Google Shopping guide 2026: Merchant Center and Performance Max

How Google Shopping works in 2026

Google Shopping is the product side of Google: the ads with a picture, a price and a store name that appear when someone searches for something to buy. Unlike search ads, you don’t write them or bid on keywords. Google builds them from your product feed, the list of products you send to Merchant Center, and matches them to searches itself.

That makes Shopping a data game. The quality of your feed decides which searches you show for, and your conversion tracking decides how well Google bids.

The three pieces

Merchant Center

Where your products, shipping, returns and business details live. Free. Every Shopping ad and free listing starts here.

Free listings

Your products shown for free across the Shopping tab, Images, Search and Maps. Switch them on; there’s no reason not to.

Shopping ads

Paid placements, run from Google Ads through either a Performance Max campaign or a Standard Shopping campaign. Chapters 05 to 08 cover both.

Where your products show up now

Shopping ads appear on Search, the Shopping tab, Images, YouTube, Gmail, Discover and Maps, and increasingly inside Google’s AI answers:

• AI Overviews. Ads have shown inside AI Overviews in Australia since late 2025.
• AI Mode. Google’s conversational search launched in Australia in October 2025, and ads reached it here on 28 October 2026. Shopping and Performance Max campaigns are eligible automatically. There’s no opt-out and no separate report: AI Mode results are blended into your normal reporting.
• Checkout links. Since July 2026 Australian merchants can let shoppers go from a listing straight to checkout on their own site.

Buying inside Google’s AI (where the customer pays without visiting your site) is US-only for now, with Australia expected in 2027. Good feed data is what gets you into all of these, which is why most of this guide is about it.

Google Merchant Center setup

It’s just Google Merchant Center again: Google dropped the “Next” name in July 2026, and the old classic version is gone. If a guide still talks about Merchant Center Next or the Content API, it’s out of date.

1. Business details. Your legal business name, address, phone and customer service email, exactly as they appear on your website.
2. Verify and claim your website. Through Google Search Console, a tag or your Shopify connection.
3. Shipping and returns. Enter your real delivery costs, delivery times and return policy in Merchant Center. They must say exactly what your website says.
4. Add your products. On Shopify, the Google & YouTube app syncs your catalogue. Otherwise use a scheduled file, a Google Sheet or an integration built on Google’s Merchant API.
5. Link Google Ads and switch on free listings.
6. Fix the diagnostics. Work through the products tab until nothing important is disapproved or limited.

Store quality

Google rates your store on shipping, returns, browsing and the buying experience, and the best stores earn a Top Quality Store badge, which Australian stores can get. You can’t apply for it. Fast, cheap delivery, generous returns, clear policies and good reviews earn it, and changes can take up to a month to show in the rating.

Optimise your product feed

The feed is the targeting. Google reads your titles, descriptions, categories and attributes to decide which searches each product deserves. A product called “The Willow” has no idea what anyone is searching for; one called “Willow Linen Midi Dress, Sage Green, Sizes 6–16” does.

The attributes that matter most

Titles that win

Build titles from the words customers type, not your internal names. A pattern that works for most stores:

• Fashion: Brand + product type + style + colour + size range + material
• Beauty and health: Brand + product + key benefit + size or quantity
• Home and hardware: Brand + product + model + key spec + dimensions

Find the words in your search terms report and in Google’s search box suggestions. Then change titles with a supplemental feed rather than renaming products on your website, test the change on a group of products, and compare clicks and sales after two or three weeks.

Merchant Center suspensions: how to avoid them and how to get back

A Merchant Center suspension stops your Shopping ads and free listings overnight, and a misrepresentation suspension can take your Google Ads account down with it. The most common reason is misrepresentation: Google decided your store might mislead buyers. It rarely says exactly why.

Warning or instant?

What trips the system in practice

Most stores we see suspended aren’t dishonest. They contradict themselves. Check for:

• Contradictory policies. “Free shipping” on the homepage and shipping fees in the policy; “no-questions-asked returns” next to a list of exceptions.
• Shipping times that don’t match. Your website, checkout and Merchant Center should all say the same thing. An old delivery estimate left in a theme is enough.
• Stock that isn’t in stock. Made-to-order or pre-order items marked as in stock.
• Claims you can’t prove. Certifications, “as seen in”, awards, medical or environmental claims, “Australia’s #1”.
• Unclear identity. No business name, address or phone number on the site, or details that differ from Merchant Center and your social profiles.
• Fees at checkout. Any surcharge, handling or restocking fee the customer doesn’t see before checkout.
• Copied or thin content. Supplier descriptions, placeholder text, broken contact forms, empty pages.
• Implied links to other businesses. “Formerly known as” or partner claims that point at a different company.

