PPC

Google Shopping Ads: Setup and Optimisation Guide

23 March 2026 7 min read

Google Shopping Ads put your products directly in front of buyers with images, prices, and reviews — right at the moment they are searching. For e-commerce businesses, Shopping Ads consistently deliver some of the highest return on ad spend (ROAS) of any Google Ads format. But getting there requires proper setup, a well-optimised product feed, and smart bidding. This guide covers the full process from Merchant Centre setup to advanced optimisation.

Setting Up Google Merchant Centre

Google Merchant Centre is where your product data lives. Every Shopping Ad starts here, so getting it right is essential.

Account Setup Checklist

Create a Merchant Centre account and verify your website
Set your business information, including shipping and tax settings
Link your Google Ads account to Merchant Centre
Configure your return policy (now a factor in ad placement)
Enable automatic item updates to catch price and availability changes

Merchant Centre Next

In 2026, Google has fully transitioned to Merchant Centre Next, which streamlines the interface and adds features like automatic product detection from your website. If you are still on the classic version, migration is now mandatory. The new interface provides better diagnostics, clearer product status reporting, and integrated performance insights.

Product Feed Optimisation

Your product feed is the single most important factor in Shopping Ads performance. The quality of your feed data directly determines which searches your products appear for and how they are displayed.

Essential Feed Attributes

Title: Include brand, product type, key attributes (colour, size, material). Front-load the most important terms. "Nike Air Max 90 Men's Running Shoes Black Size 10" outperforms "Running Shoes."
Description: Detailed product descriptions with relevant keywords. Google uses this to match products to searches.
Google Product Category: Use the most specific category available. "Apparel > Shoes > Athletic Shoes > Running Shoes" gives Google better matching context.
Product Type: Your own category hierarchy. This attribute is invaluable for campaign segmentation.
GTIN/MPN: Include wherever possible. Products with GTINs receive priority in auctions.
Images: High-quality, white-background product images. Avoid watermarks, promotional text, or cluttered backgrounds.

Pro Tip: Optimise your product titles the same way you would optimise ad headlines. Include the search terms your customers actually use, not just your internal product names. If customers search for "wireless noise-cancelling headphones," your title should include those exact terms — not just your model number.

Feed Management and Supplemental Feeds

Your primary feed comes from your e-commerce platform (Shopify, WooCommerce, etc.). Supplemental feeds let you override or add data without changing your primary feed — perfect for optimisation without affecting your website.

Uses for Supplemental Feeds

Custom labels: Add performance-based labels (bestseller, high margin, clearance) for campaign segmentation
Title optimisation: Override platform-generated titles with search-optimised versions
Promotional pricing: Add sale prices without modifying your main feed
Category corrections: Fix incorrect Google product categories in bulk

For Shopify stores, the native Google channel app provides a solid primary feed. Use a supplemental feed via Google Sheets for the optimisations above. Learn more about optimising your Shopify store in our Shopify builds service page.

Custom Labels Strategy

Custom labels are free-form attributes (custom_label_0 through custom_label_4) that you can use to segment products in Google Ads. This is where strategic thinking meets Shopping Ads management.

Recommended Custom Label Framework

Custom Label 0 — Margin: High, Medium, Low
Custom Label 1 — Performance: Bestseller, Average, Underperformer
Custom Label 2 — Season: Spring/Summer, Autumn/Winter, Evergreen
Custom Label 3 — Price Band: Under £25, £25-£75, £75-£150, Over £150
Custom Label 4 — Lifecycle: New Arrival, Core Range, Clearance

These labels allow you to create separate campaigns or ad groups for high-margin bestsellers versus low-margin clearance items, applying different bidding strategies and budgets to each.

Bidding Strategies for Shopping Ads

Shopping Ads bidding has evolved significantly with Smart Bidding. Here is when to use each approach:

Manual CPC

Useful for new accounts or products without conversion history. Set bids at the product group level based on margin and competition. Transition to Smart Bidding once you have 30+ conversions per month.

Target ROAS

The ideal Smart Bidding strategy for established Shopping campaigns. Set your target return on ad spend based on product margins. A product with 50% margins can sustain a 400% ROAS target, while a product with 20% margins needs 600%+.

Maximise Conversion Value

Useful when you want to maximise revenue within a fixed budget without setting a specific ROAS target. Good for scaling phases where you are willing to accept variable returns. For a deeper comparison, see our Smart Bidding strategies guide.

Standard Shopping vs Performance Max

In 2026, most Google Shopping traffic runs through Performance Max campaigns. However, Standard Shopping campaigns still have their place:

Standard Shopping: Better control over search terms, bid adjustments, and product group segmentation. Ideal for accounts that prioritise granular control.
Performance Max: Broader reach across Google's network (Search, Display, YouTube, Discover). Ideal for accounts seeking maximum volume with automated optimisation.

Many successful accounts run both — using Standard Shopping for core products with proven performance and Performance Max for broader discovery and new product launches.

Feed Diagnostics and Troubleshooting

Merchant Centre provides diagnostic reports that flag issues with your product data. Common issues include:

Disapproved products: Missing required attributes, policy violations, or landing page mismatches
Limited performance: Low-quality images, missing GTINs, or incomplete descriptions
Price mismatches: Feed price not matching website price (enable automatic item updates to fix)
Inventory issues: Out-of-stock products still showing in feed

Check diagnostics weekly and address disapprovals immediately — every disapproved product is lost revenue.

Frequently Asked Questions

How much does it cost to run Google Shopping Ads?

Google Shopping Ads use the same auction system as search ads — you only pay when someone clicks. Average CPCs vary by industry but typically range from £0.20 to £1.50 for most e-commerce categories. The key is not what you spend per click but what return you get. A well-optimised Shopping campaign should deliver a 400-800% ROAS for most product categories.

Do I need a Shopify store to run Google Shopping Ads?

No. Google Shopping Ads work with any e-commerce platform that can generate a product feed, including WooCommerce, Magento, BigCommerce, and custom platforms. Shopify has the most streamlined integration through its Google channel app, but the results are platform-agnostic.

How long does it take for Shopping Ads to start performing?

After initial setup, products typically go through a review period of 1-3 business days. Once approved, expect 2-4 weeks of learning as the algorithm gathers performance data. Smart Bidding usually stabilises after 30+ conversions. Budget enough for this learning period without making major changes.

Can I control which search terms trigger my Shopping Ads?

You cannot add positive keywords to Shopping campaigns, but you can use negative keywords to block irrelevant searches. Your product feed titles and descriptions determine which queries your products match. Optimising feed titles is the most effective way to influence which searches trigger your Shopping Ads.

Google Shopping Ads are a revenue engine for e-commerce businesses when set up and optimised properly. If you need help with feed optimisation, campaign structure, or scaling your Shopping Ads profitably, get in touch with Spires Digital or book a free strategy call via Calendly — we specialise in helping e-commerce brands grow through paid search.