Google AdWords For Ecommerce:  A step by step beginners guide

Overview

Ever see online ecommerce stores that seem to become successful in a short time? With large social media followers, a large number of reviews and sometimes 7 figures annually. What is the secret? One method is that they turbo charge their sales with Google Ads (previously known as Google AdWords).

Using AdWords for your ecommerce store is a great fit because it positions customers with sellers very easily. So easy in fact that Google Ads account can account for as much as 18% of all ecommerce revenue. Because Google Ads is a large advertising platform with several different advertising options to choose from, it can get a little confusing what features are relevant to you as an ecommerce business.

So, we have put this guide to help you boost sales overnight with tried and tested ad strategies. Let’s get into it.

Setting up the right foundation

With the above being said, Google Ads is not always a good fit for every business. Yes, ecommerce businesses get a ton of revenue and sales from Google Ads. Here are a couple of must haves before going down the Google Ads path.

Budget

The question you need to ask yourself before embarking on running Google Ads is, do you have enough budget to really test this marketing channel? The starting goal is to not develop a complete sales channel, but to find if it is a good fit in your current marketing ecosystem. A couple of factors to consider.

  •       How long is your selling cycle? (How long does it take for your customers to make a purchase)
  •       What are your profit margins?
  •       How competitive is your industry?
  •       What is your average market CPC?

Ideally your minimum budget a month should be around the $1000 mark to test. If you only have a few hundred dollars to spare, save it up until you are in a better position to invest. Having a small budget will not get you the data you need to scale and grow your account. If you have a large volume of products (e.g., over 2000), do not try and run a campaign covering all of them, focus your budget on the things that are likely to convert.

Store Pre-requisites

Before starting a campaign, check that your store qualifies with the following.

Product knowledge: do you have well written product descriptions, shipping and returns policies and clear frequently asked questions?

Pricing: are your prices competitive to the market?

Assisting marketing infrastructure: Do you have email auto responses set up, such as email capture, welcome emails, cart abandonment and shipping confirmation emails?

Just like selling a home, it is important to get your house in order before bringing in a number of people to come and look to buy.

Preparing your campaigns

Before diving into creating a campaign, it is important to know what you are wanting to achieve. The main objective for ecommerce stores is quite simple – sales and revenue. Before you do anything though, you should calculate your break-even return on ad spend. That way you know if your ads are profitable or not. To calculate your break even return on ad spend use this formula.

For example

Your client is a travel agent that specializes in booking first and business class airfare. Each ticket they book generates an average of $1600 in revenue.

About 65% of that revenue goes to the cost of booking the ticket and 6% of the revenue is paid out to salespeople for commission.

65% of $1600: $1040 (1650 x .65)

6% of $1600: $96 (1600 x .06)

Out of the $1600 in revenue, your client makes a profit of $464. In essence, your clients profit margin would then be 29%.

Simply divide your profit margin by 1.

1 / .29 = 3.4 (or 340%)

In other words, your client needs to make $3.40 for every dollar spent in advertising.

To explain break even ROAS in a non-mathematical way, you can look at it this way: For your client to make a $1 of profit, they need to generate $3.40 of revenue ($1 is 29% of $3.40). You then subtract the $1 spent on advertising and your client breaks even.

In our above scenario, if your client generates more than a 340% ROAS, they are making money. If they are generating less than 340% ROAS, then they are losing money.

 

Research Your Customers

Once you have worked out your key goals and measurement, you need to know who you’re targeting and how to impact and influence your audience.

Conduct Keyword Research

If you have done keyword research before for blogging, it is a similar process for a Google Ads campaign with some additional factors. Your Google AdWords keywords need the following.

  •       Be specific about your product (or what your landing page is about)
  •       Be grouped into relevant lists no more than 10 keywords.
  •       Address each stage of the buyer journey.
  •       Consider the market cost per click of each keyword (this can be found using third party tools such as SEMrush or Google Keyword Planner

Here’s an example Ad Group

Landing page: www.audiovisual.com/hdmi-cables

Keywords: [hdmi cable], [4m hdmi cable], [1m hdmi cable]

Each group should have relevant keywords tied to the landing page. Check to see what the average CPC is for each keyword to gauge how much budget is needed to meet the minimum entry into the ad auction process.

