A Quick Guide To Price Drop: Google Shopping

Google Shopping campaigns serve a huge purpose in most advertisers’ marketing campaigns. In the best interests of advertisers, Google Shopping offers a variety of features to optimize campaigns–one of them being Price Drop. 

In this blog, we explore what a price drop in Google Shopping means, how you can enable it for your products, how it can impact user behavior, and best practices surrounding price drop in Google Shopping. 

Let’s begin. 

What is a Price Drop in Google Shopping?

Google Shopping’s price drop is a Google Shopping ad extension that shows users that the product’s price has dropped significantly. Google adds a ‘Price Drop’ badge to your ad listing, making it catchy and attractive to the audience viewing these ads. 

Here is an example of what it looks like 

How Does Price Drop Annotation Work in Google Shopping?

But how does Google identify which products are enabled for a Price Drop badge? 

When you update your feed to the Google Merchant Center, Google syncs your product feed to show its users the latest updated data. If Google notices a significant drop in the price of products compared to its 60-day average, it automatically adds the ‘Price Drop’ badge. 

It also shows the previous price and strikes it through to showcase the new price (as shown in the picture above). 

For a product to be eligible for a ‘price drop’ tag, its price has to fall by at least 20% from its 60-day average. While Google officially doesn’t mention the 20% mark, our research, and other online sources suggest that a drop around this range is when the tag usually appears. It also works best when the previous price has stayed stable for a while.

How Does Price Drop Look on Google Shopping Listings?

When the badge is applied, the new discounted price appears next to the original one. The earlier price is either struck through or shown as “Was $X” to highlight the drop clearly. You’ll also see a red “Price Drop” label on the ad, like in the HP laptop examples shown above.

Colors and layouts may vary slightly depending on the device or placement, but the badge stands out clearly to catch user attention.

💡Note: The ‘Price Drop’ badge differs from the ‘Sale’ badge. They are annotations that have separate requirements. 

How to Check Product Eligibility for the Price Drop Annotation?

Here is a quick way to check which of your products are eligible for the ‘Price Drop’ Badge: 

Step 1. Log in to your Google Merchant Center account and navigate to the ‘All Products’ page from the left side panel. Click on the ‘Filter’ symbol. 

Step 2. Among the options you are offered, scroll down to find the ‘Has a price drop badge’ and click on it.  

Your next screen will display all the products that show up to your users with a ‘price drop’ badge. 

💡Note: It is important to note that a drop in the product price does not guarantee that the price drop badge will show up. 

You cannot enable the price drop feature since it is automatic, but if your updated price product shows up, Google will detect it and thus make the product eligible for a price drop badge. 

Remember that it is incredibly important to ensure that your product feed is updated. Not only does it help keep your data updated, but it can also help you avoid product disapprovals that lead to Google Merchant Center suspensions and provide an enhanced user experience. 

How Price Drops Influence Google Shopping Ads

Price drops can significantly impact the performance of your products on Google Shopping: 

• Google prioritizes products with lower prices since it can potentially attract more customers to make a purchase. 
• If your product is the lowest-priced option, Google is likely to display it higher in the search results, thus increasing visibility significantly. 
• This also increases the ranking of your product and can have beneficial effects on your Shopping campaign. 

The ‘price drop’ badge can also improve your click-through rates. Since ‘price drop’ is additional information provided in a listing, it can also be considered as a ‘rich snippet.’ 

Using rich snippets in their Google campaigns, advertisers have improved click-through rates by 677%. 

Additionally, seasoned marketers have observed that adding these rich snippets can also optimize your Google Shopping data feeds.

The Impact of Price Drop on User Behavior and Purchase Decisions

Let’s explore how a user’s perception of the ‘Price drop’ annotation can positively impact your product performance. 

• Each time a user notes a significant change in the price of a product, they are encouraged to buy it–this can attract more customers and lower cart abandonment rates significantly. 
• Price sensitivity among users can also increase sales since lower prices create a sense of satisfaction among buyers who have bought an item at a discounted rate. 
• Additionally, a price drop will create a sense of urgency among buyers and can increase the conversion rates for your shopping campaign. 

A study showed that rich snippets (additional information such as lowered price) on a Google Shopping ad listing increased the traffic to the seller’s website by nearly 20%-40%.

Best Practices for Monitoring and Leveraging Price Drops

Here are a few practices you can engage in to ensure that the Price Drop annotation provide the maximum utility for your Google Shopping campaign optimization. 

Track Competitor Prices

To ensure that your head remains firmly planted in the game, consistently track your competitors’ prices. Use Google Shopping price drop alerts to get instant updates on changes in competitor prices.

While these alerts are mainly useful for consumers and not advertisers, they can still offer helpful signals about market movement and competitor pricing trends.

