Proven Strategy To Convert Your Highest Margin Products With Google Ads

[00:00:11] John: Hey everyone. Regina here with Solutions eight and Starter ppp. C. I wanted to show you guys a new strategy that we've been working with for maybe about two months, and it's proving to have quite a bit of success. came about because we were working with a client who had a lot of products and a small amount of budget.

[00:00:29] John: I'm talking under $5,000. And like, a feed full of products, a hundred products, maybe a thousand for example, we can go and look together. so if you're working with, a lot of products and a small amount of budget. This strategy is for you and because I manage a team here.

[00:00:46] John: I'm the head of starter Ppp C We're always working with small budgets, right? Because starter Ppp C we work with anyone who has a budget that is $5,000 or less. we. Often end up working with e-commerce companies that have 500, a thousand, maybe even 2000 or 3000 products. And what happens is the algorithm kind of focuses in on a couple of the products.

[00:01:10] John: And we think that happens because it kind of, you spends some money here, some money there, sees that one of them converts, and then it kinda leans into that sku, whether that SKU ever converts again or not. It has kind of like become familiar with that product and it's not willing to experiment on its own right.

[00:01:30] John: It tries to optimize. Optimization means it finds something that it knows, it learns about that product. It learns where to sell it, how to sell it, when to sell it, who to sell it to, what placement to put it in, et cetera. And then it tries to get you the best return for your dollar on that product.

[00:01:44] John: what if. You think that selling another product would be better? Now, you might have a lot of reasons for this, right? You might say, well, I have all these products over here with a really high profit margin, and when they sell, I make double the dollars that I make when I sell these products over here.

[00:02:00] John: So I really wish algorithm would focus on these products, right? it could be an inventory thing. Maybe it's like, oh my gosh, I have so many products from last season. I really have to get rid of them. I just wanna push them. See what I can get for it, there are quite a lot of reasons actually that you might wanna lean into another product.

[00:02:16] John: It could also be a strategic move. Maybe you're thinking to yourself, well, the way my products work is I have these products that are kind of introductory level products, but then I'd like to upsell people to these products. So I just know that these are the products that are gonna bring people in.

[00:02:31] John: I want the algorithm to focus on these, but right now it's trying to sell these. products that people aren't looking for. Those are upsell products. sometimes it's structured like that. Sometimes it's actually the opposite, right? Sometimes you're like, I really wanna lean into these upsell products, right?

[00:02:44] John: These are the high priced products. I would really like to find people that are gonna buy these because these tend to sell to more high end clients. And not only do I make more on each sale, but I also get more high end. Not clients, but customers who then end up buying two or three things or it increases my lifetime value.

[00:03:02] John: So there's a lot of reasons why you might choose to try to get the algorithm to lean into some products that it's currently not leaning into. Okay. All of that, because I wanted to show you this strategy that we came up with

[00:03:15] John: in the past. Whenever we wanted to lean into some products, it was tough because we used to try to split the shopping campaign into two, which when you get into higher budgets, that's entirely possible, right? Because you have like a big shopping budget, you can split your campaigns into two or three or seven, and you can manipulate the, the budgets between campaigns when your very budget restricted and your daily spend is barely enough to get like three to five clicks a day or something like that.

[00:03:42] John: You don't wanna split your budgets because when the algorithm doesn't have enough daily spend to get a frequency of conversions in each campaign it struggles. it gets a conversion. It waits a month, It loses track of who's been looking, who's in the market, where, the data that it got from that one conversion weeks ago got old.

[00:04:03] John: So it just becomes really difficult to get anything to sort of build momentum when you're really budget restricted. So I don't recommend splitting into two campaigns. what I do recommend is this. What we've done in this account is we've set up a standard shopping campaign. Now, you might say, oh, wait, but what about pax?

[00:04:20] John: You can run Pax side by side with standard shopping and that's for a whole nother video on a whole nother day. But sometimes standard shopping can feed Pax and that's actually something we're considering doing someday in this account when we have a little more budget. Right now we didn't wanna have two shopping campaigns again.

[00:04:37] John: as you can see, there's only $60 a day in here. We don't wanna go any lower than $60 a day. These are relatively expensive products. the average is only a dollar 24, but still, we don't feel the need to set up pmax side by side with standard shopping.

[00:04:49] John: Now for this strategy, you have to use standard shopping, and it's because Pmax doesn't have the ability to do what I'm about to show you. So I went into the standard shopping campaign, and I'm gonna click over to Ad Groups. what you can see here is we've split the campaigns down the middle into two ad groups.

