The Definitive Guide to Dynamic Search Ads for e-commerce

This is the most comprehensive guide for Dynamic Search Ads for ecommerce.

No generic advice or material copied from Google’s documentation. Just a practical guide that you can use to actually build sophisticated DSA campaigns for your store.

Let’s get started.

visual graphic to show dynamic search ads from your website content

About the author

My name is Gerasimos Nikolopoulos and I am the CEO of adaplo. Before starting adaplo I worked at Coca-Cola, Google and then founded a digital analytics agency. For the last 6 years, I have been training students and professionals on Google Ads and Google Analytics at Google events and have spoken at international events such as the Meet Magento and Superweek.

Chapter 1

In this chapter

Dynamic Search Ads (aka DSA) is a campaign type that gives us the opportunity to advertise on Google search without using keywords. Although it was introduced in 2011 and it is a really powerful tool in our arsenal, to this day most stores do not fully utilize it. And it is a pity. So I’ll try to give you the info so that you can fix this by first explaining how they work.

As I mentioned, for DSA we do not need to add keywords. This is a radical shift to how we think about Search Ads. Typically when we want to advertise something (an offering, a product or our whole website) first we do keyword research so we identify the best keywords that would allow us to target the right prospects. Not with DSA. What happens instead, is that we provide Google with what we want to promote (“the content”) and Google uses its algorithmic-magic and shows our ads to relevant searchers. So in simple terms, DSA removes the need to do keyword research and to be honest, does a way better and more extensive job than the one we could do.

Dynamic Search Ads compared to classic Search Ads

It is not difficult to understand how Google can identify the right keywords if you just think that Google has indexed all the web pages out there and “knows” what each page of your website is talking about. Basically, it uses the “SEO data” to automatically build Ads campaigns for you.

There are 3 main benefits of DSA:

  1. Save time from building your campaigns: Good keywords research requires a lot of time, time that we may not have or does not make sense to invest (eg low-spend accounts, launching a new small category, expanding to all website categories). I could even say that it also saves time from optimizing keyword campaigns because if you combine DSA with Smart Bidding you have a powerful combination in your hands.
  2. Show up in more relevant searches: Let’s be realistic, no matter how much time you invest in KW research, you cannot match the available data or the computing power of Google. So why fight with the machine and not work with it? We can use DSA to identify long-tail queries. And if you want, you can still keep them in DSA. Or you can break them in granular keyword campaigns, as you can read in the optimization part of this guide.
  3. [Bonus] Show up in low-volume queries: Have you stumbled on “low search volume” keywords into your account and would really want them to get some visibility? Yes you did, and DSA is the answer. Google says that it does not show our ads due to the low number of queries but really it is also about privacy. It would not be really good to be able to show an ad to a specific query even if it appears just a few times (eg you can target names of people because many professionals search their names so they can see what appears). But this would not be right so Google does not show anything. Given that with DSA you combine many different “keywords” in a specific targeting, all this has enough volume so Google also shows your ads on these queries. Nice ;)
small robot to represent our grader

Free automated evaluation of your Google Shopping Campaigns performance

Grade your Google Shopping in less than 1 minute

Since now you know what DSA is, let’s see where do they fit into your PPC game. Because on PPC, and especially ecommerce PPC, we have different campaign types (our weapons) in order to be able to compete in this game (fight). DSA was, and is becoming more, an important one.

We will review the role of DSA into our campaigns into two parts; the account/campaign launch and the ongoing optimisation.

How Google DSA can fit in your PPC strategy

These are the roles that DSA will play when we first launch Google Ads campaigns for an ecommerce store or when we are implementing a full account restructure.

DSA is the best way to go live on your Search campaigns for 2 reasons:

  • No need to wait 1-2 weeks to implement KW research in order to go live. You can go live literally today and start collecting live data (My experience is that all businesses value the speed of launching/restructuring and DSA is the way to go).
  • Saves valuable complexity into the ad account. If you do not have actual click data and you want to do great work, you actually have to make all the campaign/KW combinations. You should build campaigns per category, top products, brands, subcategories, etc. Tons of different break-downs you can use to build up your campaigns. The thing is, however, that as you will do this and take the account live, in a few days you will see that many (or most) of the KWs will actually take 0 clicks. This means that you now have to manage an account of XYZ campaigns, YZX AdGroups that is quite heavy (even downloading the data into Google Ads Editor takes time…), although most of it is actually not needed.
  • Apart from saving account complexity, it also saves time. Can you imagine having to build up only the campaigns that will actually have traffic and will be high-converting? What a big time difference. Time that you can use to optimise other parts of the account. Or have fun ;)

Note

Stop doing KW-level forecasts for your PPC. This is old “media planning” game of the non-digital world and it does not make sense in our world. Just launch and we will have accurate data to base all your forecasts in a few days. Way better than spending days trying to make forecasts using KW planner...

