Google Ads Bidding Strategies: The Ultimate Guide

This bid strategy allows you to set a target cost per action (CPA) for your campaigns and ad groups. The system will automatically adjust your bids to try to achieve that target CPA. This bid strategy is best for advertisers who want to optimize conversions and want to minimize the time and effort required to manage bids manually. To use this strategy, advertisers need to have conversion tracking set up in their advertising account, which helps track the conversions and provide data for the bidding algorithm. Based on this data, the algorithm will adjust bids in real-time to maximize the chances of achieving the desired target CPA.

Pros
Allows you to set a target cost per action for your campaign and automatically adjust bids to achieve that target. This can help you achieve a consistent cost per acquisition over time and can be a good strategy for businesses that want to focus on conversions and lead generation.

Cons
Can be less effective in driving traffic and can lead to fewer conversions if the target CPA is set too high.

Target ROAS is a bid strategy that enables you to set a target return on ad spend (ROAS) for your campaigns and ad groups. The system will automatically adjust your bids to achieve that target ROAS. This bidding approach is ideal for advertisers who want to optimize their ad spend and achieve profitability.

Pros
Allows you to set a target ROAS for your campaign and automatically adjust bids to achieve that target. This can help you achieve a consistent return on your advertising investment over time and can be a good strategy for businesses that want to focus on revenue and profitability.

Cons
Can be less effective in driving traffic and can lead to fewer conversions if the target ROAS is set too high.

Maximize Conversions bidding is designed to help you optimize your Google Ads campaigns towards getting more conversions, which are customer actions that are valuable to your business, such as sales or leads. With this bidding strategy, you can let Google Ads automatically adjust your bids in real-time to try to maximize the number of conversions you get, while staying within your budget.

One way to use Maximize Conversions is to set a Target CPA, which is the average amount you want to pay for each conversion. When you set a Target CPA, Google Ads will try to get as many conversions as possible at that cost per conversion, using machine learning algorithms to adjust your bids accordingly. This can be a good option if you have a specific cost-per-acquisition goal in mind, and you want to let Google Ads handle the bidding to try to hit that goal.

If you don't set a Target CPA, then Maximize Conversions will simply aim to spend your budget as efficiently as possible to get as many conversions as possible, without taking into account a specific cost-per-acquisition target. This can be a good option if you're more focused on maximizing your conversion volume, rather than hitting a specific cost-per-acquisition goal.

Overall, Maximize Conversions can be a powerful bidding strategy if you're looking to optimize towards getting more conversions in your Google Ads campaigns, and you're willing to let Google Ads use machine learning to handle your bids for you. Just keep in mind that this strategy works best when you have enough historical conversion data in your account for Google Ads to learn from, and that you may want to consider other bidding strategies if you're just starting out or have very limited conversion data.

Pros
Automatically adjust bids to maximize the number of conversions for your campaign. This can be a good strategy for businesses that want to focus on conversions and lead generation.

Cons
Can be more expensive than other strategies if the conversion rate is low.

With Maximize Conversion Value bidding, the goal is to get as much conversion value as possible, while staying within your budget. This strategy is best suited for businesses that want to maximize the revenue or profitability of their campaigns, by focusing on the value of each conversion, rather than just the volume.

To use Maximize Conversion Value bidding, you'll need to set a conversion value for each conversion that you're tracking in your Google Ads account. This can be done using conversion tracking or by importing transaction data from your website or CRM. Once you have conversion values set up, Google Ads will use machine learning to adjust your bids in real-time, to try to get as much conversion value as possible, while staying within your budget.

One important thing to keep in mind is that Maximize Conversion Value bidding may not always be the best strategy for your business, depending on your goals and the types of conversions you're tracking. For example, if you're focused on driving leads or sign-ups, rather than direct sales, you may still want to use Maximize Conversions bidding, even if you have conversion values set up. It's always a good idea to test different bidding strategies and measure their performance, to find the one that works best for your business.