Develop a strong marketing message

Now’s the time to start planning your ad headlines for your search advertisements. To begin with, we suggest using responsive search ads over expanded text ads. This helps to find winning ad combinations which can be further split out to individual text ads once enough data has been captured. Utilize unique selling points when available and include call to action words such as Buy, Shop and Get in your ad headlines.

Setup your Google AdWords Campaigns

While you could start with any campaign type and see results, it is not the most effective way to start out for ecommerce stores based on our experience. If you’re not careful, you could blow your budget out with lacklustre results as you’ll be going up against competitors that have years’ worth of data to leverage. The first three types of ad formats for ecommerce stores to use to begin with are:

  1.     Shopping ads
  2.     Remarketing ads
  3.     Search ads

The other ad formats you can utilize once you have some runs on the board with the other campaign types. Will go through and break down the pros and cons of each campaign type and how to set them up for success as well as providing a difficulty rating in set up. But running the top three in that order will make it harder for you to make some key mistakes while starting out.

Google Shopping Ads

Google shopping ads can appear to be quite daunting at first due to the amount of work that is involved to get them up and running. It can be technical to begin with but if you can overcome this then the results far outweigh the effort.

To run shopping ads, you need a Google Merchant Centre account and a product data feed. A product feed can basically be a large spreadsheet with all your product data. The challenge with this is that it requires you to provide a large amount of product attributes and put it into the format that Google wants. If you are on a web platform such as Magento, WooCommerce or Shopify then you are in luck and there are apps and plugins that can do a large amount of the heavy lifting.

What these extensions do is connect your website platform to Google Merchant Centre via either a scheduled data upload or via an API connection. Once the data flows into Google Merchant Centre, Google will review the quality of data and will provide feedback on what has been submitted. When all the red errors have been taken care of, then you are ready to move on to setting up your Google Shopping Campaign.

To begin with you will need to start with a standard Google shopping campaign. Ignore the smart shopping campaign for the time being. Your account does not have enough conversion data in a new account for it to work properly. Ignore the guides out there that compare the two, the idea is to scale to a smart shopping campaign as it does deliver solid returns when configured correctly. The main difference between the two is that with Smart Shopping, Google will take some things out of your hands such as individual product bidding, search queries and ad placements. This does reduce initial management complexity, but without the groundwork of data laid out beforehand it is difficult to turn a profit. Select that standard Google shopping campaign to begin with, you will be thankful you did later.

The next important step which what most people miss is this.

Negative Keywords

With Google Shopping campaigns, you cannot pick the keywords that the ads will trigger and appear for, but what you can do is add negative keywords to stop them from showing up. Here is a list of common negative keywords you should probably add to your account. A key thing to check while your campaign is running is your campaign search queries. If there is a particular word you would like filtered out, then use phrase match negative keywords. These are negative keywords that use quotation marks. There are also a few good keyword research tools that will show related keywords that can give you a few ideas to avoid.

Bidding

Way too many put too much focus on this part, especially on lower budgets. If you do not know what your market CPC is and you have a small budget to test with, run a maximize clicks budget with a bid limit of $1 to $2. That will give you an idea of what your products are mostly triggering for, and you can work back from there. Once you have enough conversion data, you can then move to a smart shopping campaign utilizing a target roas bidding model.

Along with bidding, something that is overlooked is placing bid adjustments based on a user’s characteristics. Possible bid adjustments can be on

  •       Devices
  •       Location
  •       Audiences
  •       Ad Schedule

These adjustments can be made from -100% to 100%. I would advise only adjusting 1 to 2% to begin with, as these adjustments can compound and can quickly drain and inflate your CPC if you are not careful.

Audiences

Audiences are important with shopping campaigns, by adding audiences you can adjust your bids on search queries based on visitor in market behaviour. You can also add remarketing lists from people who have already visited your site (will touch on this again a little later). There are two options with audience targeting: targeted and observation. For a shopping campaign make sure that you have targeting set to observation, so you do not limit the volume of traffic you are bidding on.

