Google Ads Price Market Metrics

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Since Google AdWords changed its name to Google Ads, presenting us with a completely different and updated interface, Google has not stopped introducing new features and improvements.

This year we have seen how Google Ads has shown new metrics that did not exist on the old platform. Today we’re going to talk about three new metrics:

  • Average product price

  • Benchmark product price

  • Benchmark product price difference

Average product price

This metric, as well as the majority of new funcionalities launched by Google Ads in 2019, is shown as a beta. The information provided by Google is so scarce that it provides only a small definition.

What is average product price?

The average product price is the average price of the product when it has been displayed in an auction.

What does it mean?

Imagine, in our ecommerce we are using a dynamic repricing system like netRivals to maximize our revenue and product X has suffered several price changes in the last 30 days. One day it had 20 impressions at a price of 50€, another day it had 10 impressions at a price of 54€ and we currently have it at a price of 52€. The average price of the product in this example will be 51.33€.

How to visualize this metric?

In order to see this metric in the platform we have to go to:
Google Ads Account > Google Shopping Campaigns > We select the campaign to which the product belongs > We click on the section Products > Columns > Modify columns > Shopping > Average price product.

To have more relevant information we recommend to show this column right next to price column to be able to compare the data

Benchmark product price

Another new metric with a high potential for optimizing a Google Shopping campaign is benchmark product price. This metric was presented as a beta but apparently has already gone into production.

What is benchmark product price?

The benchmark product price is the average weighted sales price of the product that has been impressed during the auctions. This sales price, unlike the average price of the product we discussed earlier, takes into account all advertisers who have shown the ad during the auctions.

Let’s imagine that we have the same product as in the previous case. Product X, which we sell at 52€. If we have competitor A, who has shown his ad in the auction 10 times setting the PVP at 53€; competitor B has shown his ad 9 times with a PVP of 56€ and we, who have shown our ad 1 time at 52€, the product price comparison will show 54.30€.

MerchantProduct PriceClicks (over last 7 days)
Merchant A100€9
Merchant B120€1
Merchant C125€0

Benchmark product price= (100€ x 9 + 120€ x 1 + 125€ x 0) ÷ 10 clicks= 102€

Benchmark product price differences

This metric is the one that provides us with the most visual and accurate information. If we have understood the previous metric this one will be very easy to comprehend.

Like the previous one, Google presented it as a beta but this annotation no longer appears.

What is Benchmark product price differences?

It is the difference, expressed in percentage, between our price and average market price (benchmark product price).

Continuing with the previous example, if we sell product X at 52€ and the price comparison of the product is 54.30€, the price difference between products will be -4.24%.

How can we use these metrics in order to optimise our Google Shopping Campaigns?

There are various strategies which are used in Google Shopping management campaigns, such as:

  • Structured campaigns by products in which we are very competitive, competitive and non-competitive to supply quality information to the Google Ads algorithm. In the products in which we have a better price we will obtain much higher ROAS than in those in which we do not have it.

  • Manual repricing:lower the prices of certain products to achieve the Google Shopping Buy Box and increase both visibility and the conversion rate.

  • Stop investing in products in which we are not competitive as they have a much lower conversion rate than competitive products.

How to scale up these strategies to get the most out of them?

With netRivals’ automatic monitoring tools and Dynamic Pricing application with this system you can aggregate as many competitors’ products as you need, view basic statistics such as price history, whether they are in stock, price relative to your products, etc.

Afterwards, you can set up pricing strategies to be more competitive than a particular competitor, while maintaining your profit margins.

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