Navigating the Evolving Landscape of Shopping Ad Performance

What is the Digital Markets Act?

Every marketer and their legal team need to be aware of the changes now in effect that affect the ability to target advertising at audiences within the European Economic Area (EEA). These changes are reshaping the landscape of first-party data activation in 2024 and beyond.

The Digital Markets Act (DMA) seeks to regulate gatekeepers in the digital world, including companies like Google, Meta and Amazon, to ensure fair competition and protect consumers.

At Jellyfish, we’ve created a dedicated microsite that showcases all the adaptations needed for advertisers in a post-DMA world. You'll find indispensable insights and immediate actions required for those utilizing platform products reliant on first-party data. We’ll be updating it regularly as the platforms release critical updates in the ever-evolving digital arena.

What’s changing in the SERPs?

The DMA regulations took effect on March 6, 2024. Consequently, Google has begun implementing several alterations to its Search Engine Results Pages (SERPs), and advertisers/marketers need to be aware of these changes. At Jellyfish, we've observed a noticeable decrease in traffic from SEO and Paid Search text ads for some clients since March, with a drop in the pixel page position for SEO (not ranking). At the same time, there's been an increase in clicks through Shopping ads. It's likely that the greater visual prominence of Product/Shopping tiles in the SERP is causing this shift in traffic.

New features

You’re going to see alterations in the SERPs affecting Comparison Shopping Services (CSSs) Product Description Pages (PDPs). CSSs can now guide traffic to their own PDPs both organically, through Free Product Listings, and via paid placements using Product Listing Ads (PLAs). CSSs will participate in these opportunities under the same conditions as other merchants.

Additionally, you’ll see two new filters in the query shortcut bar:

• A Products Filter showcasing product tiles that, upon clicking, reveal a view with links to product pages from both merchants and CSSs.
• A Product Sites Filter that opens a dedicated view to CSS sites. The shopping property tab will no longer be featured in the SERP.

Jargon Buster:

A Comparison Shopping Service (CSS) a website that collects product offers from online retailers and then sends users to the retailers' websites to make a purchase.

A product description page (PDP) teaches shoppers about your product's features and benefits before they complete their purchase.

Search enhancements

Expect to see further modifications to enhance the visual aspect of search:

• Introducing two exciting new experiences tailored for both general and product-specific searches, featuring special deals from merchants and Comparison Shopping Services (CSSs).
• Rolling out an improved search preview after clicking, showcasing product offers from both merchants and CSSs, complete with product images and relevant details.

Google has created a special section for comparison sites and direct suppliers, where they can showcase detailed results, including images and star ratings, in one convenient place.

Introduction of Search Query Shortcuts

Google is working on adding quick shortcuts at the top of the search page to help users fine-tune their searches, like guiding them straight to comparison sites. This could change how people search, as they might start using these shortcuts to go directly to comparison sites instead of clicking on individual Shopping Ads. As a result, there might be fewer clicks on Shopping Ads, leading to a potential decrease in Click-Through Rates (CTR).

What implications does this hold for advertisers?

This might make the competition fiercer among advertisers, as they'll have to compete not just with other Shopping Ads, but also with comparison sites and direct suppliers for top spots on the search results page. This could lead to a higher Cost Per Click (CPC).

On the bright side, advertisers running Comparison Shopping Service (CSS) Product Listing Ads (PLAs) alongside their regular PLAs could see some advantages. They could have a stronger presence in the search results, with ads leading users to both their website and the CSS Product Details Page. This dual approach could help them stand out against competitors for certain products.

Is partnering with a third-party CSS the new standard?

It's not always the case, and initially, it's not something Google suggests as a solution to this issue. Showing Comparison Shopping Service (CSS) Product Details Pages (PDPs) could actually distract users, steering them away from the advertiser's own product pages. While it might seem like a way to dominate the search results and outshine competitors, there's no guarantee that users will engage or make a purchase when they land on a CSS PDP. Plus, these pages might display listings from different retailers, encouraging users to browse and buy products beyond what's being advertised.

Google Recommendations

Google is suggesting not to make any change to your current setup, so if you are not using a third-party CSS there’s no need to jump into working with one. 

Our experts recommend that in addition to maintaining your current strategy, it's crucial to consistently monitor the performance of your campaigns, including CPCs and any decline in conversion rates.

Conclusion

In the beginning, advertisers may notice fluctuations in performance metrics for shopping ads, like Click-Through Rate (CTR), as user behaviors and search result layouts change due to Google's compliance with the DMA regulations.

Advertisers should closely monitor the performance of Shopping (PMax), ensuring all feeds are optimized thoroughly. Additionally, they should allocate sufficient budgets to accommodate any adjustments in strategies, enabling them to adapt effectively to the changing search landscape.