing ads (PLA), but many merchant advertisers are missing out on the opportunity because they don't understand the evolving best practices in this new hybrid-bidded feed marketplace. One common failure by marketers is not understanding how product image and product price drive changes in user behavior and therefore changes in Google's PLA Quality Score. Instead, many advertisers are over-focused on bids (CPCs) instead of the holistic ad.

Images deliver far more information to the consumer than text does and the human brain is drawn to images, which is why Google rolled out PLAs into the new ad format that often takes up one-third of the SERP, driving significantly more ad clicks per search for Google. It's too early to know exactly what percentage of clicks are being cannibalized from the paid AdWords vs. ad clicks that wouldn't have occurred at all or are being sucked from the organic listings over to the PLA ad block.

Let's explore the various scenarios in which Google chooses to serve up a PLA section within its own SERP as well as the scenarios where PLA ads and ad elements are used within the shopping tab. Then we will evaluate the impact that changes in image or product price might have on the success of the ad.

I've included the three PLA ad layouts in the image accompanying this column.

pla-ads

Product-specific ad: when Google is sure what product the searcher wants. It's used extensively in the electronics category where the image of the product doesn't add much additional value to the search and nearly all retailers are using the same stock image. In this case, price of the product can make or break your campaign. Notice in the example or in a search of your own that it's immediately apparent which of the retailers has the lowest price, regardless of the position of the merchant listing in the ad. In most other PLA results, Google shows a diversity of images and prices are not as apparent and exciting in comparison to the image.

The generic 8-Pack of PLA results happens in the right rail where it takes over the space previously occupied by three or four text ads. So, while you may not see CTRs on your ads in the double-digit percentages, overall Google is getting a lot of searchers to click on those ads. If you want your ad to be the one that pops, the image may matter as much as price and perhaps even more than bid price, because Quality Score is an important part of achieving enough ad rank to get placed in the 8-Pack.

Once you've made it into the 8-Pack through a good image, price, and bid combination, you certainly want to further improve your CTR with images first, because an improved image is likely to improve your CTR and lower your required bid without significantly reducing (and perhaps improving) conversion rate. For product-level searches, remember to include all variations, styles, colors, etc. Google now pulls from a wider variety of assets when it matches images/products to searches, so it's important to include it all in your feeds. For example, if everyone else is coming up for black versions of sneaker XYZ and you show an image of blue ones, it will allow you to stand out.

Price may still be a significant enough determinant of CTR that you may want to experiment with price changes. Not every retailer has the time or ability to monitor competitive pricing in real time and you also need to consider the fact that a price change on the site manifests itself in a change in profit for all orders, not just those coming in from Google PLA ads. In the main SERP, Google doesn't calculate an all-in price for customers (including tax and shipping) the way it does in the shopping tab results, so this opens the door to shipping policy shenanigans that might allow you or your competition to adjust free shipping thresholds to get back any margin you lost by reducing price.

The generic 5-Pack is a similar format to the 8-Pack but the 5-Pack is displayed below the traditional PPC AdWords ads and above the organic listings. It's easy to see why for many users getting this result means that organic listings are nearly invisible in comparison to all the paid options.

In addition, within the Google shopping tab Google will sometimes use image analysis to suggest similar items, making your image use in the PLAs even more important. Consider: who do you want to be compared with within the Google shopping tab?

Image search alone and the increasing usage of Pinterest also should inform your image strategy. For apparel, consider product shots both with and without a model. Even non-apparel items may work best in the hands of a model.

As with all optimization tasks, start with the highest opportunity products and experiment with those first, because a win there will move the needle and get you promoted faster. If you need help, talk to peers or agencies that understand both feeds and the PPC environment. It may be well worth bringing in professional help to tackle optimization in this environment, where many variables are in play at the same time.

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ABOUT THE AUTHOR

Kevin Lee

Kevin Lee, Didit cofounder and executive chairman, has been an acknowledged search engine marketing expert since 1995. His years of SEM expertise provide the foundation for Didit's proprietary Maestro search campaign technology. The company's unparalleled results, custom strategies, and client growth have earned it recognition not only among marketers but also as part of the 2007 Inc 500 (No. 137) as well as three-time Deloitte's Fast 500 placement. Kevin's latest book, "Search Engine Advertising" has been widely praised.

Industry leadership includes being a founding board member of SEMPO and its first elected chairman. "The Wall St. Journal," "BusinessWeek," "The New York Times," Bloomberg, CNET, "USA Today," "San Jose Mercury News," and other press quote Kevin regularly. Kevin lectures at leading industry conferences, plus New York, Columbia, Fordham, and Pace universities. Kevin earned his MBA from the Yale School of Management in 1992 and lives in Manhattan with his wife, a New York psychologist and children.

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