Google Ads Bidding Strategies

Written on 18/05/2020

Google Ads Bidding Strategies

You can have Google Ads bid higher for ads that serve specific business goals, such as expanding brand awareness, increasing site visits, or increasing sales. This course introduces you to the bid options you can use to help achieve certain goals.

Google Ads runs an auction every time it has an ad space to fill — whether that’s on a search results page, blog, news site, etc. Each auction decides which ads will show, at that moment, and in that space.

Your bid puts you in the auction. Without a proper bid, you won’t be placed in the auction. Without being placed in the auction, your ad will not show.

Google Ads gives you several ways to bid for your ads. Depending on which networks your campaign is targeting, and whether you want to focus on getting clicks, impressions, or conversions, you can determine which strategy is best for you.

Two ways to manage your bids

There are two ways to manage your bidding in Google Ads: manual bidding and automated bidding. Manual bidding is where you control the bidding yourself. Automated, is where you let Google Ads do the heavy lifting for you. Let’s take a closer look at each and then dig in on how to pick the best strategy for your business.

Manual bidding

Manual bidding lets you manually set bids at the ad group level, for individual keywords, or for ad placements, so you know you’re bidding for the clicks that mean the most to you.

Imagine you run a hiking club in Vermont. You could use manual bidding to bid higher for keywords like “Vermont hiking” and a different amount for broader keywords like “hiking maps.” 

Automated bidding

With automated bidding you can set a daily budget and then have Google Ads automatically adjust your bids to get the most clicks or conversions possible within your budget.

Let’s say you want to maximize clicks for the low-performing keywords in one of your campaigns, but don’t have time to manually manage each keyword. By adding those keywords to a portfolio and setting a target spend, you allow Google Ads to automatically maximize the bids for you!

Use your goals to determine a bidding strategy

Consider your goals

Each bid strategy is suited for different kinds of campaigns and advertising goals. For the purposes of bidding, you’ll want to consider four basic types of goals, along with your current campaign settings.

  • If you want customers to take a direct action on your site, and you’re using conversion tracking, then it may be best to focus on conversions. Smart Bidding lets you do that.
  • If you want to generate traffic to your website, focusing on clicks could be ideal for you. Cost-per-click (CPC) bidding may be right for your campaign.
  • If you want to increase brand awareness—not drive traffic to your site—focusing on impressions may be your strategy. You can use cost per thousand viewable impressions (vCPM) bidding to put your message in front of customers. You can also use a Target Search Page Location or Target Outranking Share strategy to maximize visibility. 
  • If you run video ads and want to increase views or interactions with your ads, you can use cost-per-view (CPV) or CPM or cost-per-thousand (CPM) bidding.
  • If you run video ads and your goal is to increase product or brand consideration you can use cost-per-view (CPV).

Focus on conversions with Smart Bidding

If you want to focus on conversions, consider using Smart Bidding to take much of the heavy lifting and guesswork out of setting bids. Smart Bidding is a set of automated bid strategies that uses machine learning to optimize for conversions or conversion value in each and every auction—a feature known as “auction-time bidding.” It also factors in a wide range of auction-time signals such as device, location, time of day, language, and operating system to capture the unique context of every search. 

Below are the four Smart Bidding strategies you can use.

  • Target CPA (cost-per-acquisition): If you want to optimize for conversions, you can use Target CPA to help increase conversions while targeting a specific cost-per-acquisition (CPA). Learn more About Target CPA bidding.
  • Target ROAS (return-on-ad-spend): If you want to optimize for conversion value, you can use Target ROAS to help increase conversion value while targeting a specific return-on-ad-spend (ROAS). Learn more About Target ROAS bidding.
  • Maximize Conversions: If you want to optimize for conversions, but just want to spend your entire budget instead of targeting a specific CPA, you can use Maximize Conversions. Learn more About Maximize Conversions bidding.
  • Enhanced cost-per-click (ECPC): If you want to automatically adjust your manual bids to try to maximize conversions, you can use ECPC. It’s an optional feature you can use with Manual CPC bidding. Learn more About ECPC.

Focus on clicks with CPC bidding

If you’re focusing on gaining clicks to generate traffic to your website, there are two cost-per-click bid strategies to consider:

  • Maximize Clicks: This is an automated bid strategy. It’s the simplest way to bid for clicks. All you have to do is set a daily budget, and the Google Ads system automatically manages your bids to bring you the most clicks possible within your budget. Learn more About Maximize Clicks bidding.
  • Manual CPC bidding: This lets you manage your maximum CPC bids yourself. You can set different bids for each ad group in your campaign, or for individual keywords or placements. If you’ve found that certain keywords or placements are more profitable, you can use manual bidding to allocate more of your advertising budget to those keywords or placements. Learn more About Manual CPC bidding.

Focus on impressions 

If you want to focus on impressions, you can try one of the following bid strategies to help maximize visibility. 

