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Setting up Google Ads Bids by Product Price in Shopping Campaigns

Aug 25, 2023

The Problem of a Single Bid for All your Products

When you first start with Google Ads, it is quick and easy (and therefore very tempting) to set a single bid for all your products, but is it smart? Think about the questions below to see if it is a good idea or not for your store.

Does your catalog have high product variety, or just a single product type?
Do your products sell better in certain seasons (Fall, Winter, etc.), or there is no seasonality?
Does your catalog have best sellers and slow sellers, or do they all convert at the same rate?
Do your products have a wide product price/profit range, or are all the products about the same price/profit level?

If you sell a single product type, with no seasonality, and your products convert at the same rate and have about the same price/profit level, then a single bid for your entire Shopping Campaign would work well. Otherwise, it is a really bad idea, and you will lose a lot of money!

I have personally heard from countless sellers who have tried this approach and failed, myself included!

Never Spend more than your Profit on Clicks

The reason why a single bid does not work for all your products is simply because you do not want to spend more buying clicks for the product than you make in profit.

If a product provides you with $X profit, and it takes Y clicks to sell it, then by simple math, you should not spend more than $X ÷ Y per click. Examples:

You make $10 profit, and it takes 10 clicks to sell the item. $10 ÷ 10 clicks = $1 per click is what you can afford to pay at most.

If you make $1 profit, and it takes 100 clicks to sell the item, then $1 ÷ 100 clicks = $0.01 per click is the most you should pay.

If you paid $1 per click for the item in the second example, you would be spending $100 to make $1 in profit!

The next Easiest Bidding Strategy is to bid by Product Price

In Google Ads Shopping Campaigns, you can use Product Groups to sub-divide your product catalog and set diferent bids for different groups of products.

The next easiest bidding strategy is bidding by Product Price. Why? Because your product feed already has a product price for every item. Price is a mandatory field!

If you want to bid by any other aspect of the product, such as brand, product_type, profit margin, conversion rate, season, etc, it will require more effort to gather and enter this data into your product catalog.

Another reason why bidding by price is an easy and effective bidding strategy is because price provides a reasonably accurate approximation for profit margin (in absolute terms).

Free Calculator for Computing Maximum Bids for Google Ads Shopping Campaigns

Use the free calculator below to determine the maximum bids for different items in your store at different price points.

Adjust the sliders as needed to determine your bids. If you are not sure what your conversion rate is, a good rule of thumb is 1%. This calculator assumes you will spend all of the profit on clicks, so be sure to set the Profit Margin to the amount of your profit that you want to allocate to clicks.

(Absolute Profit: $5.00)
(Clicks per Sale: 100)

Privacy: This bid calculator is secure 🔒 and private 👁, and data never leaves your device. The calculations are done using in-browser JavaScript.

Set up Price Ranges in your Feed

Once you have set up some price ranges and associated bids, read How to Set Up a Feed & Shopping Campaign with Bids by Product Price for step-by-step instructions on how to configure the price ranges in your feed. This involves entering the price ranges into the custom_label field settings, clicking a button to resubmit the feed, and then configuring your Google Shopping campaign with product groups.

We are happy to configure your feed settings for you if you simply email us the price ranges you want set up.

Next Steps

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