Product Feed Optimization

Product feed optimization is where you can get the best results, as Google shopping runs on the information that you provide in your product feed. Here are a few impactful optimizations that you can implement straight away to help your campaigns.

Product titles

Google uses this to help match its search queries, so if you have the wrong keywords in the title then you will not match with the right queries. There is also a cut off on product title length, so you need to ensure that you have the most important keywords at the start of your title.

Product identifiers

Something that is missed a lot in ecommerce stores are product identifiers. These are brand, global trade identification numbers (GTIN) or MPN’s (manufacturer part numbers). In way of data, these are the holy grail as it lets Google know exactly what the product is and can compare it to other stores that are selling the same product. It helps a lot with product visibility to include them in your data feed.

Product images

Are your product images clean? Or do they have a bunch of text overlays? For images sent to Google it is best to send the product on a white background as the primary image. On your website, include model and branded shots, but the primary image must meet Google’s image requirements to be included in search.

Remarketing Ads

The next campaign that you should consider is running remarketing ads. Remarketing is Google’s terminology for retargeting, they are both the same. Remarketing ads are a display ad that appears on other websites to people that have already visited your website. You would have seen them before as you browse the web.

There are two types of remarketing ads – static or dynamic advertisements.

Static remarketing campaigns are where you show the same advertisement to all website visitors. It is generally just a branded ad that advertises your business with clear overarching selling points. Dynamic ads are a bit different as they connect with a product feed and show products that they previously looked at.

To begin with, it is best to start of with responsive display advertisements as they are the easiest to set up. If you have the graphic design skills, you may consider creating different banner sizes. You are better off saving the time and using high quality images to create responsive ads. Image ads after compression generally look quite terrible, but a more advanced practice is running HTML5 advertisements that gets around this issue.

Google will also ask you to fill out headlines, descriptions, logo’s, images, and there is also the option to add in videos from a linked YouTube account. To make the ads serve dynamically with different products, if you have set up a product feed you simply just need to opt in for the dynamic remarketing program in Google Merchant centre and select the data feed under the campaign settings.

Set up your audiences

For your audiences to be captured you need to have a Google Analytics tag installed. With this you can break down your traffic into engaging lists and port them over to the Google Ads platform. With this you can target your ad traffic based on how many days since the last time they have visited your site, if the person is a first-time visitor or if they have browsed several pages of your site. The options are endless. You can also create exclusion audiences, for example if you want to filter out visitors that are only on your website for less than a few seconds. This helps to eliminate spend on traffic that bounced immediately the first time, allowing your budget to get back in front of people that matter.

Search Ads

Search ads are the most well known of advertisements on the Google Ads platform. Generally, when people refer to Google Ad’s, they most have these types of ads in mind as they have been around now for over a decade. Due to them being around for so long, other businesses have had the time to get good at them as well as be super optimized buy Google. Because of this, they can be more of a challenge to get success. If you are getting some success from shopping and are looking to expand and grow your account, then giving search ads a try is the way to go. You have a lot of freedom and options with search ads so let’s look at a few proven tactics that work.

Optimize your search campaign settings

When starting out there are a few options you should avoid to help you get off on the right foot. There are multiple networks that search ads can run on and appear. By default, Google selects Search Partners and Display Network already enabled. Do yourself a favour and turn this off. The traffic from these sources is generally pretty rubbish. Once you have some quality data, then consider adding in search partners for additional reach but for now, turn them off.

Another mistake is the wrong selection of bidding model to begin with as they do not exactly know what to start with. Avoid Google’s recommendation to start with a maximize conversion strategy, you simply do not have enough data at this stage to get it to work. Opt first for a manual CPC or a maximize clicks strategy to assess your traffic and costs.

Understanding Keyword Match Types

Keywords are what you select for what search queries you would like your advertisements to trigger for in Google. This is an important step and the key to success is to coming back to understanding your customer, which we talked about earlier on in this article. If you pick keywords that are too general, then you will get visitors that are less likely to purchase. If you go too specific, there may not be the volume of traffic and only get a handful of clicks. It’s about balance and to help with this is by understanding how the different match types work.

