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Product IQ: The missing part in most PPC campaigns : E-COMMERCE MARKETING

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Good knowledge of Google Ads doesn’t mean that you can run and scale profitable campaigns.

That may sound strange. But it is true. And the reason I know that is that I’ve failed many times.

Sometimes it was because the company wasn’t ready to run ads, sometimes it was because I was missing something in another area.

This article is about the last part.

Because your products come first in e-commerce.

If you know more about them and use this knowledge, something will be added to your campaigns that I call “Product IQ”.

It took a couple of years, but when I realized how powerful that was, I paid close attention to it.

In this article, I’ll show you what Product IQ is and how you can get better results.

What is product IQ?

Product IQ: Use product knowledge to control your marketing efforts

To operate a company most effectively, you need to understand how it works.

Which products drive sales? Which products drive initial purchases? Which product catalog can you use to reorder?

Take, for example, Best Buy, which often has promotions that sell products at cost.

best-buy black-friday-2019-tv-promo
Best Buy Black Friday promotions for low margin products

If you buy one of these TVs, they are unlikely to make a profit. But they make up for it by selling you extra cables and / or an extended warranty.

So if you’ve focused your Google Ads campaigns on maximum profitability, don’t put a budget on a product that literally has no profit margin.

However, if you take a step back and look at the overall strategy, it makes sense to advertise these products vigorously. They lure buyers with a loss leader and then sell higher margin products.

With this example, I don’t want to convince you to sell products at cost price. I would like to illustrate how it can lead to results if you get more clarity about the products in your catalog and intend to promote them.

Why should you care?

Without Product IQ, every product is considered the same and Google Ads campaigns are optimized based on metrics such as click rate and conversions.

If you’re the business owner and you’re running your own campaigns, you’ll have a great understanding of which products you want to sell more of.

However, if your ads are showing by a freelancer, consultant, or agency, the focus is on driving traffic and sales without considering the products. It is obvious why this is happening, and it takes time and intent to find out these things.

However, the truth is that most companies don’t want traffic, but the revenue associated with that traffic.

So when you run Google Ads for a customer, adding Product IQ to your toolbox can make your customers happier.

First, let me show you a case study of how Product IQ is applied to my customers’ campaigns.

Add Product IQ (client case study)

First a small background about the business I worked with: Established e-commerce operation (> 5 years), high 6-digit sales figures in e-commerce, solid regular or regular customers, strong organic presence, a bit of e- Mail marketing and Google Ads campaigns ran on autopilot.

They brought me in to help me with this last part because they thought their Google Ads campaigns were underperforming.

They had over 2,000 products. When we worked together, I knew I had to improve my Product IQ. So I asked them about their purchase dates:

  1. How much did the individual brands, products and categories sell?
  2. What did their edges look like?

(In the next section, I outline the exact reports to ask and search for.)

I used these reports along with keyword research and revised some of the campaigns that I expected to perform well.

The implementation of these campaigns and the optimization with the additional product information led to an increase in sales of 10%, a constant ROAS and a profit jump of 25% in the two months of cooperation.

case-study-product-iq

In addition to running these campaigns, there were also some collective campaigns. The aim was to generate additional traffic and to find other interesting objects.

When I saw that products and brands were doing well in these campaigns, I pulled them into their own campaigns and started putting more budget behind them.

This led to an increase in sales in a category that didn’t have much to offer before. Today it’s the strongest category, responsible for about a third of all Google Ads earnings!

product-iq-case-study-new-category

The reason for this blind spot is that this particular category did not have a strong organic ranking. Since these products and category pages ranked on pages 2-3, not many sales were made despite solid prices.

Read on to find out exactly how you can do this for the campaigns you manage.

Apply Product IQ to your campaigns

It is clear that there is a big gap between total ignorance about a product category and an intuitive feeling when you sell the right things.

There are a lot of different systems and reports that you can collect and analyze. But initially, not all of this information is essential.

For this reason, I divided it into different phases. Read the entire article, but implement it step by step. This prevents you from getting stuck with lots of different spreadsheets without having any idea how to deal with them.

Phase 1: focus on what works

This first phase is pretty easy. You find out what worked and you try to do more of it.

You have several sources to get this information.

Data source 1: e-commerce backend

These reports vary depending on the system used and the data available in it. Good reports are the ones that break down sales, units sold, and profit by brand and product.