We have seen how powerful DSA is for an account launch. But it can be equally, if not more, powerful for the ongoing optimization of the account.

DSA can benefit the Google Ads account on ongoing optimisations for other campaign

You should have DSA campaigns into your account because:

  • Be your fishing net: These campaigns act as your “fishing net”, meaning they help you find new high-converting keywords. After you find them, you create these as exact KWs into SKAG, write a relevant ad and bid more intensively. And you add these as AdGroup negatives into the DSA campaign. The nice thing is that this is an ongoing effort and as much as you review these search terms, the more small diamonds you will uncover.
  • No effort needed for smaller categories/brands: If you are operating an e-commerce store with a small amount of SKUs this does not apply to you. But most stores offer more than 1k SKUs (and many ways more). And in such stores, it is really difficult and time needed in order to build campaigns for everything. It is not only difficult and time-consuming, but it is also a non-positive ROI activity. Use DSA for all these categories
  • Catch-all: “Catch-all” is a concept in engineering. Basically, when we are trying to think of all the possible scenarios for a specific case, it is a good idea to have a “catch-all”. We should have baked into our strategy what will happen if none of the scenarios that we planned works. In the campaign analogy, the “catch-all” is a campaign that is there in order to get all the other KW ideas that we have not thought off.

Note

The best game on search is actually like fishing. Although Google has given us all these match types, the best way to tackle all this is by using the extremes of the spectrum. Full broad targeting to get all the new “ideas” in. And then use the spearfishing to go after the big fish (exact keywords into SKAGs).

Note

Always think your Ad Management activities ROI. How much time you are investing and what are you getting back? Does this make sense? Prioritize!

DSA went live in 2011. Why should I care now?

Despite the fact that DSA campaigns are extremely effective and most ad accounts do not max them out, something important happened in 2018. Actually, in April 2018, Google launched a new version of DSA that among others has an important new feature that is extremely powerful for ecommerce (and at adaplo we are all about ecommerce). Apart from being able to target just Ad Testing, now Google “gets” also the category pages. And this is big.

Chapter 2

In this chapter

Let’s start from the “standard” campaigns and then I am going to explain the “catch-all” campaign.

For starters, let me tell you that the targeting on DSA is called “Dynamic Ad Targets” (it is the equivalent of keywords in the standard keyword campaigns). This targeting is applied on the AdGroup level.

Google offers 3 sources to show Dynamic Search Ads. Automated, Manual and All Webpages

There are 3 ways that we can use in order to define our Dynamic Ad Targets:

  1. Categories recommended for your website (Google automation)
  2. “Create a new rule….” basically using URL targeting
  3. Target all web pages (which actually is the “catch-all” category that we are going to discuss in the next sub-section)

In short, categories are predefined targetings that Google has identified and that you can easily add in your campaigns. They are easy to use and most of them would be high quality. This automation, however, might not know something that is important for your business, eg what category you want to push or if you want to break your targeting/budgeting/reporting by a specific brand. For all these reasons, you can use the URL targeting.

Select ad target for DSA campaigns on new Google Ads UI

URL targeting on adgroups of DSA campaign

So now that you know how these targeting methods work, let me tell what you should use and when. If you do not have enough time, just use the categories proposed by Google. If on the other hand, you have some more time, I would follow the same structure you have in your search campaigns. Eg if you break your campaigns by category (level-1), I would do the same for DSA. If you break by brand, I would also do the same for DSA. This way the whole account is easier to manage and easier to analyse.

Template for DSA campaign structure using different ad targetings

How to break your campaigns?

As I have promised, I am making all these guides, really practical so this is the summary answer:

  • Build different campaigns per product category and add inside as AdGroups all the relevant targeting (eg some AdGroups with “category targeting” and some that have URL targeting that you have set)
  • Break each dynamic ad targeting into a different adgroup
  • Do not break campaigns by RLSA lists, but just add RLSA modifiers

A catch-all campaign is a campaign that targets the whole website. It is a mass weapon and as all mass weapons do not have the best accuracy, but has its value.

