The current Google product search which is a free listing of indexed products will be replaced by paid ads– so-called product listing ads (PLAs) which will be charged to advertisers on a cost-per-click basis. Whilst there has been much debate over the potential loss of traffic and sales, with particular concerns raised by advertisers, at QUISMA, we see it as an opportunity for product marketing.
To create PLAs you won’t need keywords or ad copy. The ads are delivered automatically if a user’s search query matches a product in the advertiser’s merchant centre feed. Because of this optimising your feed is crucial and online store operators who may not have invested in this previously will now, with the conversion to a paid system, have a lot of catching-up to do. On the flipside however, a well optimised feed can result in a very positive effect on the ads’ conversion probability and allow advertisers to use their budget far more efficiently.
The new PLAs also appear in a more prominent placement- either on top of the page in the top positions, or on the right hand side of the page above the search results, and includes product picture, title, price, and the retailer’s name. This attracts far more attention compared to the previous placement:
Moreover, with the right technology you can measure the “performance per product”, which allows a more targeted and cost-efficient optimisation of the campaign regardless of whether it is a product-related CPC-adaptation, or an automated pausing and reactivating of products.
For the PLA setup we recommend a detailed campaign structure, which needs to be created with suitable filters (e.g. brand and product category). Having a quick look at recently searched for keywords in the search campaigns will also be quite helpful. To be competitive, product prices should also be taken into account.
Advertisers should prioritise the product response as they do on the use of a bid management system, to optimally distribute the bids per product. The customer journey should also be taken into consideration, so the budget for the PLAs can be optimally distributed, based on the collected data.
With the PLAs, the SEA-management is complemented by another sub-discipline, which will change the existing practices. From now on, the CPCs of the PLAs, just like for classic search campaigns, need to be regularly checked and optimised in order to meet the CPO and ROI goals in this category as well. Therefore, the SEA manager needs to be fully integrated into the new product search.
Initially you should consider advertising products via PLAs as a supplement to product-related search campaigns (classic AdWords ads). We recommend editing product feeds via a feed manager for dynamic SEA campaigns, and advertising products dynamically (price and range). This gives advertisers the possibility to have two ads simultaneously on the search result page, which will have a positive effect on the expected clicks.
Naturally the available space for SEA ads will become smaller because of the PLAs which will likely increase competition for the remaining space, and impact on the CPCs in the search sector. In general it needs to be clarified to what extent the CPCs are linked to the PLAs and the search ads.
The advantage of placing simultaneously classic search campaigns and PLAs is that is attracts more attention and it uses a larger space on the website. Nevertheless, when conducting tests and evaluating the results online store operators might still notice that some products/product lines can be advertised even more efficiently through PLAs than through “normal” ads. This may lead to certain product keywords for normal ads being paused. The PLAs would thus have an influence on the keywords used for classic ads. Experience however from combined presence in the paid and the generic search engine sector suggests that this will not be the case. In every other sense search ads and PLAs are mutually beneficial. PLA campaigns, for instance, can be used to find out which products would be suitable for the landing page of an SEA ad and in return, experience from recent search campaigns can be used for the setup and optimisation of PLAs.
Although PLAs are subject to a charge, with an optimal setup and a regular product and CPC optimisation, advertisers can certainly benefit from them.
It is important to acknowledge them as a new discipline within the SEA sector, a discipline that requires some time and effort. Even though the costs will initially increase, with the right process and the right tools advertisers can use PLAs to drive greater conversions from search.