Below are the recommended steps to run shopping campaigns through AMO ( steps below are broadly written feel free to ask for more details if required).
In order to setup shopping campaign in AMO we should have AMO connected to both Google Adwords and Google Merchant center account. Also, Google Adwords and Merchant center Account should be linked to each other.
Once this is done it is good to create a ACM template in order to automate the process of feed syn and product group creation. After the template is created we should propagate, preview and post this template.
A bulksheet will be created in the bulksheet section and posted to search engine.
Please make sure the Correct GMC is chosen in each ACM template just incase you are running multiple shopping campaigns through templates.
A couple things to note in addition to Ritika's response:
AMO does not connect with GMC directly unless you are using ACM(Advanced Campaign Management) to dynamically manage PLAs. If you are not going to have AMO dynamically manage PLAs, disregard the ACM feature.
Proper AMO tracking needs to be setup 1 of two ways:
Adding a shopping campaign tracking template to the "tracking template" field of AMO
Adding a column in your merchant feed labeled "adwords_redirect" with the URL included in the adwords tracking redirect
If you have any questions about how to implement the tracking by either method, reply here and I will be happy to help.