Product ads are a very popular method of promotion. Although creating an advertising campaign is rather an easy process, it often turns out that our endeavors don’t bring expected results. Low conversion from ads is one of the most common problems that retailers must face when it comes to product ads.
So how can you increase ROAS and avoid unnecessary money loss? You’ll find the answer in the article below.
Too high prices for promoted products are a common problem in the e-commerce industry. Nowadays, customers have access to various price comparison tools, e.g.Google Shopping, that allow them to find the cheapest offers. Therefore, if your ads have a high number of clicks but a low conversion rate – it’s very likely the price is the main problem. In such a situation, the customer may be interested in the product, read the description on the website, and then decide on a cheaper offer.
Although each case should be treated individually – after all the price is influenced by numerous reasons e.g. product category, the credibility of competition, and the number of competitive offers – it is assumed that the price should not be higher by more than 5-10% compared to the competition. Of course, in an ideal scenario, it should be even lower. However, it’s not always possible.
First – you can check the prices manually. What you need to do is simply visit your competitors’ websites, and check price comparison web pages and marketplaces to verify your products’ prices. You can gather the results in an Excel file, and then adjust the prices to the market conditions or cancel the promotion. This solution will work best for small shops with a rather small assortment. However, if you are a bigger retailer, such an approach may turn out to be too time-consuming, especially that in e-commerce the prices can fluctuate even a few times a day
The second method is to automate your prices. Today you’ll find various tools that will help you to track your competitors’ prices. One of them is Dealavo – a price monitoring software that gives you access to up-to-date data about your competition.
The crucial question retailers must ask themselves before kicking off with promotions is which product to choose.
Many merchants want to stand out from the crowd by offering niche products. Unfortunately, as far as product ads are concerned, such a decision may not be profitable.
While selecting the goods you’d like to promote, aim for those well-known and highly-rated by your clients. To find out which of them are liked and willingly chosen browse client reviews in your store as well as in competitors’ shops. You can also check best sellers ranks like Amazon Best Sellers.
The next step is to check the availability of the chosen products in the competitors’ shops. Competitors’ assortment recognition is essential for detecting stock shortages. For instance, it may turn out you are the only seller that offers certain articles. That, on the other hand, will give you a chance to increase your margin without losing a leading position and – most importantly – without losing customers’ interest.
Before starting an advertising campaign, it is also worth tracking what products your competition promotes and what platforms & websites they choose to display their special offers. Analyze competitors’ advertising campaigns, check price history and target groups to which the advertisement is directed. That will allow you to determine the strengths and weaknesses of competing promotions and – improve your advertising strategy.
Both assortment monitoring and promotion tracking can be easily automated today by using price monitoring tools.
Product advertising may include more than one product. Even though normally you will promote one chosen article, you can increase your AOV e.g. by using cross-selling practices. Offering complementary products makes your AOV rate higher, and – at the same time – increases your ROAS.
Let’s say you run an e-store with bikes. When a client buys one of your two-wheelers, you can offer them some additional products, like bike helmets, cyclewear, or phone handles.
It’s very likely that with such an opportunity a group of shoppers will be tempted to purchase additional articles they didn’t intend to buy beforehand.
What’s more – the buyers compare the prices of the „additional” products much less often. It means that when using cross-selling practices, you can frequently increase the margin of complementary products.
Another way to increase your AOV is upselling. Upselling is a method of offering a premium version of a particular product. Therefore, if you plan to start an advertising campaign for legacy Apple products, maybe – in contrast – you should offer your clients the newest version as well?
Increasing conversions from product ads can be easier than you think! If you’re struggling with low ROAS, consider using automated solutions for better selection and product pricing.
We hope the tips we presented you with will prevent you from money loss and help to increase your sales profits.
Don’t waste more time and money, and take your ads to the next level!
Would you like to analyze the prices of products promoted in Google Ads and compare them with the competition? Thanks to iCEA’s cooperation with Dealavo, you can set up a free 7-day demo account in the Dealavo tool for up to 1000 products! Book a free consultation to increase ROAS from your ads.
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