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The Best Google Ads Strategy in 2020 Embraced Flexibility

Many retailers who increased marketing spend on Google Ads during the most uncertain times in the pandemic saw big gains. When online shopping surged in March and April of 2020, retailers who decided to increase their presence on Google Ads, as opposed to pulling back, captured more shoppers at significantly lower CPCs than was the norm in previous years. The best Google Ads strategy of 2020 relied on flexibility to adjust to changing demands.

That was one of the big lessons from the 2021 Benchmarks Report, said Sidecar Director of Enterprise Customer Strategy Jonathan Martin, during an episode of Retail Uncharted. “An appetite for risk is really important. There was so much uncertainty for such a big chunk of the year, but the Sidecar customers that held budget, increased budget, or maybe expanded their ROAS goal to be more flexible, were able to capture so much traffic as it came online.”

“I remember having conversations with our customers when we first saw the surge,” added Sandie Shin, Director of Customer Strategy for Strategic Accounts at Sidecar. “We asked, ‘Will these shoppers come back? How do we make them purchase a second time around?’ It turned out to be a lot easier than we thought it would be. Once the shopper has a good experience with a brand or retailer, they come back.”

In this episode of Retail Uncharted, Jonathan and Sandie dive into the data from the award-winning 2021 Benchmarks Report. The report, now in its fifth year, shares year-over-year performance benchmarks for Google Ads, Facebook, Instagram, and Amazon, and offers valuable insight into how retailers stack up against their competitors. During the podcast, Jonathan and Sandie discuss the most surprising findings from the report, and share practical strategies retailers can apply to their Google Ads campaigns in 2021 and beyond. 

During the podcast we asked Jonathan and Sandie:

  • Why do you think Google paid search experience significant increases in ROAS year over year, up 31%?
  • What are two keys to achieving consistent growth on Google Shopping?
  • Were there any retail verticals that stood out to you in terms of performance in 2020 on Google Ads? Why did that vertical have so much success?
  • What advice do you have for retailers looking to reassess their monthly budget on Google Shopping and paid search?
  • Why was flexibility such an important factor for retailers looking to navigate the pandemic?
  • What advice do you have for retailers looking to build more flexibility into their campaigns so that they can better react to market shifts?
  • How can retailers build better structure into their Google Ads campaigns to drive greater efficiency?

Top Sound Bites

On the consistent decline of CPCs on Google Ads:

Jonathan:  I was surprised to see CPCs go down year over year in Google Shopping. I think it was really a year where we were seeing such performance and so much success in the channel that we expected potentially more players coming in, or maybe more traditional retail outlets going into this space and seeing CPCs increase.

I think instead we saw a lot of major players pulling back and either being more conservative with budgets for different times of the year or facing inventory and supply chain issues around holiday. And it was a nice reminder that there’s real opportunity. Even with so many more shoppers, we saw a better return on ad spend and better conversion rate. It was also a cheaper space to enter and we’d encourage people to, rather than pull back, go in and capture some of that traffic.

On the importance of evaluating search queries regularly:

Sandie:  When the pandemic broke out, we saw incredibly high demand on certain products, whether it was hand sanitizers to toilet paper. When you’re not evaluating these search query reports regularly, it’s easy to miss out on these demands. And sometimes it backfires where your spend shoots up or you miss out on better performance. Quickly identifying high spending terms and negating them really ensures that we can keep our customer’s performance reliable and steady.

Tips for allocating budget across Google Ads:

Sandie: I think it’s important to segment the budget in a way that makes most sense for your business. Instead of breaking it down just by channel, which is Google Shopping and paid search, break it down even further by brand and non-brand keywords. On paid search, break it down even further by your core trademark terms on exact versus a trademark term on phrase match.

For core trademark terms, you can easily predict what your monthly spend is going to be just by using historical data, and you know your ROAS is always going to be good.

With your trademark terms on phrase, you need to make sure you can continue to own the SERP and ensure that no other competitors are bidding on your core trademark terms.

I would really recommend thinking of your budget in that level of granularity and see how that matches up to your overall business, as opposed to just focusing on the channel splits.

On the rise of privacy and its impact on Google Ads:

Jonathan: Privacy’s absolutely the word that we’re hearing a lot, and it’s really difficult to predict what Apple’s iOS update with opt-in will mean for mobile tracking, or Google moving to federated learning cohorts, is going to mean for performance.

But one thing that we’re really seeing and recommending is making sure you have a strong prospecting strategy. It looks like specific user remarketing is going to be challenging. It’s important to capture new customers. Make sure that you’re thinking about broader audiences to target based on characteristics that aren’t tied to individual traffic history. That’s going to be important given some of the privacy changes that happened between Apple and Google.

But also make sure your business is staying healthy by acquiring new customers and not just relying on traffic volume or the same customers that you might’ve acquired anyway, without a pay-per-click ad.