Shopping Ad Auctions When shoppers search for products on Google, they can see relevant shopping ads for offers from many stores.
Shopping Ad Auctions
To participate in shopping ads in countries where the CSS program is available, a merchant must be represented by a comparison shopping service, also known as a CSS, or with several CSSs. There are many to choose from. Each CSS offers different services and different pricing models. Some charge their customers per click. Others charge a commission whenever an ad leads to a sale. Or as another option, they may charge a fixed monthly service fee, while the merchant pays Google for clicks from the ads.
All comparison Shopping Ad Auctions services compete for ad space equally, including Google Shopping. The placement of the ad depends on a few factors. Ads need to follow the same basic rules designed to make them helpful to users. Each CSS bids in an auction how much they would be willing to pay for an ad click to your website. Who wins the auction depends on the bid, quality, and relevance of the ad. Let’s look at a couple of examples.
Try Google Ads now https://www.ads.google.com/
For simplicity, we will assume all ads have the same relevance and quality, and the bid is the decisive factor. Mary runs a large online shoe store. She works with CSS 1 to place shopping ads. Joe runs a shoe store in Madrid. He works with CSS 2 to tailor shopping ads to his needs. The next time a shopper looks for a new pair of sneakers, both Mary and Joe hope to get their attention with their shopping ads. The auction begins.
CSS 1 bids $0. 30 to place Mary’s ad, while CSS 2 bids $0. 20 on Joe’s behalf. Since Mary’s CSS bids more, she wins the auction for this ad placement. But CSS 1 only pays $0. 20, which is the amount of the next highest bid. Mary and Joe decide to work with additional CSSs. She hires CSS 3 for the different pricing models and features that it offers.
Read Also: What is Google Ads? How Google AdWords Works
Joe also adds CSS 4 because they will only charge him if his ads turn into a purchase. They all participate in the next auction. CSS 1 bids $0. 30 and CSS 3 bids $0. 25 on behalf of Mary, while CSS 2 bids $0. 20 and CSS 4 bids $0. 10 on behalf of Joe. Since the CSS 1 bid is the highest, Mary wins the auction again. But CSS 1 still only pays the $0. 20 that CSS 2 bid on behalf of Joe. The price paid to maintain the position is never determined based on the bids for the same merchant.
What matters is the next best bid for a different merchant. What CSS 1 charges Mary for the click depends on the agreement they have. For example, CSS 1 may charge a fixed CPC of $0. 30 for each click, or they may charge Mary a commission if the click, indeed, led to a sale. Or as another option, they may charge a fixed monthly service fee, while Mary pays Google for clicks from the ads. For more tips on participating in the shopping ads auction, visit the Help Center.