UPDATE: Smart Shopping Campaigns have officially been terminated by Google, and replaced by Performance Max campaigns. Similar, but different! To learn more about PMax, check out our articles here: What Is Performance Max in Google Ads? 

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Are you interested in getting Smart Shopping Campaigns back into Google Ads? Then test this Performance Max campaign strategy walkthrough on setting up Feed Only PMax Campaigns: 

Setting Up a Feed Only PMax Campaign - Step-By-Step Walkthrough To Get Smart Shopping Campaigns Back in Google

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Original article (written Mid-2019): 

At ZATO, we do a lot of Google Shopping Ads management (everything from little brands & retailers, to household brands like Traeger Grills and Purple Mattress) which means we do a lot of new feature testing. Because of this, the number one content piece we have had requested in the past few months is a guide to Google Smart Shopping Ads. This is a post I have been intending to write for awhile now, but I keep learning new things and it keeps growing. In fact, this is turning into a series of blogposts I will write over the next few months on all things Smart Shopping... so I promise the delay has been worth it!

One Year In

Google released their Smart Shopping campaigns during their Marketing Live 2018 conference one year ago (July 10, 2018).  In the past 12 months, we have gone from rolling our eyes at them, to ignoring them, to testing them, to optimizing them, and now to implementing them into our current Shopping Ads strategy (albeit it, carefully). This post is our attempt to pass along virtually everything (we can't give *all* of our secrets away, of course ;) we know about Smart Shopping with our hands-on campaign management approach, so you know what you are getting into before implementing them in your accounts.

What is Google Smart Shopping? A Definition

You've heard the term before (or at least earlier in this post), so what exactly is Smart Shopping?

Google's Definition: "Smart Shopping campaigns feature Product Shopping ads, Local Inventory ads, and display ads (including dynamic remarketing and dynamic prospecting), which are eligible to appear on the Google Search Network, Display Network, YouTube, and Gmail. Automated ad creation and placement means that your ads will appear in the ad spaces where they're relevant and that your bids will be set to maximize your conversion value."

ZATO's Definition: Smart Shopping is Google's Shopping Ad black-box (limited reporting) campaign type which automates Shopping Ads across any Google owned channel according to your target conversion objective.

With Legacy Shopping Ads (from here on out, our definition of "traditional" Shopping Ad campaigns), your Shopping Ads are eligible to show almost entirely on Search and Search Partners (as well as optional Display and YouTube variations, of course). They are Google's way of visually enhancing and ecommerce-izing their Search Results.

The primary objective of Shopping Campaigns is to show relevant product details to the purchase-minded consumer. It's a wonderful ad type in Search results, because it allows advertisers to show visual ads to people searching for specific products on Google or Bing.The Smart Shopping campaign is different, in that it shows Shopping Ads across Search, Display, YouTube, Gmail (and likely more properties to come with Shopping Actions and Discovery Ads in the future).

HEADS-UP: An important thing to note is that these are called different channels for the specific reason that people use them for unique reasons, and that works its way into their purchase intent. For instance, YouTube is phenomenal for brand building while Google Search (especially with Remarketing Lists layered on) can be exceptional at direct sales. With Smart Shopping campaigns, Google is lumping all Channels together...an important thing to keep in mind as we move through

The reason Smart Shopping has potential, is that it is utilizing Google's targeting across an astonishing number of data-points on the back-end to find the best audience for your specific products and in the right place...but can they deliver? I'll give away some of a future post (you'll have to wait for the details), by saying...kind of. We have been testing Smart Shopping for almost a year now and and we have seen it work inexplicably well, and inexplicably terrible. We have also tested a number of ways to help the system.

HEADS-UP: A crucial thing to keep in mind with Smart Shopping is that regardless of how well it works, it is almost pure automation. This means that, like anything, a machine can only do as well as the data you give it. If you feed it garbage, that's what you'll get in return. This means it's even more important to make sure that your product data in your feed is optimized. It also means that there are potential ways to implement Smart Shopping in your account without turning it loose on every product. At ZATO, we believe there are ways to feed Google better data based upon your account needs...we'll share some ways to do this in future posts!

Google introduced this campaign type as the future of Shopping Ads, and they apparently believe their own mantra because they are pushing this HARD. If you have anything to do with Ecommerce digital ad strategy, you have likely been pitched this from your Google rep, a Google rep, or someone Google at some point.
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But how should you use Smart Shopping?

I'm not here to debate whether this is a strategy or tactic post...we'll leave that for the guru marketers with too much time on their hands.

What I do want to discuss is what the specific strategy should be for your account as we begin to consider how Smart Shopping plays into the Shopping Ads channel within your broader marketing strategy. Having managed just under $1 million in Smart Shopping campaign tests, we believe there are certain ways to think about Smart Shopping that goes beyond simply enabling one campaign, and shutting off your Legacy shopping campaigns. I hope this post is helpful for you in this regard.

