The share of product listing ad (PLA) impressions compared with standard text ads grew 60% from September through December 2012. Since then, impressions fell 2% in June and 13% in July compared with January 2013, according to a report.
"It seems we reached a threshold, where Google doesn't have enough related ads to serve in a specific product category," said Kye Mou, senior product marketing manager at Marin Software.
Mou attributes the dip during the past two months to Google Enhanced Campaigns, as well as some changes in requirements for PLA product feeds. During the next three months, as more retailers start using PLAs, and as product-related searches grow heading into the holiday season, Marin predicts the share of PLA impressions to standard text ads will increase.
Marin plans to release the findings from its annual 2013 report "Google Shopping Ads: Product Listing Ads Deliver for Retailers" this week to help marketers prepare for the holiday season. But as competition increases, so will the cost per click. In fact, recently CPCs have risen faster than the rate for text ads, although they still remain lower.
Mou said the research shows that PLAs not only perform better, but that clicks remain far less than for standard text ads -- about 90% less.
Yet they continue to rise at a faster rate compared with text ads. In July 2013, PLA CPCs rose 53% year-over-year, while standard text ads increased 10%. CPCs rose 34% compared with January 2013 to an all-time high in June. Although CPCs dipped in July, possibly as a result of seasonality, Marin's study attributes the rise year-on-year to more competition in the media.
The share of PLA click-through rates to standard text ads rose 3% from January to July 2013. Optimizing product feeds, mobile targeting, and consumers becoming more familiar with the format continues to support an increase in CTRs. In fact, CTRs remain higher than standard text ads since November 2012, reaching a high of 21% in June and July 2013. In July, PLA CTRs rose 19% year-over-year, increasing each month since February. Marin expects CTRs to increase during the holidays as shoppers become more comfortable with the format.
Since Marin took a sample of its Global Online Advertising Index, those advertisers and agencies spending more than $100,000 monthly on paid search, data and findings skew toward the performance of larger retailers and may not reflect the trends of small ones. The company believes that the size of the data set and geographic reach enables it to provide a comprehensive report on the changes in PLAs.