How to use a catch all campaign on your DSA structure

The benefits of using a “catch-all” campaign are:

  1. You can actually just launch this campaign for the start and save time
  2. Many times you have missed something on your keyword or DSA campaigns. This will pop-up on your “catch-all” campaign.
  3. It can identify really cheap, long-tail queries that could be good for your bottom-line

How to setup

  1. Either use URL targeting with “/”, effectively telling Google to target everything
  2. Or use the “target all web pages” option that is now available in the Google Ads UI

DSA catch-all targeting example

Note

Make sure that your bidding/modifiers take into account what is happening in your other campaigns (DSA or not) or else your “catch-all” might be getting traffic that should go elsewhere. Long story short, use a bid that is lower than all your other bids and apply the same modifiers (device, ad scheduling) as in the other campaigns.

(This KPI-related section is a short version of the same section in our Google remarketing for ecommerce guide.)

The whole idea of a KPI (that is so heavily abused these days) is to have a KEY performance indicator that clearly shows you if you are winning or not. As a result, you cannot have as your target 2 or more metrics. You should always have one metric that you measure success. You can use, however, secondary metrics to show you the scale of the success (1st: ROAS, 2nd: conversions) or to set minimums (ROAS as the KPI but with a minimum of $12.000 ad cost/month). Since we have agreed that you have one, now we need to figure out which one.

roas explained versus cpa versus cpas

Without a doubt, ROAS is not the perfect metric. There are more aspects of the value that you can include and a quick one is the gross margin of the business (implementing ROAS on the “gross margin” not on the revenue). Other more advanced aspects of the customer lifetime value and offline conversions, but I am saving this for another guide. Although not ideal, ROAS is a good way to go.

There are two big categories of bidding methods, the manual ones and the automated ones (now called smart bidding).

On the manual methods, you are able to set yourself different prices (bids) on clicks on your ads.

On top of the manual one, Google Ads offers 4 automated bidding methods, now called as a whole “Smart Bidding”. These are part of the various Machine Learning initiatives by Google that aim to give us better tools to manage our advertising. On these methods, you do not set an actual price (bid) but actually what is your target value on the KPI and let the machine handle the rest.

Manual bidding method

  • Manual CPC

Smart bidding

  • Enhanced CPC
  • Target CPA
  • Target ROAS
  • Maximize conversions
What bidding method should I use?

I assume that your KPI is either a ROAS target or a CPA. In that case, my recommendation is to start with manual bidding (setting a CPC price for each click) and after you get your first 50 conversions do a pilot with the Smart Bidding methods. Give the pilot ample time to show its potential (3-4 weeks). If it helps your numbers, keep it, if not return to the manual method.

In order to make the most out of your manual method, add the “enhanced CPC” option (which effectively adds a “smart” layer upon your manual bidding) and perform periodic bidding optimizations (weekly, not daily) so you can optimize the performance. You can do this with a decision tree approach.

If you have not used some automated bidding strategy (as listed in the previous section), bid modifiers are extra levers you can use to optimize the performance based on your goals.

You can use bid modifiers on 3 different dimensions:

  • Device: what device is the user using (mobile, tablet, desktop)
  • Location: at what location is the user browsing from (location can be targeted with different granularity starting from the country level but down to a radius around a specific location)
  • Day/time: at what combination of weekdays (eg Monday, Saturday) and hours (name every hour of the day) will the user see the ad

available bid modifiers on google ads

In order to apply these bid modifiers, you have to look at the past performance and based on these numbers, apply the modifiers. The idea here is that you want to boost what is working well and decrease the exposure of what is not working well. The north star on this optimization is, no matter what dimension are you using to break-down the results, your main KPI is almost the same across each value of this dimension. For example, if you are checking at the performance by device and your KPI is ROAS, you should have x3 across all devices. This means that you are advertising in the most efficient way.

I have to be honest. Ad testing on the DSA campaigns is one of the lowest impact optimization activities. And this is because the most important part of a Search Ad (your headline) is out of your control on Search Ads. We do, however, care about perfection and if you want to achieve this you also have to optimize this dimension.

What elements of the ads you can test?

