AdWords provides retailers, agencies and marketers some very efficient ways to structure and manage Google Shopping campaigns. At the top level there are Product Groups which can be denominated by a number of different classifications such as Google Product Category, Product Type, Condition and/or Brand.
Many agencies utilize another classification known as Custom Labels to group specific sub-sets of products together. These beneficial, albeit often misunderstood and limited product groupings are unique as they are (as the name would suggest) custom-built by the user. All in all there are 5 total usable Custom Labels numbered 0-4 that can be used.
Whether you are using them now or are curious about using them in the future, we wanted to share a little bit of insight into both best-use practices and the distinct limitations behind Custom Labels.
First, What You May Not Know
There are some pretty crucial aspects of Custom Labels that you should keep in mind before you start making changes to your feed. Depending on the size and complexity of your product catalog, Custom Labels may simply not be the right choice for your Google Shopping campaigns.
0 Through 4: As we mentioned above, you only are able to take advantage of 5 unique Custom Labels for your campaigns. What you may not know is that for each Custom Label, only a total of 1000 unique ID’s can be included. So for retailers with over 5000 products and variants, Custom Labels as a broad strategy probably won’t work.
Label Definition: Custom Labels are again “user-defined.” In that case you can set individual definitions for each label. You are also able to have more than 1 Custom Label per product. This can cause some major issues if you are not careful when first subdividing campaigns and setting campaign priority levels. You could very well have the same product appear in two different groups, bid the same on each, or bid differently on each and compete with yourself for impressions and clicks.
Product Migration: This happens more than you’d think. Let’s say Product A has Custom Label 0 and after a few weeks or a month it no longer belongs in Custom Label 0, but instead something has changed (dynamically or manually) and now it belongs in Custom Label 4. First, there’s the matter of changing the details in your feed. Now if you don’t take proper advantage of multiple Labels in a product, guess what happens when that product now moves to an entirely new group. You wind up losing valuable historical data on that product and, now in the new Custom Label, the product has to start all over again from zero.
Many of the pitfalls when using Custom Labels simply revolve on proper use. When they are misused or misunderstood there are many problems retailers can run into. At the same time though, Custom Labels can be extremely powerful tools for scaling Shopping campaign management.
But, Custom Labels Can Be Awesome
Custom Labels provide a certain level of freedom to retailers and advertisers to be as creative as they want with their Google Shopping strategies. When combined with some more advanced subdivision techniques, Custom Labels can even enhance granularity and control of individual ID’s in AdWords.
Here are some of the top examples of how Custom Labels can be used to impact your management strategy.
- Best Sellers: Most retailers will agree that there are probably just a handful of products that are considered their top earners. Since the pool is often so small, Custom Labels are a great way to define these products. You may want to ensure increased exposure on these products and therefore having them grouped together will help in divvying out higher bids or adjusting bid modifiers differently in comparison to other products.
- Phone Orders: We see this more and more with retailers as time goes by, especially in very specific verticals such as machine parts and auto parts. Sometimes product ads convert outside of the cart and when there is a very specific subset of products that do so over the phone, you can possibly work these into a Custom Label strategy. With these products separated from the rest of the pack you can completely change how and when their associated ads appear according to device as well as match ad spend to phone sale values with a bit more ease.
- Unique Brands: Apparel and accessories retailers sometimes stock inventory on new, burgeoning, or very unique brands. Custom Labels can be a great way to test out how viable they are in the Shopping results. This becomes especially more important when you are dealing with very low brand recognition or brands that are normally only purchased by a small demographic. To better adjust for Impression Share and understand how higher bids affect broad search term analysis, using a Custom Label on these products may be a good idea.
Though these barely scratch the surface, we think they definitely provide a good start and an idea on how diverse the use of Custom Labels can be.
Proper use of them is always key though. For example early on in Google Shopping marketers would (and some still do) use Custom Labels to designate groups of products by Margin ranges. Though it has some value, we highly recommend not going this route. When a Custom Label/Margin combo strategy is used without taking proper measures to understand each product at the ID level it can lead to overspending on non-converting products.