Here is an example of such a report:

A report like the one above gives you a pretty good idea of ​​what’s selling well. The disadvantage of most of these exports is that they lack the source of the sale.

We can provide an answer for this with Google Analytics

Data source 2: Google Analytics Enhanced E-Commerce

Here is the product performance report, broken down by source / medium:

google-analytics-enahnced-ecommerce product performance report

You can find this report in your own Google Analytics account: Conversions> E-Commerce> Product Performance. Then add “Source / Medium” as a secondary dimension.

This is not particularly useful in Google Analytics, so I usually export it to Google Sheets.

There it is easier to drill down, add additional columns or do some calculations.

For example, here are the products that sell well at Bing Ads:

Product performance by channel

Two comments on working with such reports:

  • Period: Subtract these reports for at least the past 3 months or even a year
  • Identify seasonality: Do not assume that the data from the past 3 months are representative of the entire year. If you are not sure, it is best to ask your customer or a colleague.

Now that you have a lot of data, let’s see what we can do with it.

First, you get a feel for what’s generally selling well:

  • Top products by sales – overall
  • Top products by units sold – overall

Next, take a look at these reports and find out what’s organic with your advertising campaigns and what sells well with your advertising campaigns.

A product that sells organically well has a good chance of selling well with the right campaigns.

However, there are exceptions. With SEO, you don’t always know which searches increase sales. So if you get a very good organic placement for a brand keyword and include that product in a Google Shopping campaign, it could trigger a lot of generic searches and generate no sales.

The reason why I mainly deal with organic and paid searches is that other channels are a little more difficult to compare. A referral link that sends traffic can result in many targeted sales of a particular product. Trying to drive traffic to this product in your campaigns can cause problems.

Depending on what you spend on each channel, it may be helpful to take a closer look at the difference between Google Ads and Bing Ads.

If you’re using Google Shopping, custom labels are key to adding this product IQ to your product feed.

Level 1 Goals:

  1. Understand which products generate the most revenue / profits / sales (think 80/20)
  2. Focus most of your budget on search and purchase campaigns that promote these products

Level 2: Find hidden potential

At this stage, you’re trying to figure out what’s missing from the reports you saw in the first stage.

To do that, you need a little more insight. Again, when you work with a customer or team, it is very valuable to speak to them. (This also gives you a lot of appreciation because few outsiders bother to get to know their business.)

Data source 1: customer or team

These are the things you want to know:

  • Breakdown of margins by brand / brand + category / brand + product
  • What used to sell well, but not anymore?
  • Which products are selling below expectations?

The goal is for them to share some of their product knowledge with you.

Data source 2: suppliers

Another important source of knowledge can be a supplier or a wholesaler.

With a customer I worked with, one of their suppliers ranked the products and how well they sold:

Supplier Top Products

The same wholesaler also told us how many units an “unnamed competitor” sold.

This was absolute gold as it helped uncover hidden potential.

Because once we knew what volumes a competitor was selling and what products, we started replicating those volumes.

It was a little scary at first because we spent quite a bit on products that hadn’t produced much for us in the past. Equipped with the knowledge that a competitor got it going, we invested more and more budget and optimized the campaigns.

After a few weeks, we noticed a significant increase in sales that we would have missed if we hadn’t had this information. We just had to ask.

If you don’t have access to a team or a helpful provider, there are other options.

Data source 3: Catch-All campaigns from Google Ads

At this point, it is a good alternative to run a few collection campaigns for your product catalog. When shopping, they would have all the products that you didn’t split up into your own campaigns. In search, you can run dynamic search ad campaigns for the same products.

google-shopping-catch-all campaign

You keep your bids low and monitor which products do well. You increase them slightly, and if the trend continues, break them up into your own campaigns for full control.

Data source 4: Google Ads Auction Insights reports

Another great resource for finding interesting products that are even more important is the Auction Insights reports.

google-auction-insights-report

Find this report in your Google Ads account by switching to a campaign or ad group and clicking the “Auction Insights” tab to the right above the line chart.

This report lists the competitors who bid on the same keywords / products as you.

The main thing is to look for shifts in expenditure. If you see a competitor with a 30% search impression share that reaches 90% IS a month later, it may be worth investigating why this happens.

If your account is well organized, you can monitor these trends for specific categories, brands or products.

