Google Ads is an increasingly congested and competitive performance marketing channel. Retail marketers must uncover new ways to achieve incremental revenue for success. That could mean targeting more granular audiences, focusing on high-converting search terms, or tapping into new ad formats. After analyzing millions of data points across 14 retail verticals in the 2019 Benchmarks Report: Google Ads in Retail, Sidecar has uncovered key channel opportunities.
The house and home market is evolving. Shoppers have greater comfort purchasing big-ticket items on their desktops and mobile devices. They are researching products earlier, and they’re spending more than ever before. In this article, we’ll dive into the biggest trends shaping the house and home vertical in 2019 across Google Shopping and paid search. See how your performance stacks up against the following market trends.
Revenue Is Up for House & Home
In the house and home vertical, Google’s shopping (+8%) and paid search (+9%) channels experienced year-over-year ROAS gains in 2018. Revenue increased on both channels, up 27% year over year on shopping and 22% on paid search. These gains demonstrate that both ad formats are key tactics for house and home retailers, who continue finding ways to increase efficiency.
House and home retailers also increased spend in paid search, a channel where spend remained flat or even declined in several retail verticals. Paid search spend increased 13% year over year in 2018. Similarly, Google Shopping spend increased 10% year over year. Despite increasing competition, there are still growth opportunities for house and home retailers on Google Ads.
Mobile Drives Revenue Bump
One of the contributing factors to house and home retailers’ success in 2018 was the rapid growth of mobile shopping. In 2018, paid search mobile revenue increased 31% year over year. During the same period, Google Shopping mobile revenue grew 39%. Spend on these channels also increased—7% in Google Shopping and 2% in paid search.
Both average order value (AOV) and revenue per click (RPC) increased on mobile shopping and paid search ads, suggesting that retailers’ success is due in part to shoppers’ growing comfort purchasing on mobile devices. Improved mobile site speeds, responsive design, and ease of navigation are helping shoppers find the content and products they need to make an informed decision.
Retailers Move Up the Funnel
House and home retailers are differentiating themselves on the SERP by delivering messaging to shoppers earlier in the buying process. Showcase Shopping ads are a powerful way to engage shoppers during the research stage of their purchase journey because they appear for general search queries. Google delivers Showcase Shopping ads to mobile shoppers. The ads display multiple products using eye-catching lifestyle imagery, capturing the majority of the mobile SERP.
House and home retailers experienced a huge jump in Showcase Shopping engagements. Clicks grew 7X in 2018 year over year. Retailers also increased their Showcase Shopping spend 10X year over year. The increase in both engagement and spend may contribute to the vertical’s significant mobile growth in 2018.
How House And Home Retailers Can Adapt
Given these trends, house and home retailers must continue to invest in mobile strategies, develop tactics to reach shoppers earlier in their shopping journey, and provide valuable content to help shoppers make informed decisions. The following tactics are a few ways you can achieve these goals and improve your Google Ads campaigns:
Optimize for Mobile: Dedicate greater resources to mobile in order to capitalize on Google Ads growth in the house and home vertical. Consider creating mobile-only shopping and search campaigns. This will allow you to set granular bids specifically for mobile shoppers and drive greater efficiency. Audit your mobile landing pages and improve page speed and ease of navigation. The better the experience, the greater your conversions and AOV.
Invest in High-Quality Images: Invest in high quality images that support the growing Showcase Shopping ad format. Showcase Shopping ads require several lifestyle images, as opposed to standard product images, and the ad format empowers retailers to reach shoppers earlier in their shopping journey. Google is also investing in more visual ad formats, including Gallery Ads and Discovery Ads—both top-of-funnel marketing tactics—meaning lifestyle images will only grow in importance. These ad formats are still in beta, but they are expected to be generally available for retailers in the coming months.
Don’t Forget About Paid Search: Google paid search saw higher year-over-year growth in spend than Google Shopping. Additionally, Google paid search drove more revenue than Google Shopping for house and home retailers. That is why it is critical to innovate on this marketing channel, applying best practices such as ad extensions, audience targeting, and tailored ad copy. Fund paid search efforts appropriately in 2019.
Prepare for Lengthy Buying Cycles: Shoppers don’t make impulse purchases for high-priced items like furniture. These types of purchases require careful consideration, which means non-brand research queries are important terms to target. Monitor search query reports and track click paths for converting customers. These tools will indicate what non-brand queries are surfacing your ads and demonstrate how those searches lead to purchases later on. Consider looking at different attribution models to understand how non-brand queries perform through the lens of first click, time decay, or linear attribution models. It may reveal that these keywords are actually driving greater revenue than last click attribution suggests.
Stand Out on the SERP: With fewer paid search ads appearing above the fold, particularly on mobile screens, you must find new ways to stand out on the SERP. Use Merchant Center Promotions and ad copy to highlight sales, lifetime warranties, or free shipping. Ad extensions that share store locations will drive greater ad engagement and foot traffic to your stores.
Leverage the Physical Store: Make the most of your physical stores with Local Inventory Ads (LIAs). If a person is searching on mobile for an item you sell, and the shopper is close to your store, LIAs can target that individual and drive additional foot traffic. The closer the shopper is, the higher you can set the bid adjustment. Many house and home shoppers want to see and touch your highest priced products in person before they buy, making LIAs a powerful way to increase revenue and AOV.
Upsell And Cross-Sell: House and home retailers have abundant opportunities cross-sell and upsell their products. Feature complementary products on landing pages or other products shoppers purchased with that item. This provides a better user experience to the shopper and also increases cart size and AOV.
Must Reads for House & Home Retailers
For more Google Ads tips and strategies, check out the following articles:
Setting Up a Mobile Google Shopping Campaign for Maximum ROI
Google Gets More Visual & Aspirational With Gallery Ads & Discovery Ads
It’s Easy to Misuse Google Audience Targeting. Here’s How to Get It Right.
Deciding Which Attribution Model Is Right for Your Retail Business? We Have a Cheat Sheet for That.