Google quietly introduces custom labels for Demand Gen campaigns

Short Summary: This update marks a significant enhancement for retail advertisers, as it expands the capabilities of Demand Gen campaigns by enabling custom labels. With more precise product segmentation, advertisers can better target audiences, optimize bids, and analyze performance across multiple Google channels. This flexibility supports smarter advertising strategies, improves campaign efficiency, and ultimately drives higher sales. Overall, Google’s move makes Demand Gen a more powerful and versatile tool for online retailers looking to boost their product visibility and customer engagement.

Google has made an important change for online retailers and advertisers. They have updated their rules so that Demand Gen campaigns can now use custom labels. This update is a small but important step in giving advertisers more control over their product ads.

What are custom labels?
Custom labels are special tags that advertisers can add to their product data. These tags help organize and sort products so advertisers can target specific groups of products in their campaigns. For example, an advertiser can create labels like “Summer” for seasonal items or “High Margin” for products with a high profit margin. Previously, these labels could only be used in Performance Max and Standard Shopping campaigns.

What has changed?
The update, announced on June 28, 2026, means that Demand Gen campaigns can now also use custom labels. This brings Demand Gen campaigns in line with other campaign types, giving advertisers more options for targeting and reporting. Now, retailers can segment their products by different labels directly within Demand Gen campaigns to better manage bidding and analyze performance.

Why is this important?
Demand Gen campaigns are becoming more powerful. They are evolving from simple brand awareness ads to include product feeds and targeting controls similar to Shopping campaigns. With custom labels, advertisers can now organize their products by season, price, margin, or release year, and then adjust their bids accordingly. This makes Demand Gen more flexible and helps retailers get better results from their advertising efforts.

How do custom labels work?
Each product can have up to five custom labels (called custom_label_0 to custom_label_4). Advertisers choose what each label means—like “Season” or “Price Range”—and then assign values such as “Summer” or “10-20.” They can use feed rules to automatically assign labels based on product data, making it easier to manage large catalogs.

Technical details

• Up to 1,000 unique values per label.
• A maximum of 5,000 labels across all five labels.
• Labels are strings of text, 1 to 100 characters long.
• Only one value per label per product, but different labels can be used together for multiple classification dimensions.

What does this mean for marketers?
Retailers managing large product catalogs can now organize products better within Demand Gen campaigns. They can segment products by season, margin, price, and more, which helps in setting bids and improving ad performance. This update also allows for more detailed reporting and optimization, especially for campaigns across YouTube, Discover, Gmail, and the Google Display Network.

Summary
Google’s update makes Demand Gen campaigns even more useful for retail advertisers. By supporting custom labels, Google is helping businesses organize their products better and target audiences more precisely. This change allows for smarter bidding and deeper insights, making Demand Gen a more powerful tool in retail advertising.

Who benefits?
Retailers and advertisers using Demand Gen campaigns who want more control over product segmentation and reporting.

When and where?
This change was announced on June 28, 2026, and can be seen in the Google Merchant Center Help Center on the product data specification page.

Why does it matter?
Because it improves the way retailers can organize, bid on, and analyze their products across a variety of Google ad formats, helping them reach customers more effectively and boost sales.

This update is part of Google’s broader efforts to expand Demand Gen’s capabilities, making it a central part of retail advertising strategies.