  • Target Search Page Location: This is an automated bid strategy that automatically sets your bids to help increase the chances that your ads appear at the top of the page, or on the first page of search results. Learn more About Target Search Page Location bidding.
  • Target Outranking Share: This is an automated bid strategy that lets you choose a domain you want to outrank so that your ad is displayed above that domain’s ads, or shows when that domain’s ad does not. You can set how often you want to outrank that domain, and Google Ads automatically sets your Search bids to help meet that target. Learn more About Target Outranking Share bidding.
  • Cost-per-thousand impressions (CPM): With this bid strategy, you’ll pay based on the number of impressions (times your ads are shown) that you receive on YouTube or the Google Display Network.
  • Cost-per-thousand viewable impressions (vCPM): This is a manual bidding strategy you can use if your ads are designed to increase awareness, but not necessarily generate clicks or traffic. It lets you set the highest amount you want to pay for each 1,000 viewable ad impressions on the Google Display Network. vCPM bidding probably isn’t for you if the goal of your campaign is a direct response from customers, like buying a product or filling out a form. Learn more About vCPM bidding.

Focus on views or interactions (for video ads only)

If you run video ads, you can use cost-per-view (CPV) bidding. With CPV bidding, you’ll pay for video views and other video interactions, such as clicks on the calls-to-action overlay (CTAs), cards, and companion banners. You just enter the highest price you want to pay for a view while setting up your TrueView video campaign. Learn more About CPV bidding.

3 tools to determine your CPC bids:

  1. Bid simulatorBid simulator runs “what-if” scenarios like, “How many more impressions would I have gotten if my bid had been $0.10 higher last week?”
  2. Keyword PlannerKeyword Planner shows you how often some keywords get searched, and gives you cost estimates at a glance.First-page bid estimatesFirst-page bid estimates helps you see how much you may need to bid to put your ad on the first page of Google Search results.

Bidding for ROI

Internet traffic is always changing, so it’s important to re-evaluate your CPC bids regularly. Once you’ve set maximum CPC amounts that you’re comfortable with, see how many clicks your ads begin to accrue, and whether those clicks lead to business results on your website.

When to use automated bidding

Do you have performance goals for your campaigns? 

For instance, do you want to drive as many conversions as possible, within your budget?

Are you ready to free up time spent optimizing existing campaigns?

Studies have shown 80 percent of a marketer’s time is spent manually optimizing campaigns.1 How best could you use this time?

Does your campaign meet our performance recommendations?

You’re likely to get better results if your campaign is already getting at least 15 conversions and 15 clicks per month before you enable automated bidding. This isn’t a requirement, but this kind of data helps the algorithm work its magic.

Do you have conversion tracking enabled?

Though you’ll need conversion tracking enabled to use many automated features, we do have strategies that don’t require this if this isn’t for you. If you’re ready to get started with conversion tracking, see the resources at the end of this course.

When to use manual bidding

If you don’t think you’re a good fit for automated bidding, manual bidding is always an option. You may want to consider manual bidding if:

  • You don’t have enough conversions to meet the recommendations for automated bidding
  • You need 100 percent control of how you pay for views, clicks or conversions

If the descriptions above don’t apply to you, we recommend choosing an automated bidding strategy. Read on to learn how to do just that.

How to choose your automated bidding strategy

You set the automated bidding strategy in Google Ads that best serves your primary campaign goal.Ad clicks

Maximize clicks automatically sets your bids to help get as many clicks as possible within your budget. It can increase site visits and increase clicks on low-traffic terms.

Good for advertisers just starting off with online marketing who are most interested in getting customers to their website.Ad revenue

Target return-on-ad-spend (ROAS) bids more where Google Ads estimates ads are more likely to lead to a sale — aiming to get as much return on ad spend as possible.

Good for advertisers who know the exact value of each conversion to their business.Ad conversions

Automated bidding strategies designed to generate conversions include Enhanced cost per click (ECPC)Maximize conversions and Target cost per acquisition (CPA). We’ll dive into each of these in the following section.

Good for advertisers looking to drive conversions.

Automated conversion bidding types

Enhanced cost per click (ECPC) is a semi-automated bid strategy which adjusts your bids to get you as many conversions as possible, within your determined budget. You set keyword bids and let Google Ads work its magic to improve your campaign’s performance.

Good for advertisers looking for an incremental increase in conversions while still retaining control over their keyword bids.

Maximize conversions bidding automatically sets bids at auction time to get you as much conversion volume as possible within your campaign’s budget.

Good for those with a fixed advertising budget already seeing at least 15 conversions and 15 clicks per month, who do not know how much they should be willing to pay for a conversion (in other words, they do not have a target CPA).

Target CPA automatically sets bids to help get as many conversions as possible at the target CPA you set (some conversions may cost more or less than your target). Target CPA does not operate within a set budget.

Good for advertisers who know how much they’re willing to pay for a conversion and prioritize maintaining a specific cost per conversion over driving conversion volume.

