Hey Roy, love your posts and had a question about Google Merchant Center feed structures. What makes a good feed structure? Is there a preferred feed structure that you think is best that provides the most useful information for success in AdWords?
There are three major components that really affect how your feed performs, structurally (that is, aside from the content of the titles and descriptions themselves which I'll cover in a future blog post).
First, where appropriate, use product groups, with parent and child products, where you have variants of a single product (by size, color, etc.). This expands the ways that Google can match your products against specific semantic searches ("XL gray waterproof jacket").
Second, the Product Type field is totally free to use however you'd need for specific attributes of your catalog. One of the common and more effective ways that I've seen the Product Type field is to emulate the merchandising decisions that went into your site's navigation.
Third, Custom Labels are a huge advantage. Price tiers are the first thing I use them for, but they're also handy for color, size, gender information, where applicable, as those dimensions can often uncover a level of distinct behavior above the individual SKU level.
The advantage to using the product group is that it increases your relevance for searches for the child products--such as "size 9 boating shoes" or "gray sailing vest". Further, it gives you the opportunity to split those variants out within the bidding taxonomy (provided you also pipe that data into custom_labels, or additional values in the product_type chain), which can be helpful if some versions carry a different conversion rate.
For example, a client who sells t-shirts split out both color and size, as some colors are vastly more popular, and sometimes the less common sizes will convert better (say, if you're trying to find an XS or XXXL), given the relatively weak competition for those segments.
Thanks for the question. If you have any additional questions about feed structures, Google Merchant Center, AdWords or really anything e-commerce feel free to drop me a line.
Up and to the right,