Custom labels can be a great way for you to:

  • A) Tell Google Merchant Center what products to avoid when uploading data
  • B) Set the country in which your products will be sold
  • C) Subdivide products into specific product groups in AdWords
  • D) Identify the shipping method used for your products

Explanation: In a Shopping campaign, you subdivide your products based on existing data from the category, brand, item ID, condition, product type, and custom label attributes. You can use custom labels if you want to subdivide the products in your campaign using values of your choosing

Read more here: https://support.google.com/merchants/answer/188494#customlabel

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