Google has consistently been expanding their automated features as they come out with new updates every so often. One of the most common questions we receive from clients is – “Should I be using automated bidding?”
While automation seems like an easy solution in many cases, it most definitely is not when it comes to Google Ads. When it comes to automated bidding, it truly depends on a variety of factors for when you should and should not use this bidding strategy.
In fact, there are many different options for automated bidding tactics within Google Ads itself. Some of these tactics may be useful for your account, while others may completely hinder your results. It’s important to fully understand the various bidding options before you decide to use automated bidding.
Below is a brief outline on the different bidding options within Google Ads to give you an initial overview:
Manual bidding is probably one of the easiest bidding strategies to understand and navigate. With manual bidding, users can adjust the amount that they want to pay per keyword, and these set bids do not change unless the user goes in and increases or decreases them.
There are some disadvantages to manual bidding, however. For one, manual bidding definitely takes a lot of time on the user’s part. You need to constantly monitor the performance of each keyword and adjust bids accordingly, so you are not wasting money paying for keywords that are under-performing. Second, we often cannot see full metrics in a manual bidding report, whereas you are able to see data we have never seen before when you engage in automated bidding.
If you are looking to save time when it comes to running your pay-per-click campaigns, check out some of the automated options that Google provides:
Enhanced CPC is a bidding option that is similar to manual bidding except that Google Ads will automatically adjust the keyword bid based on whether or not the click will lead to a sale or a lead. With Enhanced CPC, you will typically see a higher click-through-rate (CTR) and conversion rate (CRV).
However, you usually see a higher cost-per-click (CPC) in many cases as well. In fact, the CPC may even be higher than what is profitable, so it is important to pay attention to this as you monitor your campaigns.
The Maximize Conversions bidding option is consider a fully automated bidding strategy within Google Ads. Here, you do not set individual bids for keywords, but instead, Google chooses a CPC bid based on the overall goal of the campaign.
While this option is designed to result in as many conversions as possible, it is important to be cautious of your spend here. Google will spend your daily budget no matter what the results are, so keep an eye on your conversions and your cost per conversion to ensure you are spending your ad budget in a profitable way. In addition, it’s important to make sure your conversion tracking is properly working so that you can accurately determine whether this bidding strategy is profitable or not.
Target CPA is another fully automated bidding option that stands for Target Cost Per Acquisition. This bidding option is where the user sets a target cost per conversion, and then Google adjusts the bids accordingly to try and get as many conversions at or under that set conversion rate as possible.
Again, it is important to make sure conversion tracking is properly implemented when running this type of bid strategy. If not, you will never know if this campaign is actually driving real conversions. To run this option, you must have a certain amount of conversions in the last 30 days in order for Google’s algorithm to correctly make decisions. You should have AT LEAST 30-50 conversions in the last 30 days if you are running this bidding option.
Target ROAS is basically the same as Target CPA, except that this bidding option focuses on the return on ad spend instead of the cost per conversion. In this strategy, Google forecasts future conversions and the value of conversions based on past data when they enter the bidding auctions. Bids are adjusted in real-time when it comes to Target ROAS.
The same precautions that you would take for Target CPA remain the same for Target ROAS, including the conversion tracking and spending levels.
Maximize Clicks is basically the same as Maximize Conversions, except it focuses on getting as many clicks as possible – rather than conversions. This is mostly used for brand awareness campaigns or website traffic campaigns.
When it comes to this bidding strategy, it is important to pay attention to your average maximum cost per click (CPC). Google will want to spend your daily budget, so you want to ensure that the campaign is profitable, so that you are not spending more for clicks than you should be.
Target Impression Share
Target Impression Share is one of the newer bidding options that has recently came about within Google Ads. Here, users can set a goal impression share percentage that is similar to setting a Target CPA. With this type of bidding option, you can bid for placements including the absolute top of the page, the top of the page, and anywhere on the page. In addition, you can set a maximum cost-per-click with this type of bidding strategy.
It is advised to pay attention to how much your bids are costing you though, and whether the strategy is actually profitable or not.
Target Search Page Location
Target Search Page Location is a bidding strategy that is ideal for those in very competitive industries or niches. This strategy allows users to show their ads at the top of the first page of results or at the top of search results.
The main issue with this bidding strategy is that it is designed to drive ad impressions in a certain location, rather than focusing on actual campaign performance or profitability.
When Should You Use Automated Bidding?
The above are just a few examples of the various bidding options that you have within Google Ads. There are even more options that have recently come out of beta and are now being implemented across campaigns for a variety of businesses.
The biggest advantage of automated bidding is being able to decide when and where to actually implement these bidding strategies.
When you are choosing a bid strategy for your pay-per-click marketing, look at the results at the campaign level to see if you are hitting your goals or not.