Doing this has two benefits:

1. You are aware of the market price of a particular product. This can help you leverage price drops effectively during special sales, holiday seasons, etc. 
2. Keeping track of competitor prices also ensures that you don’t go overboard with lowering prices compared to your competitors. This can help you increase your revenue while being ahead of the competition. 

☝️Suggestion:

• You can use a tool like Netrivals to monitor prices in Google Shopping. It allows you to include and exclude different brands and can even help dynamically reprice your products if you opt for it.
• You can also try the Dealavo tool. It helps with price monitoring on Google Shopping and other platforms. It tracks real-time prices, detects price wars, and suggests pricing updates. You can monitor thousands of products with hourly data refresh. It also supports dynamic repricing on Shopify, WooCommerce, eBay, and more.

💡Bonus: Also read our blog on ‘Google’s Shopping Price Tracker‘.

Choose Products for Price Drop Strategically

While Google does highlight products that appear to have a price drop, it’s important to know that you can’t control whether Google will display them. You can only select which products to include in a price drop batch, but Google decides what gets shown.

Dropping prices for all or most of your products may not work well:

• Not only does it reduce your total revenue, but it can also affect how buyers view the product’s quality.
• Google’s system is not built to handle fast or repeated pricing updates. While changes normally reflect within 2–3 hours, they can take longer. If your prices keep shifting within short periods (like every 72 hours), your products are more likely to face approval issues.

Instead, apply this strategy to a few high-performing products. These products can help attract traffic that later converts across your store.

💡Note: Avoid searching your own ads repeatedly. Each impression without a click hurts your CTR. That may increase your CPC and lower your ad rank over time.

Adjust your Bidding strategy.

Making the best use of Google Shopping bidding strategies can help you leverage products with the ‘price drop’ badge to provide an additional boost to the increased visibility of your ad listings. 

Manually set your bidding strategy to allocate higher bids for products with a price drop tag. 

Combining both of these features can positively impact your Google Shopping campaign and bring fruitful results. 

Conclusion

Price Drop in Google ads is a highly effective feature that brings several benefits such as increased visibility and increased conversions. The price drop tag can increase urgency among users, too.  

As mentioned above, Google Shopping price drop is a badge that can enhance your Shopping campaigns. Understanding what it is can help you maximize this feature’s benefits.

FAQs

1. What are price drop annotations in Google Shopping Ads?
Price drop annotations in Google shopping ads are badges that appear on the ad listing when the price of a product drops significantly below its 60-day average. It highlights the price drop to consumers and makes it more appealing to price-conscious shoppers. 

2. How much should the price drop for the annotation to appear?
To get the price drop badge to show up for your product, the price should have dropped by at least 20% from the historical average price in the past 60 days. This percentage has been derived from observations, as no specific percentage has been published by Google. 

3. How can I enable price drop annotations for my products?
Unfortunately, you cannot manually enable the price drop annotation. You can check the products that are eligible for the price drop annotation in your Google Merchant Center. 

Go to Products>All products>Filter>Has price drop badge.  

4. Are there any specific requirements for price drop annotations to appear? 

Yes. For the price drop badge to appear, your product’s price must be noticeably lower than its 60-day average price. This does not guarantee that the price drop badge will appear, but it does increase the probability. 

5. What is the benefit of using price drop annotations?
A price drop badge increases your product’s ranking as Google prioritizes products with lower costs. This also increases the visibility of your product listings. Additionally, shoppers who are sensitive to pricing are more likely to click on products with the price drop badge, leading to increased sales. 

6. Do price drop annotations apply to sales or temporary discounts?
No. The price drop badge and the sale badge are two different badges with different requirements. The price drop badge will automatically show up for products with considerably lower prices compared to their 60-day average product price. 

A sale badge can be manually added using the sales attribute in the product data feed uploaded to Google Merchant Center. 

7. Can I control when the price drop annotation is shown?
Unfortunately, no. Google will automatically display the price drop badge based on the data you update to Google Merchant Center. While many advertisers have observed that a price drop of 20% or more can trigger the badge to show up, there is no guarantee that it will. 

8. How can I track which products have price drop annotations? 

In your Google Merchant Center account, navigate to the ‘All products’ page. Here, you will find a filter icon. Adding a filter shows specific products. Select ‘Has a price drop badge’ from the list of filters, and you will be shown the products with the price drop badge. 

9. How do I set up a Google Shopping price drop alert? 

To set up a Google Shopping price drop alert, search for the product in the shopping tab. Open the product card and click on ‘Track Price’. 

If there are any significant changes in the price, Google will automatically alert you on your preferred device. 

This feature is only available in India and USA. 

10. Are price drop annotations available in all regions?
Yes, price drop badges are available in all regions where Google Shopping ads are displayed. 

11. What is the impact of price drop annotations on performance? 

Price drop badges have a positive impact on the CTR and conversion rates. It can improve visibility in a competitive space and benefit many sellers targeting price-sensitive audiences.

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