[00:05:04] John: One is the ones that are the highest profit margin and one that is the lowest profit margin products. Right? So just split them into two ad groups down the middle. You can do this by adding like a custom label. In the feed. So we have custom label A, custom label B. What this allows us to do is it allows us to manipulate the bidding strategy separate on one category versus the other in order to try to focus the algorithm in one direction.

[00:05:30] John: So you can see here that the high profit margins have a target roaz of only 20%, and the low profit margin products have. Target roaz. That is double. Okay. Now, it doesn't really matter what these numbers are. You could set these to 80 and 160. You could set them even higher if you want. Although we have found that setting a low target roaz in standard shopping can be really beneficial.

[00:05:56] John: If you make it too restrictive, right? The higher the target row is, the more restricted the campaign is for example, let's say you say, I want a 300% Roaz. So you set your trigger as to 300. Well, now the algorithm can't do anything unless it thinks it's gonna get a three x return. That might work for a few days and then the algorithm might say, oh no, I'm not able to get this three x return.

[00:06:18] John: So what often happens is it stops spending or it just starts ignoring your target RO as goal, which. Don't ask me. I don't know why the algorithm does that. I would wish that it would just restrict the spend if it can't get you a three x return, but, Google wants money. So what we do is we set a low target roas, but we're setting one that's less restrictive in the high profit margin because we want the algorithm to be free to spend more in there.

[00:06:42] John: Now you might say, well, wait a second. The second I start spending more money In one ad group with. All my more expensive products aren't, isn't my ro, isn't my Ros gonna go down in the account, right? Like, aren't I gonna get a lower return? Because this ad group is full of all the competitive products, all the ones that are high priced they cost a lot per click.

[00:07:03] John: The conversion rate is lower, so I'm gonna get a lower return on these ones. this is true, at least temporarily, right? So this is a strategy to manipulate the algorithm's focus and get it to familiarize itself with your favorite products over the long term. I don't think it's going to bring you instant success with roas, right?

[00:07:23] John: Anytime you're shifting the algorithms focused to new stuff that it's unfamiliar with. You're gonna temporarily lower the roas, so I don't recommend doing this in an extreme way. For example, if you're setting this up, just set up. You know, 30% here, 30% here, and then slowly lower it by 5% each week until you get it to where you want it to be.

[00:07:42] John: That type of thing. But what you can see the results that we're getting here, we've been running this since mid-November actually, and slowly manipulating the bids. Over time and time, more and more and more budget is spent on these high profit margin products. We're not making a hard cut and saying, Hey, algorithm, you can't spend money on the low margin products.

[00:08:00] John: Right? Because that's restrictive. That takes the budget and splits it in half. Instead, what we're doing is we're saying you can do whatever you want, but you need to get us. Double the return over here if you're gonna spend money. And sure enough, it is getting a higher return, the lower profit margin, we've told it to get a higher return.

[00:08:18] John: It's gotta spend less money doing that, but it is gonna get a higher return over here. It's gonna spend more money and it's gonna get a lower return. Don't let this sway you, right? Don't let the roaz between the two ad groups sway you. If you wanna sell these products because you know it's better for your bottom line in your business, do that.

[00:08:35] John: If you're spending 10 K here, of course the roaz is gonna be lower than if you're spending $2,000 here. You're gonna have a higher roas. Surprisingly, it's not double, right? the lower profit margin has a target ROAS that's double, and it's spent less than half of the higher profit margins, and yet it's not getting double the roas.

[00:08:56] John: So clearly it can't, this grouping of products can't take as much money as this grouping of products and still be profitable.

[00:09:03] John: I think I've just about covered everything. So again, this is a long-term strategy. sometimes you have to kind of slowly manipulate the algorithm over time and cross your fingers that two months from now you're going to be able to Create a healthy algorithm rather than focusing on, oh my God, I need that high return tomorrow, right?

[00:09:24] John: Because if you're always trying to chase that high return tomorrow, you're just gonna set a target row as that's high and guess what? Your algorithm's gonna atrophy. So you have to let it learn. Set those low target row as goals in your smart in your standard shopping campaign. You have to. Slowly manipulate it over time with bids rather than pushing budget into these products or pushing budget into those products.

[00:09:45] John: this is a strategy that has worked for us. Give it a try. Hope it works for you. if you are working with budgets that are less than 5k check out starter ppc.com. The link is in the description below. We'll run ads for almost anyone, almost any type of business. And we have a very affordable monthly rate that I think is less than half wet solutions, eight charges.

[00:10:05] John: And yet we still work on the Solutions eight team. We're all the same people we work together. The difference is that Ater pbc, we don't do any meetings. So we will send you videos, we will communicate with you via support ticket but there's no meetings and that's how we can keep it affordable for entry level business owners.

[00:10:22] John: So check us out. Hope to work with you soon. Thanks.

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