How to get reinstated

1. Fix everything before you appeal. Audit the whole site against the list above, not just the thing you suspect. Google says failed appeals can limit your ability to appeal again.
2. Make your business identity unmissable. Legal name, address, phone and email in the footer and contact page, matching Merchant Center exactly.
3. Complete any verification Google asks for, including identity checks.
4. Request a review once. Google says account reviews typically take about seven business days.
5. Don’t open a new account for the same business or website. Google treats it as getting around the suspension, and it usually ends worse.

Conversion tracking and profit data

Smart Bidding is only as good as the purchases it’s told about. Get this wrong and Google optimises towards the wrong thing with total confidence.

• One purchase conversion, counted once. On Shopify the Google & YouTube app creates a purchase conversion and sets it as the account’s main goal. Google itself warns to remove old tags from your theme, Tag Manager and custom pixels. Duplicate purchase tracking is the most common fault we find in new accounts.
• Send real values. Order value, consistently with or without GST and shipping, so your ROAS means the same thing every day.
• Turn on enhanced conversions. It sends hashed customer details with each sale and recovers purchases that cookies miss.
• Only purchases as primary. Add to cart and begin checkout can be tracked as secondary conversions, but don’t let Google bid on them.
• Tell Google who your customers are. Upload a customer list (or connect your store) so Google can separate new customers from returning ones. You’ll need it for the Performance Max controls below.

Profit, not just revenue

Add cost of goods to your feed and turn on conversions with cart data, and Google Ads will report gross profit by product and campaign. It’s the fastest way to find products that sell plenty but make you nothing. Google is also testing product value adjustments, which let you tell the bidding to value some products above others.

Performance Max vs Standard Shopping

There are two ways to run Shopping ads, and most stores should use both at some point.

Which one wins when both could show?

Performance Max no longer automatically beats Standard Shopping. Since late 2024, when both could show for the same search, Google picks the one with the higher Ad Rank. A search campaign with an exact-match keyword that matches the query still takes priority over Performance Max. The Low, Medium and High priority setting only ranks your Standard Shopping campaigns against each other.

Feed-only or full Performance Max?

Feed-only Performance Max (products and no images or video) concentrates spend on Shopping placements. Full Performance Max, with your own images and videos, opens up YouTube and Display properly. Experienced advertisers disagree about which is better, and the honest answer is that it depends on your creative. Our default: start feed-led, and add your own images and video once Shopping is profitable, so Google never has to make its own.

AI Max for Shopping

Google is rolling out an AI Max upgrade for Standard Shopping campaigns: ad text written from your feed, wider URL matching and Google choosing between text and Shopping formats. It’s new; test it on one campaign before you switch it on everywhere.

Account structure by spend

Split campaigns only when products need a different budget or a different target. Every split divides the conversion data Google learns from. A campaign with only a handful of sales a month never learns properly.

Under $2k a month

Standard Shopping on maximise conversion value, plus a brand search campaign. Control and clean data while there aren’t enough sales for Performance Max to learn.

$2k–$10k

One Performance Max for all products, brand search, and Standard Shopping for low-traffic products. Keeps the data in one place.

$10k–$50k

Two or three Performance Max campaigns split by margin or performance tier, brand search and a Standard Shopping catch-all. Different targets for different margins.

$50k+

All of the above, plus a new-customer Performance Max and dedicated campaigns for hero products. Room to grow new customers without starving the core.

As a guide, give each Performance Max campaign enough budget for at least 30 purchases a month. Keep product sets separate between campaigns so two campaigns never compete for the same product.

Sort products by how they perform

Within a big catalogue, a few products earn most of the money, many barely get seen, and some eat budget without selling. Tag each product with a custom label every month and treat each group differently:

Stars

Plenty of sales at or above your target ROAS. Give them budget and their own campaign once you’re spending enough.

Steady

Selling, close to target. Leave them in the main campaign.

Spenders

Lots of clicks and spend, few sales. Fix the title, price or page, then cap them in a campaign with a higher target, or exclude them.

Sleepers

Hardly any impressions or clicks. Move them to a Standard Shopping campaign on maximise clicks or a low manual CPC, and bring them back to Performance Max once they’ve earned around 50 clicks.

Performance Max controls you now have

A lot of Performance Max advice online dates from when it was a black box. It isn’t any more. In 2026 you can:

• Add negative keywords at campaign level, up to 10,000 per campaign. They apply to Search and Shopping placements.
• Exclude your brand from Search placements, with a box to keep showing branded Shopping ads if you want them.
• Exclude your existing customers using a customer list.
• See spend and results by channel in the channel performance report: how much went to Shopping, Search, YouTube and Display.
• See search terms in a search terms report, much like a search campaign’s.
• See results by asset group and by asset.
• Exclude placements, ages and devices.
• Switch off final URL expansion, so Google only sends people to the product pages in your feed.