Match Type Symbol Example keyword Ads may show on searches that contain Example search query
Broad match None hdmi cable Close variations of the keyword, related searches and other relevant variations. Buy hdmi cable
Broad match modified +keyword +hdmi +cable All the terms designated with a + sign in any order. Additional words may appear before, after or in between the terms. 4k Hdmi lead
Phrase match “keyword” “hdmi cable” Matches of the phrase with additional words before or after. What is the best hdmi cable
Exact match [keyword] [hdmi cable] Exact matches of the terms or close variations of the exact term with the same meaning. hdmi cable

 

If you do not add these symbols and select a match type, Google will use broad as a default. Unfortunately, without this steer, it gives Google permission to go a bit vague. For example, if you put in tennis shoes, google may also show your ad for queries for hiking boots. It’s best to be more specific then too vague, this counts for both keyword match types as well as the keywords.

Break your campaigns into keyword structures.

This is also critical to the success of search ads. A well-structured account with the right campaigns targeting the right keywords means that the right ad will appear for the right search query. And with a bit of time and data, at exactly the right time. A good structure will also mean good quality scores for your keywords.

A few questions you need to ask yourself is.

Which keywords should you put into the same ad group?

How many match types should I use?

What campaigns should I create?

Should I create ads for each product? Or for each category?

Here it really depends on the types of products that you are selling and how popular they are. Are you a one product store? Then create ads just for that product. Are you a multi-product niche store? Then break your advertisements down into product categories. If you have a hot selling product, you may then want to break it down into targeting that specific product.

Here are a few rules of thumb that will help to give you a steer.

  1.     Split non-branded from branded traffic.
  2.     Split campaigns by country and language
  3.     Replicate the structure you have on your website with your campaigns.
  4.     Split campaigns into keyword match type silos

Once you have your campaign idea’s broken down, now you can create your campaigns. What we recommend is to build a keyword match type silo. This ensures that keywords are performing correctly and not bidding against each other. What that keyword silo looks like is something like this. We break keywords into their types of broad match, phrase, and exact match. We then negative keyword exact match terms in broad match and phrase match campaigns and vice versa. If the exact match terms are not negative keyworded in these campaigns, the broad match and phrase match types can also trigger for those search terms.

 

Optional: Display Ads

Google display ads are text, video and image ads that show up on the Google Display Network known as the GDN. The GDN is a group of google owned web-based properties and third-party websites that opt in to advertise. The GDN reach is huge with the network including YouTube, Gmail and 2 million websites and apps that show AdSense advertisements.

To run effective display campaigns, you need to change your mindset. With shopping and search advertisements, you are aiming to show ads to people that are actively looking for your type of product. But with display ads, you are showing them to people who are not in a buying or search mindset initially, so you need to interrupt them enough for them to act to be effective.

2% of internet users also use ad blockers and is a trend that continues to grow. It is also a network that has a high level of click fraud. We have discussed remarketing ads before which also utilizes the GDN. So, what is the main difference you are wondering? The idea around display ads is to create them for cold audience targeting and brand awareness. If you are seeing results with shopping, remarketing and search, it may be an idea to extend your top line funnel.

The most common display ads are responsive display ads where you can add logo’s, images, headlines, descriptions and then Google combines them into the most optimal ad sizes. These can look a little basic and if you have the time and budget, it may be worth getting some HTML5 assets created.

Demographic targeting

The easiest option of display ad targeting is using demographics. There are the basic targeting options of gender, age, parental status as well as household income. A good hack tip here is to look at your existing demographic data of your search, shopping and remarketing campaigns to help give you a steer. This will allow your display ads to show in front of similar customers. It also allows you to help filter out groups that wouldn’t be a good fit for your display ads. For example if you have a very gender specific niche product, you could exclude males from being able to view the display ad.

Keyword targeting

Keyword targeting for display ads is a little different from searches. Here, the keywords that are entered will appear on websites that reference and matches that keyword. Do not worry about match types for this type of campaign, you only have broad as an option. For example, if you sell gaming chairs, you could target websites that may have reviews of gaming chairs or on game review websites. That way you are building an awareness of your product on a topic that is close to your service.

