Step 3 of 5: Add products to automated discounts

There are 2 ways you can add products to automated discounts:

• Update product details in your data source — This method allows you to set minimum prices and your cost of goods sold (COGS) for individual products. COGS allows automated discounts to give you the most accurate gross profit estimates.
• Select groups of products in automated discounts — This method allows you to add groups of products faster than updating your data source. It allows you to set a maximum discount percentage and a gross profit margin percentage that will be applied to all products that you select. Gross profit estimates will be based on your gross profit margin, which is less accurate than estimates based on your COGS.

If you use both methods to add the same products to automated discounts, your product data source will be used to optimize prices for those products in your Shopping ads.

Requirement to set up automated discounts: Add enough products to automated discounts so their combined impressions account for at least 20% of your total product impressions from Shopping ads.

The more products that you add to automated discounts, the more flexibility automated discounts has to optimize your gross profit.

Update product details in your data source

1. In the “Add products to automated discounts” page, select Update product details in your data source.
2. For each product that you want to add to automated discounts, add the following attributes to product details in your data source. Learn more about how to Manage your data sources.
   • Cost of goods sold (COGS) [cost_of_goods_sold] — Add a value that is 5% to 95% lower than the product’s current price.
     Ensure taxes are applied consistently. If you include sales tax or VAT in COGS, the tax must also be included in the items.price parameter for your conversions with cart data; if not, exclude tax from both.
     Tip: COGS is used to estimate your gross profit and to optimize prices in your Shopping ads. For best results, add COGS to all products in your inventory, which helps automated discounts maximize your gross profit.
   • Minimum price [auto_pricing_min_price] — Add a value that is 5% to 95% lower than the product's current price, but not lower than the product’s COGS.
     In the US and Canada, don’t include sales tax in minimum prices. Outside of the US and Canada, include sales tax or VAT in minimum prices.
     Optimized prices will always be higher than or equal to your minimum prices.
     Tip: Minimum prices are used to optimize prices in your Shopping ads. For best results, add a minimum price that is at least 10% lower than the product’s current price, which gives automated discounts more flexibility to optimize prices and maximize your gross profit.
3. (Optional) To get the most accurate gross profit estimates and reports about your entire inventory, enter a percentage in the Fallback gross profit margin field. This is used when COGS isn’t available for products in your data source.
4. Select Save.

Products in your data source that have minimum prices and COGS will be added to automated discounts. Changes to product details in your data source will be applied within 24 hours.

Select groups of products in automated discounts

1. In the “Add products to automated discounts” page, select Select groups of products.
2. Select a filter from the Find products by drop-down list, then select groups of products by brand, product type, or label that you want to add to automated discounts from the drop-down list next to the filter.

3. In the Gross profit margin field, enter a value from 5%-95%. This is used to estimate your gross profit and to optimize prices in Shopping ads for all products that you select.
4. In the Maximum discount field, enter a value from 5%-40%, but not higher than your gross profit margin. This is used to optimize prices for all products that you select.
5. (Optional) If you want the most accurate gross profit estimates and reports about your entire inventory, enter a percentage in the Fallback gross profit margin field. This is used when COGS isn’t available for products in your data source.
6. Select Save.

The groups of products you selected will be added to automated discounts.

Related link

• Add and remove products in automated discounts