Advertisers up spend on paid for Product Listing Ads on Google, study shows

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Paid for Product Listing Ads (PLAs) on Google have increased their share of total click searches since their launch in the US in October 2012, according to research by digital ad management platform provider Marin Software.

It found the click share of PLAs as a percentage of total search clicks increased 210% as consumers increased their engagement with the ads, which appear as image results in Google Search and as product listings within Google Shopping. 

According to Marin, Google Shopping’s switch to a commercial model appears to be paying off, and advertisers have increased their share of search budgets directed towards PLAs by nearly 600% in the last quarter of 2012. 

Marin said the findings are poised to have a significant impact on UK advertisers who will be able to take advantage of Google PLAs when they launch internationally on 13 February 2013.

Marin said its analysis shows PLAs ended 2012 with a higher click-through rate (CTR) than text ads, and an average cost which is lower than of traditional text ads. The combination of a higher CTR at a lower cost indicates favorable performance conditions for advertisers, it said. 

As a result, Marin expects marketers to continue growing their investment in the ad format over time.  

The company has also launched a PLA enhancement to its platform that enables marketers to create and edit PLA campaigns, optimise target bids to maximise revenue, and generate reports specific to PLA performance.  

“When Google announced their new enhanced shopping experience and the intent to transition shopping ads from organic results to paid, they took a risk that the move would alienate retailers,” said Matt Lawson, vice president of marketing and partnerships at Marin Software. 

“Google’s decision, however, appears to be paying off with increased user engagement and advertiser investment. During the fourth quarter of 2012, we saw some retailers allocate as much as 30% of their spend towards PLAs. Marin Software’s new PLA solution allows marketers to harness the power of the new ad format as advertisers seek to acquire revenue online.”