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Google Shopping is not profitable - what am I doing wrong?

Visitor ✭ ✭ ✭
# 1
Visitor ✭ ✭ ✭

I have perhaps slightly more overheads than some others, as I outsource my fulfilment, but all my other costs are low... it's just me working all hours in my spare time; yet I'm finding it impossible to make any profit using Google Shopping. 

 

I can't help but think I must be doing something very wrong? 

 

I've calculated that based on the number of people I actually convert, I can't afford to spend more than 21p per click. As soon as I drop to this level I get no clicks at all, only impressions. I'm obviously not beating others.

 

But if I raise this higher so I can win some clicks, it's taking around 50 clicks before I get one conversion, which is taking all my profit. 

 

Can it be that Google Shopping is just not profitable for my business?

 

I tried to improve conversion on the site to see if that was the problem - I've made a bigger cart, and offer free shipping but open to any ideas here.

 

I've also added in loads of negative keywords. Nothing is helping. 

 

Any tips, or do I need to abandon Google Shopping? 

 

Thanks for your help

2 Expert replyverified_user

Google Shopping is not profitable - what am I doing wrong?

Explorer ✭ ✭ ☆
# 2
Explorer ✭ ✭ ☆

Hi Gemma,

 

Couple of things you could try:

 

- Update merchant centre to include every bit of product information possible.

- Reduce the times of day you're advertising to only your best performing hours.

 

Can I ask what products you sell? It may be that the sales funnel is fairly long for your product (A new window, for example).

 

Google Shopping is not profitable - what am I doing wrong?

Visitor ✭ ✭ ✭
# 3
Visitor ✭ ✭ ✭

Thanks for your reply Matthew.

I've already set Google Shopping so advertising stops from 11pm each night. Perhaps I need to tweak this further. 

My store is hosted by Shopify so I have an app which feeds information into Merchant Centre and I'll be honest I've not really looked at the data it sends across in much detail, so that's a good idea. I will have a look and see if I need to add anything. Thank you.

I'm selling baby clothes, toys and nursery decor. 

 

Google Shopping is not profitable - what am I doing wrong?

Explorer ✭ ✭ ☆
# 4
Explorer ✭ ✭ ☆

You could also take a look at what areas you're advertising to, if you notice that one area is gaining a lot of clicks but not converting, you might want to set a lower bid adjustment.

Also, a bit of a no brainer but checking your price against your competitors is always a good tactic.

 

Let us know how you get on,

 

Google Shopping is not profitable - what am I doing wrong?

Top Contributor
# 5
Top Contributor

baby clothes, toys and nursery decor...

 

These types of products typically have low conversion rates because people keep browsing until they find something they like. It's not like a tech product or book where they just want the cheapest price / best service.

 

I have seen studies where (for people who purchased) the product people click on is more often not the one they bought. They see something that appeals, browse the site, and buy something else.

 

So consider making your most searched for product as appealing as possible (price, pic, description) to get people into the store.

 

Google Shopping is not profitable - what am I doing wrong?

Badged Google Partner
# 6
Badged Google Partner

What kind of sales are you getting overall? If you have no sales from any other channels, simply creating a shopping campaign is not going to change that. If you are getting sales from other channels, and/or other AdWords campaign types, then how many more sales could you get if you invested the same amount of time and effort into the channels that are profitable?

 

Tom

Re: Google Shopping is not profitable - what am I doing wrong?

[ Edited ]
Top Contributor
# 7
Top Contributor

as was previously indicated, gross-margins can be rather low; typically,
competition tends to be focused on price or value, such as service.

 

for google-shopping advertising, there are two basic ways to improve
overall performance -- improve the bidding strategy or improve quality.

 

bidding strategies relate to targeting, seasonal trends, product-groups, etc.;
improving quality relates to all data submitted, the landing-page, the website,
service, delivery, and possibly limiting advertised inventory -- for example,
only submitting, or only bidding aggressively on, high-margin items.

 

generally, carefully review all available data within the
shopping-campaign, before, during, and after any changes.

 

as an aside, "outsource my fulfilment" tends to raise a caution-flag.

 

with respect to shopping-ads, if the outsourcing fulfillment is part of a
supply-chain, such that the products are fulfilled through a drop-ship
consolidator or similar commissioned-based relationship, then that

is a policy violation and grounds for disapproval or suspension from

the program, at any time.

 

see also
https://support.google.com/adwords/answer/3455573

Google Shopping is not profitable - what am I doing wrong?

Visitor ✭ ✭ ✭
# 8
Visitor ✭ ✭ ✭

There's no drop shipping involved. It's a virtual warehouse as I can't store everything at home and ensure all orders go out the same day by myself. I own all the stock, I just pay for the service but it's cheaper than maintaining my own warehouse and staff full time. There's no policy violation. 

Google Shopping is not profitable - what am I doing wrong?

Visitor ✭ ✭ ✭
# 9
Visitor ✭ ✭ ✭

Hi Tom,

 

Thanks for for your reply. Im a fairly new startup. We've been trading for around 5 months now. My results from other channels are mixed. Most sales are actually from Instagram which I was surprised about. I'm in the UK and there's no buy now integrated into Instagram yet. I have mixed results with Facebook advertising. I've been working hard on SEO over the last couple of months and it's seen a big increase in traffic off the back of it and now it's my second most successful sales driver. My sales numbers are so low overall that it's difficult to see many trends and it's also why profit is so easily impacted by Google Shopping campaigns. Maybe I need to focus more on the other areas for now and come back to Shopping when I have more room for mistakes to be made. 

Google Shopping is not profitable - what am I doing wrong?

Visitor ✭ ✭ ✭
# 10
Visitor ✭ ✭ ✭

Thank you. That's good advice I will have a look into that. I've also been thinking I perhaps need some larger ticketed items as then there will be more profit to play with if I push those on Google Shopping. Most of my items are £10-40 with an average cart of only £37 so there's not much room for mistakes there. Larger value items would give me a little more to play with. Thanks for your help!