Defaults to check right now

• Image extraction. From 4 December 2026, new Performance Max campaigns pull images from your landing pages by default. Check what it picks, and opt out if your pages carry images you wouldn’t run as ads.
• Auto-applied promotions. Since October 2026 Google can turn promotions it finds on your website into promotion assets. Make sure expired sales don’t get picked up.

Bidding, budgets and the learning period

1. Start on maximise conversion value with no target. Standard Shopping can do this too since mid-2026. Let Google find its feet for two to four weeks.
2. Add a target ROAS once the campaign is getting around 30 purchases a month, set close to what it’s actually achieving. A target far above reality just stops it spending.
3. Move the target in small steps. One change per conversion cycle (the time your customers usually take to buy), then wait.
4. If it won’t spend, loosen first. Lower the target by 10–20% before you touch anything else.

How learning works now

Google’s own guidance changed in October 2026. A campaign shows “Learning” for no more than seven days, but performance can take one to two conversion cycles to settle after a change. Judge results over at least two weeks or two conversion cycles, whichever is longer. Budget changes take effect straight away and don’t restart learning; target changes do.

Set the budget so the target does the work

Set a daily budget a little above what you expect to spend, and use the ROAS target as your real control. A campaign that’s “limited by budget” at a profitable ROAS is telling you to give it more.

Brand traffic and new customers

Left alone, Performance Max loves searches for your own brand and people who’ve already bought from you. They convert brilliantly, so the reported ROAS looks great, but many of those sales would have happened anyway.

Brand

Run a separate brand search campaign so you control what you pay for your own name. Whether to also exclude your brand from Performance Max is one of the most argued points in Google Ads. Our view: if brand searches make up a big share of Performance Max’s sales, exclude your brand and let the brand campaign handle it. If they’re a small share, or the account has few sales, leave them in for the data. Check the search terms report either way.

New customers

Performance Max has a customer acquisition setting with two modes:

New customer value

Bids for everyone, but values a new customer more by an amount you set. Good for most brands.

New customers only

Only bids for people Google thinks haven’t bought before. Use it in a dedicated prospecting campaign.

Either way, the reported conversion value includes the bonus you added, so judge the campaign on the original conversion value and on how many new customers it brings in, and expect a lower reported ROAS.

Measuring what’s really working

• Channel report, weekly. What share of spend went to Shopping versus YouTube and Display, and what each returned.
• Profit, not revenue. With cost of goods in the feed, compare gross profit to ad spend by campaign and product.
• New customers. Is Google growing the customer base, or recycling your existing one?
• MER. Total revenue divided by total ad spend, across every channel. Google and Meta both take credit for the same sale; MER doesn’t double count.
• Lift tests. Google’s conversion lift tests now start from around US$5,000 in spend. For smaller accounts, pausing a campaign in some regions and comparing works too.

The MER calculator works out your break-even and target MER from your margins.

What do Google Shopping ads cost in Australia?

You pay per click, and the price is set by an auction, so it varies by category, season and competition. There’s no reliable Australian benchmark for Shopping costs: the figures you’ll find online are mostly US search data relabelled. Work it out from your own numbers:

The example is illustrative, not a benchmark. Plug in your own click costs from Keyword Planner or a short test, your site’s conversion rate and your margin. Shopping usually costs less per click than text search ads and converts well, because the shopper has already seen the product and the price.

Common Google Shopping mistakes

• Counting purchases twice. An old tag plus the Shopify app makes every campaign look profitable.
• Lazy titles. Product names instead of the words people search.
• Launching Performance Max with no data and no creative. It spends on YouTube and Display while it learns.
• Too many thin campaigns. Splitting by category with the same target just starves each one of data.
• Targets set too high. A target ROAS far above reality stops a campaign spending.
• Overlapping product sets. Two campaigns chasing the same product.
• Trusting brand-inflated ROAS. Check how much of the result is people who already knew you.
• Inconsistent policies. The fastest route to a misrepresentation suspension.
• Leaving defaults on. Final URL expansion, image extraction and auto-applied promotions all deserve a decision.

Where Shopping fits with your other channels

Shopping catches demand that already exists: people searching for what you sell. Channels like Meta and TikTok create that demand in the first place, and when they’re working your branded and product searches rise. Our TikTok ads guide and Meta ads guide cover that side. Judge the whole mix on MER, because every platform takes credit for the same sale.

Google Shopping quick-start checklist

Run your own account against these twelve before you scale. Your ticks are saved on this device.

Thanks for reading, and I hope that helps. If you’d rather hand it over, this is how we run Google Ads for eCommerce brands. And if you just want a second pair of eyes on your own account, that’s what the call is for.

Sam Despo

Founder & Director, Pulp Digital