Dive Brief:

• YouTube introduced Shopping ads in a user's home feed and search results, the company revealed in a blog post. The shoppable ad units will be served up based on a user's browsing and search words. Puma is one of the retailers planning to use the format to engage with holiday shoppers.
• Almost two-thirds of consumers said that online video has informed and inspired the decision to make a purchase, according to the Google-owned company's research. Almost all (more than 90%) have discovered new products and brands on YouTube.
• YouTube video ads have also been updated to be more interactive. For instance, users can now click on a video for store location information and interest forms. In addition, coming soon YouTube will allow advertisers to create sitelink extensions for TrueView for action ads, so that advertisers can direct consumers to specific landing pages such as an offer page or a holiday catalog. A beta test with 30 advertisers delivered a 23% conversion jump after adding sitelinks.

Dive Insight:

Shopping ad units have proven successful for Google in search and now the company is bringing the format to YouTube, tapping into how consumers are using video during the shopping journey. For advertisers, a key benefit is being able to extend their existing Shopping campaigns onto YouTube to get in front of more potential customers.

"Consumers are continuing to watch more content on the YouTube platform and we want to be where they are, to reach and engage them," Rick Almeida, VP of e-commerce at Puma Group, said in the blog post. "This new opportunity will enable Puma to extend our shopping strategy into a new property and inspire consumers."

Google also said Showcase Shopping ads, which group related products together, are now available on Google Images so when people search for images, they'll see an ad for a group of related products. These ads are also expanding to new search categories like beauty and electronics. When Urban Outfitters expanded Showcase Shopping ads to 50 categories, it saw a 241% increase in click-thru rates, with 52% of customers being new. Additionally, the retailer saw a 186% increase in sales from new customers, according to the blog post.

The news is the latest example of how Google is trying to make Shopping ads more visually appealing. Last month, Google added user-generated images in product reviews for Shopping ads on mobile to help shoppers feel more confident about their online purchases.

As Amazon poses a growing threat to Google and other platforms thanks to its focus on advertising, one way Google has been trying to combat this threat has been by building out its shopping capabilities. Last month, Google redesigned its e-commerce platform Google Shopping with a bigger focus on personalized content based on a user's habits, as well as with an option to complete purchases through online retailers or at a nearby store.