Most ecommerce businesses think of Google Ads as an advertising channel.
You invest money, generate clicks, drive sales, and measure metrics such as conversion rate, cost per acquisition, and return on ad spend (ROAS).
Those metrics are important—but they only tell part of the story.
Your Google Ads data can do much more than tell you whether your advertising is working. It can provide valuable insight into what your customers actually want, which products deserve more investment, and which products may not belong in your catalog at all.
In other words, Google Ads can become a powerful product research and merchandising tool.
Here are five ways ecommerce brands can turn their advertising data into better product decisions.
- Look Beyond Revenue and Focus on Profitability
One of the biggest mistakes ecommerce businesses make is evaluating products based primarily on revenue.
A product generating $100,000 in sales sounds better than one generating $50,000.
But revenue isn’t what you deposit in the bank. Profit is.
Imagine Product A generates $100,000 in sales with a 20% gross margin, while Product B generates $50,000 with a 50% gross margin.
Product B could actually produce more gross profit despite generating half the revenue.
Now add advertising costs to the equation.
If Product A requires significantly more advertising investment to generate each sale, its economics become even less attractive.
That’s why product-level advertising data should be evaluated alongside your margins.
Look at metrics such as:
- Sales
- Advertising spend
- Cost per conversion
- Conversion rate
- ROAS
- Gross margin
- Return rate
- Average order value
The goal isn’t simply to identify which products generate the most sales.
It’s to identify which products generate profitable sales.
- Use Google Ads to Identify Your Product Winners
Here’s one of the most valuable things about ecommerce advertising: your customers get to vote.
And they vote with their wallets.
You may have a product your purchasing team loves. You’ve negotiated a great deal with the supplier, invested in professional photography, and built what you believe is an outstanding product page.
Then you put the product in Google Ads—and nobody buys it.
Meanwhile, another product that seemed relatively ordinary continues generating sales.
Pay attention to that.
Your customers may be telling you something.
When you identify products that consistently generate conversions at an acceptable advertising cost and have healthy margins, you’ve found potential winners.
That information shouldn’t stay inside the marketing department.
It should make its way into your purchasing and merchandising decisions.
For a winning product, you might:
- Increase inventory
- Negotiate better supplier pricing
- Expand the product line
- Introduce additional variations
- Create bundles
- Develop complementary products
- Increase your advertising investment
Your best-performing products can provide clues about where your business should go next.
- Pay Attention to What Customers Actually Search For
Another valuable source of product intelligence is your search-term data.
There’s often a disconnect between the terminology businesses use and the terminology customers use.
A manufacturer might give a product a particular name. Your merchandising team might use another term. But your customers could be searching for something completely different.
That matters.
Search behavior gives you a direct look at how your customers describe the products they want.
This information can influence:
- Product titles
- Product descriptions
- Category organization
- Product-page copy
- New product development
- Product sourcing
But there’s an even bigger opportunity.
Look for searches that represent products, features, sizes, colors, or variations you don’t currently offer.
If customers repeatedly search for something you don’t sell, that could represent a product opportunity.
Instead of guessing what customers want, you’re getting the information directly from their search behavior.
That’s valuable market research.
- Don’t Make Product Decisions Based on a Few Days of Data
There’s a danger on the other side of data-driven decision-making: reacting too quickly.
An ecommerce owner sees a product struggle for three days and decides it’s a loser.
Or a product has one exceptional week, and suddenly everyone thinks they’ve discovered the next blockbuster product.
Neither conclusion is necessarily correct.
You need enough data to identify meaningful trends.
Consider:
- Seasonality
- Product price
- Promotional periods
- Changes in advertising strategy
- Inventory availability
- Competitor activity
- Historical performance
A product’s performance also needs context.
For example, Product A might have a lower ROAS than Product B.
At first glance, Product B appears to be the obvious winner.
But what if Product A has a significantly higher average order value?
Or what if Product A has a much higher customer lifetime value?
Or perhaps Product B generates a large number of returns while Product A has extremely satisfied customers.
Suddenly, the picture looks very different.
That’s why product decisions shouldn’t be based on a single Google Ads metric.
- Connect Google Ads Data With Your Business Data
Google Ads can tell you what happens from an advertising perspective.
But it doesn’t necessarily tell you the complete economic value of a product.
That’s where your other business data becomes critical.
Combine your advertising information with data from your ecommerce platform, analytics tools, inventory systems, and accounting.
Ask questions such as:
- What’s the gross margin?
- What’s the return rate?
- What’s the average order value?
- Do customers purchase additional products?
- What’s the customer’s lifetime value?
- Does this product generate repeat purchases?
- How much inventory are we carrying?
- Are we frequently running out of stock?
These answers can completely change how you evaluate a product.
For example, suppose Product A has a lower immediate ROAS than Product B.
You might conclude that Product B deserves more advertising budget.
