Google has updated its Merchant Center product data specification to include custom labels as a supported attribute for Demand Gen campaigns, expanding a feature that previously applied only to Performance Max and Standard Shopping into a third major campaign type.

What changed, and why it matters

The update, noted today in a LinkedIn post by Adriaan Dekker, extends the official scope of the custom label attributes - numbered custom label 0 [custom_label_0] through custom label 4 [custom_label_4] - to include Demand Gen campaigns explicitly. According to the Google Merchant Center Help Center documentation, custom labels "allow you to create specific filters to use in your Performance Max, Shopping, or Demand Gen campaigns." The phrasing is new. Until this update, the documentation referenced Performance Max and Shopping as the supported campaign types for custom labels, without Demand Gen.

The change is structural. It means advertisers running Demand Gen campaigns can now use custom label values to segment products for both reporting and bidding purposes inside that campaign type. That brings Demand Gen into alignment with Performance Max and Standard Shopping on one of the more flexible product segmentation tools available inside Google Ads.

Why does this matter? Because Demand Gen has been absorbing new capabilities at a notable pace throughout 2025 and into 2026. Google launched four new Demand Gen features for holiday campaigns in November 2025, including inventory type controls and asset uplift experiments. At Google Marketing Live 2026 in May, Google extended Demand Gen to include Google Maps inventory, automotive product feeds, and AI-assisted campaign creation. Adding custom label support completes another piece of that expansion - this time on the product data side rather than the inventory or format side.

How custom labels work technically

The technical mechanics of custom labels have not changed. According to the Merchant Center documentation, each account supports up to 1,000 unique values per custom label attribute, with a ceiling of 5,000 labels total across all five attributes combined. Exceeding those limits carries a specific consequence: products submitted after the limit is reached will have their additional labels ignored for both reporting and bidding purposes. Product group membership for those overflow products will be evaluated as if the extra label was never applied. To correct this, advertisers need to reduce the number of unique labels and then resubmit product data.

The format requirements for the attributes themselves are straightforward. Values must be strings using Unicode characters, with ASCII recommended. Each value can be between 1 and 100 characters in length. The attribute is not a repeated field, meaning only one value can be submitted per attribute per product. If an advertiser wants to apply multiple segmentation dimensions to a single product, separate attributes are used - custom_label_0 for one classification, custom_label_1 for another, and so on up to custom_label_4.

For text feeds, the format is a plain string such as "summer" submitted under the appropriate column header. For XML feeds, the syntax follows the pattern <g:custom_label_0>summer</g:custom_label_0>. Advertisers using the Merchant API should consult the Merchant API resource documentation for the relevant field structure.

A useful detail in the documentation is how feed rules interact with this attribute. According to the Merchant Center Help Center, advertisers can use feed rules to assign custom labels automatically based on values already present in their product data. For example, a rule could automatically apply a custom_label_0 value based on which price range a product falls into - values such as "0-5", "5-10", "10-20", and "20+" could be applied without manual intervention for every SKU. This is particularly practical for large catalogs where hand-labeling products at scale is not feasible.

Five custom labels, five possible dimensions

The five attributes are independent. According to the Merchant Center documentation, each one supports its own definition chosen by the advertiser. The documentation includes a canonical set of example definitions that illustrates the range of practical uses. Custom_label_0 maps to a "Season" definition, with example values of winter, spring, summer, and fall. Custom_label_1 maps to "Selling rate," with best seller and low seller as example values. Custom_label_2 maps to "Price ranges," using 0-5, 5-10, 10-20, and 20+ to segment by price tier. Custom_label_3 maps to "Margin," with low margin and high margin as values. Custom_label_4 maps to "Release year," using year values such as 1998, 2000, 2010, and 2016.

These definitions are entirely advertiser-determined. The documentation is explicit that the definition is not something entered into Google Ads or Merchant Center itself - it is an internal convention the advertiser maintains to ensure consistent labeling. Because the platform treats these values as opaque strings, two different advertisers could both use the value "high" in custom_label_3 and mean entirely different things by it.

The separation between attributes matters at the product level too. For a single product, only one value can be submitted per attribute. The Merchant Center documentation illustrates this with a worked example: a pair of Malibu sunglasses carrying the value "Summer" in custom_label_0, "5-10" in custom_label_2, and "2016" in custom_label_4. Custom_label_1 and custom_label_3 are not set for that product - because the documentation notes that each attribute is optional, and should be included only when it adds value.

Where Demand Gen fits in the product segmentation picture

The expansion connects to a broader pattern in how Demand Gen campaigns have been evolving. Google's 2026 retail ad playbook, covered by PPC Land in April, described how Demand Gen campaigns can now incorporate product feeds from Merchant Center, pulling rich product assets directly into ad formats served on YouTube, Gmail, Discover, and the Google Display Network. Once a product feed is connected, product information is automatically surfaced within those placements, including for shoppable connected TV formats.

