Google Shopping Ads: Beyond ROAS to Real Profit

If you sell physical products online, Google Shopping Ads are the most profitable ad format available. Not because they look pretty, but because they let you compete on the only two things that matter in ecommerce: intent and economics. This guide breaks down how Shopping actually works, how to set it up properly, and how to optimise it for real profit instead of vanity metrics.

What Are Google Shopping Ads?

Google Shopping Ads (also known as Google Product Ads or Product Listing Ads) are visual placements that show your product image, price, title and brand directly in Google’s search results.

Instead of bidding on keywords like “running shoes”, you feed Google your product data, and Google matches your products to relevant searches. Done right, this gives you cheaper clicks, higher intent and stronger returns compared to SaaS-style Search campaigns.

How Google Shopping Ads Work

Google pulls data from your product feed in Google Merchant Center (price, title, image, GTIN, availability etc).

Then:

1. The user searches for something relevant.

2. Google evaluates which products match best.

3. Ads appear based on product attributes and bidding.

4. You pay when someone clicks.

No ad text. No creative. Performance is driven almost entirely by feed quality, campaign structure and bidding.

Why Google Shopping Ads Drive More Profit Than Search Ads

Most brands discover the same thing the hard way: Search ads get clicks but Shopping ads drive revenue.

Here’s why:

• Shopping captures purchase intent earlier. Shoppers see your price before clicking, filtering out tyre-kickers.

• Higher CTR at lower CPC. Images outperform text.

• Better visibility across the funnel. Your products appear in standard search, Shopping compare panels and free listings.

• More control when campaigns are structured by SKU profitability. You decide which products scale and which ones stop burning cash.

Search ads are great for capturing brand demand. Shopping ads create it.

How to Set Up Google Shopping Ads

Create Your Google Merchant Center Account

Your Merchant Center stores all product data.You’ll need to:

• Verify your website.

• Add shipping and returns policies.

• Connect your ecommerce platform (Shopify, WooCommerce etc.).

• Upload your product feed.

Build Your Product Feed

Your feed is everything. It determines:

• When you appear.

• What you appear for.

• How much you pay per click.

• Whether Google trusts your data.

Essential attributes include:

• title

• description

• price

• image_link

• availability

• product_type

• GTIN / MPN

Brands using poor feeds often blame Google for results Google never had a chance to improve.

Structure Your Campaign for Profit

Forget “one campaign for everything.”

A profit-first Shopping structure should:

• Segment products by margin, price point, or POAS tiers.

• Allow budget weighting.

• Give poor performers a place to sit without burning money.

• Let top performers scale without dragging dead products with them.

The old way: campaign structure for control.The new way: campaign structure for profit.

Google Shopping Ads Optimization Strategies That Increase Profit

Track Profit Metrics Beyond ROAS

ROAS is a misleading scoreboard. It only measures revenue, not the cost of goods, operations or fulfilment.

Instead, track:

• Gross profit

• Contribution margin

• Profit on ad spend (POAS)

• SKU-level margins

• Incrementality

You can’t scale revenue. You can scale profit.

Structure Campaigns by Profit Margin

Break your catalogue into:

• High-margin (scale aggressively)

• Mid-margin (maintain efficiency)

• Low-margin (protect the budget)

Give each a different bid strategy and spend cap. Don’t let a low-margin SKU eat the budget of something profitable.

Optimise Product Feed for Conversion

Strong Shopping campaigns start with strong data.

Focus on:

• 150-character product titles built around keyword relevance.

• High-quality images that beat your competitors’ thumbnails.

• Accurate product types for better query matching.

• Promotions and product ratings to increase CTR.

Feed optimisation compounds over time.

Use Negative Keywords to Eliminate Waste

Performance Max removed native negative keywords, but you can still apply account-level negatives via account settings.

Use them to block:

• Irrelevant searches

• Low-intent queries

• Brand-free competitor traffic

• Bargain hunters when your price is premium

Waste is where profit leaks first.

Test Bidding Strategies Based on Contribution Margin

Smart Bidding works best when fed margin data, not revenue.

Test:

• Maximise conversion value

• Maximise conversion value with tROAS

• Custom rules based on SKU tiers

• Hour/day-parting layered around contribution margin trends

Every bidding strategy is wrong for someone. Test to find your model.

Common Google Shopping Ads Mistakes That Kill Profitability

Most ecommerce brands lose money not because Shopping “doesn’t work”, but because of these avoidable errors:

• Using generic product titles that fail to match high-intent queries

• Letting low-margin SKUs dominate the budget

• Trusting Smart Bidding too early without data

• Never sending Google accurate profit or margin signals

• Running a single Performance Max campaign for the entire catalogue

• Not fixing product disapprovals or missing attributes

• Never checking the search terms report

Profit is built on discipline, not guesswork.

Frequently Asked Questions

How much do Google Shopping Ads cost?

You don’t pay to appear. You pay when someone clicks. Typical CPC ranges from £0.20 to £1.50, depending on your category, competition and feed strength.

What’s the difference between Google Shopping Ads and Performance Max?

Performance Max uses Shopping inventory but adds Search, Display, YouTube and Discovery. Shopping-only campaigns give you control. Performance Max gives you scale.Both work when understood. Both waste money when rushed.

How long does it take to see results from Google Shopping Ads?

Most brands see early traction within 7–14 days, with stable performance after 4–6 weeks once Smart Bidding adjusts to profit signals.

Turn Google Shopping Ads Into a Profit Engine

Google Shopping Ads are the most powerful revenue driver for ecommerce brands when they're built around proper feed structure, margin-based campaign design and a clear profit model.

If you want Shopping ads that go beyond ROAS and actually scale profit, JudeLuxe specialises in building POAS-first campaigns for brands ready to grow sustainably.

Your catalogue already has hidden winners. It’s time to unlock them.