Sep 03 2024

Protecting Ad Spend for Wine & Spirits Retailers :: Part 1

By Mary Berger , Nick Johnston , Travis Box
Wine & spirits are one of the toughest verticals in e-commerce: complex regulations, uneven margins, and highly variable intent. VersaFeed has supported wine merchants for over 15 years, and one pattern is constant—if you don’t monitor ROI and adjust spend in your Google Shopping and other feed channels, you will not generate revenue.
 
In this first part of our series, we’ll focus on protecting your ad budget.

1. Cut Low-Intent Traffic

A common problem: campaigns spending heavily on people who browse high-end bottles but rarely buy. You may see this in:
  • Rising CPCs
  • Low conversion rates
  • Short time on site / high bounce rates
You can’t remove all of this, but you can reduce it:
  • Lower bids or pause products that drive clicks but rarely convert.
    • For Performance Max: place poor converters into their own PMax campaign with a higher ROAS target, or exclude them entirely. Even moving low-performers into their own asset group may help.
    • For Standard Shopping: lower bids (Manual CPC), or increase tROAS / reduce budgets when using Smart Bidding.
  • Watch device and time-of-day performance; in some accounts, certain combinations are consistently unprofitable.
The goal is simple: shift spend toward queries and products that actually generate orders.

2. Exclude the Wrong Products (but keep in the feed!)

Not every bottle belongs in paid campaigns. Use your feed to exclude products (via custom_label or excluded_destination) that don’t fit your online strategy:
  • Value / sub-premium bottles if your store doesn’t ship these or the margins can’t support paid ads, use custom labels to remove from of wasting budget on traffic you can’t monetize.
  • Cult wines and premier crus etc: if they are central to your business and you have depth and strong pricing, advertising them can make sense. However, if you only carry a few and they mainly attract 'research' traffic, consider excluding them or bidding very conservatively—they often generate expensive clicks and very few orders.

Remember though: Google Shopping does offer free clicks as well, so when possible send your entire inventory in the feed, but ensure that you're not actually bidding on low performers via custom_label or excluded_destination.

3. Segment by Price, Margin, and Inventory

The most effective wine merchants don’t just run “all products” campaigns. They structure product feeds so they can control bids by business reality, not just by guesswork.
 
Typical segmentations:
  • Price bands (e.g., under $20, $20–$50, $50–$150, $150+)
  • Margin tiers (low / medium / high)
  • Inventory depth (one-offs vs items you can reliably promote)
  • Channel priority (products that perform well on Shopping vs social vs specialty channels)
In practice, we often use custom labels in the feed to tag each SKU with these tiers. That allows you (or your agency) to:
  • Set higher bids on high-margin, high-inventory products
  • Keep low-margin and one-off items present for coverage, but with lower bids or limited exposure

4. Focus Spend on the Right Locations

For wine merchants, geography is not just about performance—it’s often about legality. (We’ll dive deeper into rules and regulations in Part 4.)

From a pure performance standpoint:

  • Prioritize ZIP codes and regions with strong historic ROAS and higher average order values.
  • Allocate more budget around your physical stores, where omnichannel behavior is strongest.
  • Reduce or exclude regions that consistently generate poor performance.

From a compliance standpoint:

  • Do not advertise in states or counties where you cannot legally ship or sell.
  • Use the most granular geo controls the platform offers to align your ads with where you can actually fulfill orders.

What’s Next

In this Part 1, we focused on where your money is going. In Part 2, we’ll focus on what you’re showing: how to structure titles and images in your product feed so that the right buyers find the right bottles.