We’ve just completed a significant case study on the top eCommerce marketing channel, Google Ads, to determine which Google campaign type has the best ROAS. And boy, do we have some fantastic data for you!
One of the biggest struggles eCommerce entrepreneurs face when laying out their marketing plans is where and how to allocate their advertising budgets, to ensure they are getting the best ROAS (return on advertising spend). Finding the optimum Google campaign type for your online store can take valuable tweaking time, and if not done correctly, can lead to costly mistakes.
To help alleviate some of the pressure and give you a massive head start in planning your 2020 eCommerce marketing strategies, we conducted a study of over 2,000 eCommerce merchants across Google’s top campaign types: Google Display, Search, Shopping and YouTube (video).
Newbie Tip: Not sure exactly what ROAS are or brand new to eCommerce KPIs in general? Here’s a beginner’s guide to the 9 Must-Track eCommerce KPIs to Ensure Google Ads Success and How to Work Them Out to get you caught up!
In this study, we break down the CTRs and conversion rates and values of these top Google campaigns over 2018 and 2019 and reveal which ad type has shown the most improvement in terms of ROAS: the campaign type that promises the most opportunities in 2020 for not only reaching your shoppers, but converting them. But first, let’s break down the data we used for our exclusive ROAS case study.
eCommerce ROAS Case Study Summary
In this ROAS case study, we analyzed the data of over 2,000 eCommerce merchants over the course of 2018 and 2019 to determine which Google channel showed the most improvement in terms of ROAS last year. Here’s a summary of data points:
- Case study sample size: 2,000+ eCommerce advertisers
- Campaign Types: Google Display, Search, Shopping and video
- Study time-frame: 1 January 2018 to 31 December 2019
We will now countdown channels to reveal the Google campaign type that offered the best ROAS growth in 2019.
Grab those coffees and let’s dive in!
4. Google Display ROAS Growth in 2019
To get the average ROAS for 2018 and 2019 for comparison, we looked at cost, impressions, clicks, CPCs, conversions, CVRs (conversion rates) and conversion values for Display Only campaigns for over 2,000 merchants. Here’s a breakdown of the data:
As you can see from the table above, although the average CPCs increased in 2019 for Display ads, conversion rates improved, and so did the number of conversions (quite dramatically), with conversion values being on par. Simply put, CPCs may have been higher, but ROAS remained at 14, meaning that more was spent, but more sales were generated, keeping ROAS high.
Another uber critical stat we can take from this Display portion of our Google Ads ROAS case study is the average CPCs and CVRs for 2019, which you can use as a Google Display benchmark.
- 2019 Average CPCs for Google Display Ads: $0.24
- 2019 Average Conversion Rate for Google Display Ads in 2019: 20%
In fact, Google Display ads offer the lowest CPC and highest CVR potential amongst Google’s ad options. However, it is important to note here that the majority of Google Display ads are remarketing ads. You can read more about winning Google eCommerce remarketing strategies here.
3. Google Search ROAS Growth in 2019
Next, we analyzed Google Search ROAS for 2018 and 2019. Again, we took into consideration the total spent on search ads in our study and the number impressions, clicks and conversions to determine conversion rates and ROAs for Google Search. As you can see in the table below, the average CVRs were 80% higher!
Additionally, even though CPCs increased in 2019, CVRs and conversion values improved so dramatically that it gave ROAS a good boost. ROAS in 2019 increased from 11 to 14, which is a 27% improvement!
Additionally, you will want to take the average Google Search CPCs and CVRs achieved during the whole of 2019 to help you set Google ad performance benchmarks and goals.
- 2019 Average CPCs for Google Search Ads: $0.51
- 2019 Average Conversion Rate for Google Search Ads: 9%
Pro Tip: It goes without saying that to achieve similar results, you need to ensure your Google Ads are always optimized to the max in real-time. You can do this manually by following these tips (to start with) or by using cost-effective tools like Traffic Booster, which will not cost you more than your set Google Ads budget.
2. Google Shopping ROAS Growth in 2019
Next, let’s look at the ever-improving Google Shopping. There is no doubt that Google Shopping has proved to be a leading eCommerce marketing channel since launching, but do the numbers show they are worth the hype? They sure do! Take a look at the table below.
The first thing I am sure you noticed above is that almost everything has doubled or tripled, except CPCs, which have decreased. Furthermore, we found that although the conversion rate stayed a consistent 2% in 2018 and 2019, the conversion value rose by 448% which is why you see much better ROAS. ROAS increased from 8 to 15 – which is an 87.5% improvement!
Additionally, with regard to average CPCs and CVR rates for Google Shopping in 2019, let me break them down for you:
- 2019 Average CPCs for Google Shopping Ads: $0.30
- 2019 Average Conversion Rate for Google Search Ads: 2%
1. Google Video ROAS Growth in 2019
And the Google campaign type that showed the most ROAS improvement in 2019? Video! Let’s look at this juicy data below. Although the average CPCs have increased and impressions have decreased, the quality of those impressions and clicks improved. How do we know this? By the increase in the number of conversions (a whopping 526%).
Furthermore, by considering the amount spent on Google video ads and the number of impressions, clicks, and conversions they resulted in, you can see a huge improvement in average ROAS – with specific growth in YouTube Shopping. This astounding 800% change in average ROAS from 2018 to 2019 shows how much untapped potential Google video ads still have for savvy eCommerce marketers.
Again, there is more highly valuable data we can extract from this eCommerce ROAs study, including the average CPC and CVRs over 2019 that you can then use as a benchmark for your Google marketing in 2020.
- 2019 Average CPCs for Google Video Ads: $3.62
- 2019 Average Conversion Rate for Google Search Ads: 12%
Despite the enormous potential Google video ads offers eCommerce brands, there are still so many successful stores that are not capitalizing on it. Yes, your CPCs will be higher, and there is more investment initially, but with a 12% conversion rate and the growth in ROAS potential, there are a lot of missed opportunities here – especially if you incorporate Google video with other marketing channel strategies.
Pro Tip: A good example of using Google video strategically is by harnessing the power of YouTube to recover abandoned carts. You can read more on how to do that in our Use YouTube Ads to Recover Abandoned Carts in 6 Steps guide for intermediate marketers.
Here’s a summary of Google Ads ROAS growth from 2018 to 2019 across all the campaign types.
As we look at all the Google campaign types as a whole, you will see that this marketing channel is consistently getting online seller conversions year-on-year. Not only in terms of ROAS – which, as any online seller knows, is the key to ensuring we get the sales we want for the spend we have, but also shows big growth in the conversion value from 2018 to the end of 2019 – with no sign of slowing down.
Got Google Ads questions? Post them in the comments below; our Google PPC gurus are standing by.
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