You can actually test either the description lines or the visible URLs. I say either/or because it is not a good idea to test both at the same time as you will not be in the position to judge which of the two actually impacted your results.

Steps to follow when ad testing Dynamic Search Ads

What are the steps for the ad testing?
  • You start by defining what your KPI is (it is advised to use the same KPI you have for your campaigns. Only in instances of really low data volume, you can just use CTR as a proxy)
  • Then you create different ads and applying these into the different AdGroups
  • You make sure that you have enabled a “rotate evenly” campaign setting so that Google gives the chance in all your ads and does not start to prematurely optimize and show some of your ads more
  • Do not rush decisions. Leave the different ads to run for at least 1 week.

dsa can run on both google search and search partners (other sites like nytimes, youtube, etc.)

A useful way to look at possible optimizations on your campaigns are the different segmentation reports offered on the Google Ads UI through the “SEGMENT” button. Everything that can be segmented is something that we can look at the data at a lower level and thus identify the winning parts and the losing parts. Then we boost the winning parts and lower the losing parts. And BAM!

how to review your reach on search partners vs Google Search results

One of the available segmentations, that is not used by many is the “Network” segmentation that effectively breaks your performance by the network. By “network” we usually refer to “Google Search” and “Display Network”. However, usually, this is not of any help at all because you do not get to have a campaign advertising on both these networks. The only chance you are doing this is if you are using “Search with Display select”, which is actually a bad choice. It is bad because you cannot evaluate a campaign if it consists of two totally different parts. For example, CTR on Search might be 5% whereas on Display is its like 0.3%. How can you mix these two and be able to get meaning out of them?

small robot to represent our grader

Free automated evaluation of your Google Shopping Campaigns performance

Grade your Google Shopping in less than 1 minute

Although the Search/Display segmentation does not add real value, on the other hand, if you see the break-down of “Search”, this can add. So the full Google Search Network consists of two parts; Google Search and Search Partners (various websites that have embedded Google Search so that you can search the web through them). Depending on your location these Search Partners might be an important or not so important part. In the example below, we see Search Partners getting 0.7% of the spend, so they really do not matter. But if in your case it is like 5-10%, you should look at how they perform. Usually, their performance differs from Google Search in either positive or negative ways (in the example below you can see that they have ⅙ of the CTR).

search partners actual results on Google Ads

If they do not perform well for you (and you can only judge this based on your KPI), just disable them. To do so you have to go to the campaign settings of your DSA campaign and untick the box for the Search Partners.

The available networks for DSA and what to select

Doing query mining is one of the 2 most important optimization activities that you will do on your DSA campaigns. Not doing this is actually one of the top reasons why DSA campaigns do not work for your store. And, unfortunately for all of us, it is actually the single most time-consuming optimization activity on DSA.

Query mining is the most important optimisation for the success of your DSA campaign

This is important to be done for both offensive and defensive reasons. In terms of defensive, you must understand that DSA is a mass-destruction weapon and as in all of these weapons you should be really careful where you target it. If you do not control its reach, you can actually be paying for a lot of crap and actually waste tons of money. In terms of offensive reasons, you should do query mining in order to find the top-converting KWs and play full offence on these. Separate them from the main campaign, write a targeted campaign for these and bid accordingly (not with tens more).

How should I do query mining?

1. Download the “Search Terms” report for the DSA campaign(s) and
2. open the report on MS Excel or Google Spreadsheets.
3. Add an extra column on the data where you can write “positive” or “negative”.
4. Start with sorting the terms by “Cost” and
5. negate all the terms that cost a lot but are either not getting conversions or seem not relevant.
6. Then sort by “Conversions” and
7. add as positive almost all these queries.
8. Then, ideally, but only if you have time you can rank all terms by impressions and go as deep in the report as you can.

How frequent should I do query mining?

In short, when you launch the DSA you have to do query mining as frequent as you can (ideally 1/day). After the first 10-15 days, you can safely make this optimization on a weekly basis. At launch, it is really critical to do this often because most of the times you will advertise for some really bad queries that will have a significant hit on your results and thus your DSA will not look good. Many companies pause their DSA at that time.

These are the actual techniques we are using on the campaigns we run for our Clients and now you can also implement these in your accounts.

Happy sales!

P.S. - At adaplo we are relentlessly working to automate the campaigns of online retailers to provide a performance boost. If you do not have the time to implement all the above, I would be happy to share how we can help.