Before this update, advertisers connecting product feeds to Demand Gen campaigns could not apply the same product group filters they use in Shopping or Performance Max. Custom labels are one of the primary mechanisms for creating those filters. Adding them to Demand Gen changes the control structure available to retail advertisers running the campaign type.

PPC Land's coverage of Demand Gen ad specs and Demand Gen placements has tracked how the format has evolved from a brand awareness vehicle into one with full product feed integration, targeting controls, and now, product-level segmentation via custom labels. The trajectory is toward parity with the control surface of Shopping campaigns, while preserving the upper-funnel, visual-first character of the format.

For comparison: Google Ads API v24, released April 22, 2026, introduced CartDataSalesView, which lets developers report on what products were actually purchased after an ad click - not just which product was advertised. That kind of post-click product reporting sits alongside the kind of pre-bid product organization that custom labels enable. Together, they represent the two ends of a product-level control loop: segment before the auction, then measure what sold.

Practical implications for campaign structure

Advertisers managing large product catalogs inside Demand Gen will want to think carefully about how to define each of the five labels before populating values at scale. The limit of 1,000 unique values per attribute, and 5,000 across all five, is a hard ceiling without recourse once reached - products submitted beyond it are simply ignored for bidding and reporting until the total is reduced and data is resubmitted.

The most common practical uses for custom labels in Shopping and Performance Max - margin, selling rate, seasonality, price tier, and product lifecycle stage - translate directly to Demand Gen. A retailer running Demand Gen campaigns across YouTube and Discover now has the ability to structure bidding around those same dimensions. A high-margin product set can receive an adjusted bidding target relative to a low-margin set. Seasonal items can be isolated into their own product groups to simplify budget management during peak periods. Clearance products can be separated from full-price inventory to prevent discounted items from suppressing return on ad spend signals.

The documentation note about Display campaigns is worth attention. According to the Merchant Center Help Center, custom labels apply to Performance Max, Shopping, and Demand Gen campaigns only. For Display campaigns with dynamic remarketing, the applicable attributes are the product grouping label for Display ads [ads_labels] and product grouping for Display ads [ads_grouping]. These are distinct from custom labels, and the delineation between campaign types on this point has not changed.

The Merchant Center for Agencies platform, which reached global availability in May 2026, includes a workflow that connects low-traffic product identification directly to custom label creation in Google Ads campaigns. That workflow now has an additional campaign type where those labels can take effect, since Demand Gen is now a supported destination alongside Shopping.

Context: Demand Gen's expanding role in retail advertising

According to PPC Land's analysis of data from the Fospha Q4 2025 study covering 25 retail brands, allocating between 10% and 20% of a Google budget to Demand Gen doubled return on ad spend compared to brands spending under 5% of budget on the channel. That data point preceded the product feed integrations announced at Google Marketing Live 2026. Custom label support represents another incremental step in the same direction - making Demand Gen more manageable for retail advertisers with complex catalogs, not just for brand advertisers with simple creative structures.

Google's internal data from May to June 2025 showed a 33% increase in conversions for advertisers with large product selections - defined as campaigns active since Q1 2024 with more than 50 products in their merchant feed - when those advertisers adopted product feeds in Demand Gen campaigns. That figure was disclosed at Google Marketing Live 2026 and confirmed in multiple subsequent announcements. Custom label support does not by itself drive conversion lift, but it enables the kind of structured bidding approach that makes a large product feed manageable as a performance campaign.

The DV360 API gaining full Demand Gen resource support beginning June 10, 2026 - covering LineItem, AdGroup, and AdGroupAd types - is a parallel development running alongside this product data update. API parity means programmatic management of Demand Gen campaigns is now possible at scale, which in turn makes feed-level attribute management like custom labels more operationally relevant for large advertisers who manage campaigns through automated systems rather than the interface.

Timeline

Summary

Who: Google, through its Merchant Center product data specification documentation, and retail advertisers running Demand Gen campaigns in Google Ads.

What: Google has updated the official specification for custom label attributes (custom_label_0 through custom_label_4) to include Demand Gen campaigns as a supported campaign type alongside Performance Max and Standard Shopping. The update gives advertisers product-level segmentation tools for bidding and reporting inside Demand Gen, with each account supporting up to 1,000 unique values per attribute and 5,000 labels total.

When: The documentation change was noted today, June 28, 2026, surfaced through a LinkedIn post by Adriaan Dekker of the Scale companies with Google Ads newsletter.

Where: The change appears in the Google Merchant Center Help Center under the Custom label 0-4 [custom_label_0-4] product data specification page. The attribute applies across campaigns running in Google Ads, with Demand Gen campaigns serving across YouTube, Discover, Gmail, and the Google Display Network.

Why: Demand Gen campaigns have been progressively absorbing product feed capabilities throughout 2025 and 2026, including Merchant Center feed integration, shoppable formats on connected TV, and product feed expansion to automotive at Google Marketing Live 2026. Custom label support extends the control surface available to retail advertisers, enabling product-group-level bidding decisions - by margin, seasonality, price tier, selling rate, or release year - inside a campaign type that previously lacked that segmentation dimension.