Smart Shopping Campaign Strategy

As you consider the best strategy for Shopping Ads in your account, especially as it comes to working Smart Shopping into the mix, it's important to realize a few ways Smart Shopping will impact your program.‍

Highest Priority...Always

‍Smart Shopping ignores campaign priority settings, and in essence takes over your traditional shopping program. This means any products you have in a Smart Shopping campaign will all but disappear from your Legacy Shopping program. What this means is, if you have a solid Shopping program running already and simply want to test Smart Shopping to see if you can improve your program, then you want to be very cautious in how you implement this, as it will not only shift all traffic from your current strategy to the new campaigns, it will also......kill any data you had in the account for Shopping Ads.

No Data...Ever

It is really crucial to understand this point, if you shift everything over to Smart Shopping campaigns you will get no search terms data, no audience data, no placement data (there is a hack we uncovered at ZATO and shared on this blog, but it doesn't show all placements/videos: How to Exclude Placements in Google Smart Shopping Campaigns), and last, and most face-palm-worthy, no channel data...that's right, they even created a new channel called "cross-network" in Smart Shopping campaigns.Be very aware when you test Smart Shopping campaigns, that you might see an increase in ROAS, but that it will be at the expense of data and control.

That's not always a bad thing, sometimes it is. If you ran only Smart Shopping campaigns for a year, and then had a topline-revenue problem that seemed to be related to Shopping Ads campaigns, but that you couldn't properly diagnose because you had no insights into anything that had been going on in an entire channel for an entire year... yeah that's moved from being a hassle to being very problematic. Let's continue requesting to Google that they become more transparent with Smart Shopping campaigns!In the meantime, it can still be worth testing, as we have seen successful ROAS and revenue increases. We like the idea of getting lower cost eyeballs with Google's targeting, across multiple channels like Youtube and Gmail. Because of that dilemma, we have begun to utilize the following tactics for working Smart Shopping into our existing strategy.

It's helpful to think of your Shopping account in terms of my favorite afternoon snack, the coffee break. In this scenario, your coffee is your stable snack foundation. It is the cornerstone of your snack, and even as you have the flashy, sweetness of a pastry added in... you couldn't do it without your coffee. That coffee is your Legacy Shopping program, you're going to have things grouped wisely for bidding purposes using smart custom labels and product group segmentation, and you'll likely be trying some advanced strategy like the Query Filtering strategy I wrote on here: A Step-By-Step Guide To Query-Level Bidding In Google Shopping.The pastry then, is your Smart Shopping program. That is, it's sweet and delectable and adds flavor to the program, but isn't yet your core program. In this way, we'll look less at replacing our Legacy Shopping program with Smart Shopping, but in supplementing it with Smart Shopping.Also, I'm enjoying my afternoon snack right now. Here are 3 of my favorite tactics for working Smart Shopping into your current program.

Smart Shopping Tactic #1: Core Products

In this strategy, we are targeting our key products that we want to ensure get the widest branding available, and we test these top 10-20 core products in Smart Shopping. We then keep the remaining products within our successful, already running Legacy campaigns as the foundation of the account. This strategy works great if you already have a very solid Legacy program, but want to experiment with new ideas.Note, you may want to be cautious with this strategy if your core products make up 80% of your revenue. In essence, this strategy would shift your entire Shopping strategy to Smart Shopping, and thus the concerns noted above. We find this works fairly well in accounts where the top selling products make a dent in the overall sales, but do not play too large a role in the overall sales.

Smart Shopping Tactic #2: Peacock Products

Think of your Peacock Products as your top salespeople. They are products that flashy and attractive, bringing interest to the store (even if they're not primary revenue or AOV drivers), giving you the opportunity to up-sell and shift into your core products.These products could be clearance items, or weekly specials that change frequently, but keep the same custom label so your Smart Shopping campaign is always pushing forward your best deals across the internet. There are many, many ways to think this through and implement, but think of this almost as more of a branding play. Pull the ROAS target off of the campaign and let Google push these far and wide spreading the good news of your store.

Smart Shopping Tactic #3: Supplemental or International Tests

Finally, you might need to quickly test a new arena out where you need insights into which products or brands will perform better. Smart Shopping can be a good way of testing this out. Let's say you've been running US-targeted campaigns and you want to break into the UK market. You might consider starting with your top 20 selling brands in the UK feed by creating a new UK-targeted Smart Shopping campaign (with the new multi-country feeds and currency conversion in Google Merchant Center, it has literally never been easier to launch new products in new countries), and monitoring for any sales learnings. To reiterate, you won't get any query or audience data from this, but it is exceptionally easy to implement and you can use it to (a) fill other audiences and (b) get product-market fit based on pushing out your key brands across multiple channels with Google's optimization.Hopefully those 3 suggestions have given you some ideas on how to best test Smart Shopping in your account. In the meantime, you can continue reading through our series on Smart Shopping with the next post:Should You Switch From Standard Shopping Ads to Google Smart Shopping?...and please consider sharing this post on Twitter or LinkedIn if you found this content helpful.

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