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You can use custom labels to:

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  • Google Display Advertising Exam – All Q&As
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You can use custom labels to subdivide a product by specific features that you decide

Explanation: With Shopping campaigns, you can use custom labels when you want to subdivide the products in your campaign using values of your choosing. You can use custom labels to indicate that products are seasonal, on clearance, best sellers, etc

Read more here: https://support.google.com/adwords/answer/6275295

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