Best practices when using automated bidding

Transition from manual to automated bidding

Assume the automated bidding algorithm will need a couple of weeks to accumulate enough data to make informed predictions. Try to keep campaign changes to a minimum while the algorithm learns how to maximize performance for your goals.Set up conversion tracking

Conversion tracking allows you to see how effectively your ad clicks lead to valuable customer activity, like purchases or newsletter sign-ups. In order to use automated bidding, you’ll need to enable conversion tracking. Review the resources section at the end of the course for steps to do so.Avoid frequent changes to bidding options

Google Ads’ algorithm has to adapt to your changes, so try to make them together and infrequently overall. Try to keep Target CPA goals, ads, and campaign daily budgets fairly steady.Review performance and make improvements

The bid strategy report lets you see how well your bid strategies have performed for key metrics. Use this information to make adjustments to your bid strategies and improve your campaign results.

What is a bid adjustment?

A bid adjustment allows you to raise or lower your bids in certain scenarios. With bid adjustments, you can bid higher to increase the visibility of your ads. You can even adjust bids for devices your users are on, meaning you can bid different amounts for desktop, tablet, and mobile.

Types of bid adjustments

  • DEVICEUse device bid adjustments to show your ad more or less frequently for searches that occur on different devices. You can adjust your bid across mobile, desktop, and tablet to optimize more precisely for each device. 
    For example, if you’re promoting an app, you could raise bids for mobile users to focus on driving app installs, while decreasing your bid for desktop. 
  • LOCATIONUse location bid adjustments to show your ad more or less frequently to customers in certain countries, cities, or other geographic areas.For example, if you own a restaurant, you could raise bids to show your ads more frequently to people nearby.
  • TIME OF DAYUse ad scheduling bid adjustments to increase or decrease your bids on certain days or during certain hours. For example, if you’re a meal delivery service, you could raise your bids from 5-7pm to increase your chances of showing ads to hungry commuters on their way home.
  • TOP CONTENTUse bid adjustments for popular content to increase your ad’s chance of showing on top content on YouTube and the Display Network. When your ad is eligible to appear on this content, Google Ads will use your bid adjustment to raise your bid. For example, you could raise your bids for the hottest new cat video on YouTube. Top content adjustments are recommended for advanced users.
  • TARGETING METHODSUse bid adjustments for topics, placements, and other targeting methods in campaign types that show ads on the Display Network. For example, if you sell luggage, you could increase your bids on travel sites in the Display Network so you’re more likely to show on travel blogs and review sites.Targeting method adjustments are recommended for advanced users
  • REMARKETING LISTS FOR SEARCH ADSUse bid adjustments for remarketing lists in your ad groups if you’d like to show ads more or less frequently to people on these lists. For example, you could increase your bid for those who previously viewed your website in the last 30 days. Remarketing list adjustments are recommended for advanced users
  • INTERACTIONSUse interactions for more control over how potential customers connect with your business. For example, you can increase your bid for mobile devices to show call interaction ads more frequently for mobile phone users. Interaction bid adjustments influence how often you show call extensions and call-only ads to users.

Setting your daily budget

Without a daily budget, you can’t show your ads. Your daily budget is the amount that you set for each campaign to indicate how much, on average, you’re willing to spend per day. Choose a daily budget based on your advertising goals and the general amount you’re comfortable spending. When your average daily budget is reached, your ads will typically stop showing for that day. 

Four tips to help determine your daily budget

Calculate based on your monthly budget

If you’re used to working with a monthly advertising budget, you can calculate the amount you might budget per day by dividing your monthly budget by 30.4 – the average number of days per month.

For example, let’s say you normally spend $1,450 per month on advertising. To figure out your daily budget, you’d divide $1,450 by 30.4 and would get a daily budget of $48.

Note: Due to changes in traffic, Google Ads allows up to 20% more clicks in a day than the budget specifies. However, in any given month, Google Ads never charges more than the average daily budget amount multiplied by 30.4.

Calculate based on your average cost-per-click 

You can choose a daily budget for each campaign based on your advertising goals.

For example, let’s say your cost-per-click is $0.10 on average, and you’d like around 500 clicks per day. You might budget $50 per day.

Using this example, here’s how you’d figure out your daily budget: $0.10 x 500 = $50 per day (cost-per-click x clicks per day = Daily budget)

Find your campaign’s recommended budget

Google Ads shows recommended budgets for campaigns that repeatedly meet their daily budget but have the potential to earn more clicks and impressions. You can use these recommendations to estimate how a new budget may improve the visibility of your campaign’s ads. The recommendations are based on the following factors:

  • * Recent campaign performance
  • * Current campaign budget
  • * Keyword list
  • * Campaign targeting settings

Note: Google Ads won’t display a recommended daily budget if you rarely meet your daily budget, or if your campaign has limited data. If you don’t see a recommended budget, and you know your ads aren’t being shown as often as they could because your budget is limited, you might want to consider raising your budget to an amount that you’re comfortable with.

Check your ad delivery method

When your average daily budget is reached, your ads will typically stop showing for that day. You’ll want to consider your campaign’s ad delivery method, which determines how quickly your ads are shown and how long your budget lasts during a given day, when setting your daily budget.

The “Standard” delivery method is like a slow-burning candle – it spreads your budget throughout the day.

The “Accelerated” delivery method is more like jet fuel – it uses your budget more quickly. Accelerated delivery is ideal for advertisers who want to show results more quickly.