But what if customers who purchase Product A are twice as likely to return and make another purchase?
Product A may actually be more valuable to your business over the long term.
This is why ecommerce brands need to look beyond surface-level advertising metrics.
Build a Product-Level Scorecard
If you want to put this approach into practice, start by creating a simple product-level scorecard.
For each important product, track metrics such as:
Advertising performance:
Spend, conversions, conversion rate, cost per conversion, and ROAS.
Sales performance:
Revenue, units sold, and average order value.
Product economics:
Gross margin, contribution margin, and return rate.
Customer value:
Repeat purchases and customer lifetime value, when available.
Then categorize your products into three groups.
Winners
These products demonstrate strong demand and attractive economics.
Your job is to find ways to sell more of them.
Potential Winners
These products show promise, but something may be holding them back.
The issue could be pricing, the product page, the offer, inventory, or the advertising strategy.
These products deserve further testing and optimization.
Losers
These products consistently struggle despite reasonable testing and optimization.
At some point, you need to ask whether continuing to invest in them makes sense.
And here’s an important point:
The answer isn’t always, “We need to advertise it better.”
Sometimes the answer is, “Maybe we shouldn’t be selling this product.”
That’s an important distinction.
Turn Advertising Data Into Better Business Decisions
The ultimate goal of Google Ads isn’t simply to generate more clicks.
It’s to generate more profitable customers.
But the information you collect along the way can help you make decisions far beyond your advertising campaigns.
Don’t let your Google Ads data stop in the marketing department.
Take it into your purchasing meetings.
Take it into your merchandising meetings.
Take it into inventory planning.
Use it to answer a much bigger question:
What does the market want us to sell more of?
When you combine Google Ads performance with product margins, customer behavior, inventory information, and overall business economics, Google Ads becomes much more than an advertising platform.
It becomes a decision-making tool.
And that’s when you can really start to Make Each Click Count.
Frequently Asked Questions
- How can Google Ads data help ecommerce businesses make better product decisions?
Google Ads data can reveal which products customers are actively searching for and purchasing. By analyzing conversion rates, advertising costs, ROAS, margins, and sales volume at the product level, ecommerce businesses can identify winning products, improve underperformers, and make more informed inventory and sourcing decisions.
- What Google Ads metrics should ecommerce brands use to evaluate products?
Key metrics include conversion rate, cost per conversion, ROAS, advertising spend, revenue, and sales volume. These should also be evaluated alongside business metrics such as gross margin, return rate, average order value, and customer lifetime value to determine true product profitability.
- Can Google Ads search-term data help with product research?
Yes. Search-term data provides insight into the language customers use when looking for products. It can uncover demand for specific features, sizes, colors, product types, or related products that an ecommerce business doesn’t currently offer, creating opportunities for new products or product variations.
- How do you identify winning products using Google Ads?
Look for products that consistently generate conversions at an acceptable advertising cost while maintaining healthy profit margins. Products with strong demand, good conversion rates, and attractive economics can be candidates for increased inventory, additional variations, bundles, or greater advertising investment.
- How long should ecommerce brands collect Google Ads data before making product decisions?
There isn’t a universal timeframe because it depends on traffic volume, sales volume, product category, and seasonality. Generally, businesses should collect enough data to identify a meaningful trend rather than making decisions based on a few days of performance. Historical and seasonal data should also be considered.
- Should ecommerce businesses stop selling products with poor Google Ads performance?
Not necessarily. Poor advertising performance may be caused by pricing, product-page issues, targeting, competition, or the advertising strategy itself. However, if a product consistently underperforms after reasonable testing and has poor overall economics, it may be worth reconsidering whether the product belongs in the catalog.
- Why should Google Ads data be connected to ecommerce and financial data?
Google Ads only provides part of the picture. Combining advertising data with gross margins, return rates, average order value, inventory, repeat purchases, and customer lifetime value helps businesses determine which products are actually contributing to long-term profitability—not simply generating revenue or clicks.
Need Help with Google Ads? If you’re ready to take your online store’s performance to the next level with Google Shopping Ads but need a helping hand, consider reaching out. I’m Andy Splichal, author of Make Each Click Count and host of the Make Each Click Count podcast. Whether it’s about creating high-performing Shopping Ads or mastering your overall Google Ads strategy, I’m here to help. Let’s make those clicks count!
ABOUT THE AUTHOR
Andy Splichal is the founder and managing partner of True Online Presence, author of the Make Each Click Count book series, host of the Make Each Click Count podcast, founder of Make Each Click Count University and certified online marketing strategist with twenty plus years of experience helping companies increase their online presence and profitable revenues.
He was named to Best of Los Angeles Awards’ Most Fascinating 100 List in both 2020 and 2021. To find more information on Andy Splichal, visit trueonlinepresence.com or read The Full Story on his website or his blog, blog.trueonlinepresence.com.