If you notice such a shift, check their websites to see if they have added new products or brands that may have increased spending.

Level 2 Goals:

  1. Find products that do not reach their potential
  2. Expose these products to more traffic

Level 3: Identify growth opportunities

In the first phase we used what already worked. In the second phase, we tried to get more out of the same product catalog.

In this phase, the goal is product expansion: identify new products or brands that might be interesting.

If you’ve been tasked with managing Google’s ads, procuring new products is a little out of your job responsibility.

However, this doesn’t mean that you can’t help make others do their jobs better, and you can take advantage of a better product catalog for your ads.

Data source 1: Google Ads Search Terms Report

When you manage Google Ads campaigns, you spend a lot of time investigating incoming searches.

Negative keywords report for Google ads
Look for interesting new products in the search term report

Typically, this is done to filter out bad matches and get ideas for further developing your campaigns.

Instead of always excluding search queries for products or brands that you don’t sell, you can consider them an ongoing tool for product research.

I often notice that new products or brands appear. I keep them in a list and occasionally share them with the customer to discuss.

They are not always relevant, but in some cases I helped launch a new brand or product that was a nice addition to their catalog.

Data source 2: website of your competitors

This is pretty easy. In the previous phase, you have a good idea of ​​which websites are competing with your ads.

Get to know your competitors’ product lines and find out which brands or products they offer.

See if you have a “New Arrivals” or “New Items” section. Or sign up for the newsletter to discover new additions to the catalog.

If you’re at Shopify, just add collection / all? Sort_by = bestseller behind the URL. This shows you the top products for this website. For example, here are the best-selling products from Ugmonk:

Shopify-hack-find-best-selling products
Find the best-selling products in shops hosted by Shopify

Product IQ beyond Google Ads

Product IQ aims to make you a more effective ecommerce advertiser. However, these findings can be used far beyond Google Ads.

Finally, I would like to give you some ideas that you can pursue or share with your customers

In website design

Once you’ve figured out which products matter most, it’s time to take another look at your website.

Use these questions to trigger some thoughts:

  • What products do you have on your homepage? On your category pages?
  • Which products do you promote with related products?

It is difficult to keep an eye on the effectiveness of all these little things.

But if you know that product A sells twice as many units as product B, why not push the former?

I recently came across this example from a shaving company Deliver, They tested where they linked the hero button on their homepage.

supply-homepage-test
Homepage of Supply.co

Instead of referring to their starting sentence, they started testing a few alternatives:

Supply-Google Optimize experiment

The test is not yet complete, but this kind of experiment can lead to low profits.

On landing pages

If you’re targeting general traffic, you can send those visitors to your category pages

Another option is to create landing pages for specific searches that really add value.

You could highlight your cheapest product or the most popular products.

A good example of this is the following Best Buy target / category page if you are looking for “best electric toothbrush”.

landing-pages-ecommerce
Example of a content-rich category page from Best Buy

The more you know which products perform better, the more effectively you can design such a page.

In email marketing

Another HUGE topic is how you can use your product IQ with email marketing.

The simplest question of that is: Which products do you feature in your newsletter?

Think about the companies that used to send out these huge catalogs in the mail. They would spend a ton of money sending them out. So every product had to prove its value in the tests running up to the big push.

You probably don’t have the time (or data) to go over every part of your email. But just being a bit more thoughtful might go a long way.

If your store has been around for a while, there are a ton of additional things you can discover.

For example:

  • Which products to first-time buyers purchase?
  • Which products sell well with repeat customers?

Is there anything you can do to influence this?

These are very interesting dynamics to discover that can pay huge dividends.

If you want to dive deeper into these, take a look at this advanced email marketing case study, It will make your head explode with ideas!

Using Product IQ

The goal of this article was to highlight the benefit of product knowledge in marketing.

By understanding what products to focus on, your efforts will be a little easier and investments will see a better return.

Becoming smarter about the products you are advertising doesn’t happen overnight. There are a couple of stages most advertisers go through:

  1. Strengthen the existing best-sellers
  2. Maximize the potential of the product catalog
  3. Product expansion for future growth

While this article focused on applying Product IQ to Google Ads, there are plenty of other ways to benefit from these insights.

Bonus: To help you apply the lessons in this article, I’ve put together a Product IQ worksheet. Click here to grab it!

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