Topics

If you really want to get specific and do not want to leave it up to keywords entirely, you can select topic targeting. These are pre-made interests that Google has put together themselves. They are quite broad, so it might be worth to utilize and test both.

Placements

This is a very important setting and can drastically help to get your ads in front of the right people. In way of placements, ensure that you exclude irrelevant apps. These are some of the biggest budget wasters imaginable. And if you have not done this for your remarketing campaign, go and do it now. App placements can be rife with click fraud. With placements you can be specific with what website apps and channels you want to target so your ads to appear on. It would be wise to research to see what audiences would be viable to get in front of to utilize this feature.

Audience Targeting

Audiences are data ich profiles that Google segments based on it’s entire user base. They do this a number of ways, based on your demographic, your interest, habits, what you appear to be actively researching as well as what businesses you have interacted with in the past. All the behavior that you do online is tracked, measured and segmented and then can be used as leverage to advertisers. The audience categorieze broken down are:

Affinity: These are groups of people based on their lifestyles, buying habits and long term interests

Intent: People who are actively researching products or services

Remarketing: People who have previously interacted with your business. There is also an option to target similar audiences, if you have done any Facebook advertising you would be familiar with this concept.

So, which do you use? As I have covered remarketing before, that is an essential display campaign to use. For extending the top of funnel acquisition, I then find in-market and then affinity audiences to have the most success. It really is a case-by-case basis to find some success and requires some experimentation. Going back to the beginning of the guide and understanding your customer is a great exercise to apply this to.

Optional: YouTube Ads

YouTube ads are a special kind of advertisement, and its success lies in how you bridge the gap between why they are on YouTube and the products that you sell. YouTube ads are difficult as it is success really comes down to the creative.

If you do not have the budget for it, I would not attempt it as you will just blow through your budget. I have seen past clients blow through a few thousand dollars using poor ad creative that was shot on an iPhone.

If you have the budget to work with (e.g. minimum $20k) or if you have the videography skills at your disposal, I would advise to go a long form video that you can repurpose across multiple ad formats. The ad formats that are available on YouTube are as follows.

YouTube Ad Formats

  •       Non-skippable in-stream ads: these ads cannot be skipped and play for 15 seconds or less.
  •       Skippable in-stream ads: these ads appear before, during or after another video and can be skipped by the viewer after 5 seconds.
  •       Discovery ads: these are ads that appear as a promoted video next to a playing video or shown in YouTube search results.
  •       Bumper ads: Quite popular ad format, these are 6 seconds or less that cannot be skipped.
  •       Outstream ads: these are video ads that run outside next to YouTube ads. They show up on the side bar as promoted suggested videos. 
  •       Masthead ads: Are expensive and they take over the YouTube homepage, the impression reach on these is massive.
  •       Shopping: video ads that are linked to a google shopping feed.

As you can see, there are a few formats to try. Just do not try to do them all at once. There are a lot of moving parts, so pick an ad format that you think is most suitable to your creative and then test different audiences.

Measure Your Success

Ok so we have covered a large part of the different types of ad formats there are with some basic action points. Something that is often overlooked by starting out is not setting up conversion tracking properly. What is a conversion? For ecommerce, ultimately it is a sale. Out of the box ecommerce platforms such as Shopify makes it easy to set up your conversion tracking. Other platforms such as Magento and WooCommerce can be a little bit more difficult that requires the help from a web developer. The important thing to capture here is “revenue value”. When you have that data flowing into Google Ads, you can set up what your return on ad spend is which is your conversion value divided by your advertising cost. This is essential for ecommerce as it will allow your campaigns to optimize based on the dollar return. Allowing you to scale, grow and get more revenue. 

We could go into detail on how to set up conversion value tracking, but it varies between each platform. Keep your eyes peeled for further content on Google Ads and popular ecommerce platforms where we will dive into conversion value tracking for each.

Conclusion

We have covered a fair bit in this guide to get you started on your PPC ecommerce journey and your to do list is probably a lot larger. Hopefully with the exercise we outlined at the start as well as focusing on the core campaign strategies, you will see what is clear and what you should be focusing on. We have additional guides in the works that cover each section more in depth than this guide, so like and subscribe to our content to get the most up to date practices and strategies with PPC for ecommerce.