PHILADELPHIA, July 21, 2016 /PRNewswire/ -- Retailers racked up nearly double the revenue from Google product listing ads (PLAs) year over year in the second quarter. The paid ad format of Google Shopping delivered a 92% YoY revenue increase in Q2, outperforming its 52% YoY revenue growth in Q1, found Sidecar.
Other Google PLA metrics for the quarter followed suit. Orders grew by 92% and clicks grew by 125% year over year. With this growth came increased excitement from retailers. They showed greater interest in ways to make the most of product ads, with twice as many retailers adopting Sidecar's Google Shopping optimization technology in Q2 as they did in Q1.
"The stakes in Google product listing ads are growing—and paying off," said Andre Golsorkhi, CEO of Sidecar. "More retailers are making Google PLAs a cornerstone of their marketing mix. Google has long understood the efficacy of product listing ads and is doubling down on them. The reason is simple: They work. Google PLAs let retailers connect their relevant products to consumers, and let Google deliver on its value proposition of helping consumers find what they want in that moment."
Understanding how PLA performance differs by device is now taking on new significance, as more shoppers flock to mobile to find products and as Google develops device-specific ad formats and capabilities.
- Mobile. In the second quarter, revenue from Google PLAs on mobile swelled by 261% YoY (compared to 164% YoY in Q1), and their return on ad spend (ROAS) improved by 29%. Google said at its Performance Summit in May that it now handles trillions of searches, and over half are on mobile. Similarly, Sidecar found that 55% of PLA clicks happened on mobile in Q2.
- Tablet. Google announced in Q2 that users will soon be able to set individual bid adjustments for PLAs on tablets. The development comes at a time when tablet PLAs are already strong performers. Their revenue growth reached 120% YoY in the second quarter.
- Desktop. PLAs on desktop (excluding tablets) delivered 50% more revenue YoY. When comparing PLAs on all three devices, those on desktop had the highest conversion rate at 4.6%, and they drove just over half (57%) of the total revenue from Google Shopping in Q2.
The second quarter was an opportunity to see how PLAs performed since Google removed text ads from the right column of the desktop SERP in February. With PLAs becoming more prominent on the desktop SERP, Sidecar found their click through rate (CTR) grew by 5.3% in the 60 days after the change. Conversion rate, however, was nearly unaffected, growing by just 0.2%.
However, effects of the change varied depending on incoming search queries. On desktop devices, the conversion rate for generic queries grew by 9.5%, while conversion rate for branded queries grew by 11%. Conversion rate for long tail queries edged up by 2%. These findings highlight how search queries have different value to retailers' businesses, and, if managed well, search queries can deliver higher converting traffic to Google PLAs.
To address this opportunity, Sidecar added a new capability to its Google Shopping optimization technology in the second quarter: Search Query Management. The capability creates the right campaigns and sets the appropriate bids based on the words consumers use to find retailers' products, improving ROAS for PLAs.
The second quarter saw a burst of innovation from Google around its Shopping channel. Google added PLAs to its image search and rolled out its popular Customer Match feature to Shopping, in addition to announcing the tablet bid modifier for Shopping campaigns. Already in the third quarter, Google announced new Showcase Shopping ads for mobile, which could eventually expand to desktop.
Sidecar is an e-commerce marketing technology that uses machine learning to solve the complex, data-intensive process of connecting consumers to relevant retail products, in all paid marketing channels where consumers shop. Sidecar takes relevance to the next level, allowing retailers to display the right product ads to the consumers most likely to purchase them, at the right moment.
The technology considers an average of 1.2 million data points each day to analyze and index every product in a retailer's catalog, to ensure profitable growth out of paid customer acquisition channels across all devices.
Retailers that use Sidecar drive millions of dollars of new, measurable revenue and save time and internal resources, while maximizing ROI and improving the conversion journey for customers. Brands including Newegg, Boscov's, Serena & Lily, and Bealls count on Sidecar to optimize their product advertising campaigns. Sidecar retail customers average an 87% increase in YoY channel revenue and a simultaneous 15% growth in return on ad spend.