Pros
Automatically adjust bids to maximize the total value of conversions for your campaign. This can be a good strategy for businesses focusing on revenue and profitability.

Cons
Can be more expensive than other strategies if the conversion value is low.

This bid strategy allows you to set a target impression share for your campaigns and ad groups. The system will automatically adjust your bids to achieve that target impression share. This bidding plan is recommended for those wanting to optimize for visibility and minimize the time and effort required to manually manage bids.

Pros
Set a target impression share and automatically adjust bids to achieve it. Good for visibility and brand awareness.

Cons
More expensive than other strategies if target impression share is set too high.

This bid strategy automatically sets bids to help get the most clicks for your campaigns while spending your budget. The system will automatically adjust your bids to maximize clicks based on the historical performance of your campaigns and ad groups.
Here are some examples of when advertisers might use the Maximize Clicks bidding strategy:

1. When the primary goal of the advertising campaign is to drive website traffic or increase ad visibility.
2. When the advertiser has a limited budget and wants to make the most of it by getting as many clicks as possible.
3. When the advertiser is testing new ad copy or targeting options and wants to quickly gather data on ad performance.
4. When You running a time-sensitive promotion or event and want to drive as much traffic as possible during a specific time period.
5. When needs to focuse on increasing brand awareness and to maximize ad exposure.

Pros
Set a target impression share and automatically adjust bids to achieve it. Good for visibility and brand awareness.

Cons
More expensive than other strategies if target impression share is set too high.

This bid strategy automatically adjusts your manual bids for clicks that are more likely to lead to a conversion. This bidding strategy is fitting for advertisers looking to optimize for conversions while still maintaining control over their bids.

Pros
Automatically adjust bids for clicks that are more likely to lead to conversions. This can help you increase conversion rates and reduce the overall cost per conversion.

Cons
It may increase the overall cost per click if there are not enough conversion signals or if the algorithm is not able to identify them.

This bid strategy allows you to manually set your bids for each auction. This bid strategy is best for advertisers who want the most control over their bids and want to be able to make adjustments based on specific circumstances.

Pros
Allows you to manually set bids for your campaign. This can give you more control over your costs and can be a good strategy for businesses that want to closely monitor their advertising spending.

Cons
It requires more time and effort to manage the bids and it can be difficult to achieve consistent results without constant monitoring.

This bid strategy allows you to set a target cost per thousand impressions (CPM) for your campaigns and ad groups. The system will automatically adjust your bids to achieve that target CPM. This bidding mechanism is fitting for advertisers wanting to optimize for visibility and minimize the time and effort required to manually manage bids.

Pros
Allows you to set a target cost per thousand impressions (tCPM) for your campaign and automatically adjust bids to achieve that target. This can help you achieve a consistent cost per thousand impressions over time and can be a good strategy for businesses focusing on visibility and brand awareness.

Cons
Can be more expensive than other strategies if the target tCPM is set too high.

This bid strategy allows you to bid on ad impressions that are likely to be viewed by users. This bidding approach is recommended for those hoping to optimize for visibility and minimize the time and effort required to manually manage bids.

Pros
Allows you to pay for ad impressions that are viewed by users. This can help you increase the visibility and effectiveness of your campaign.

Cons
More expensive than other strategies if target vCPM is set too high.

This bid strategy allows you to bid on ad views. This bid strategy is best for advertisers who want to optimize for visibility and want to minimize the time and effort required to manage bids.

Pros
Allows you to pay only when a user views your ad. This can help you increase the visibility and effectiveness of your campaign.

Cons
Can be more expensive than other strategies if the viewability rate is low.

The Portfolio bid strategies is a new feature that was introduced by Google Ads.

Portfolio bid strategies allow you to set a bid strategy at the portfolio level (a group of campaigns or ad groups) instead of having to set a strategy for each campaign or ad group. This feature allows you to manage multiple campaigns and ad groups more efficiently, by giving you a single point of control over bid strategy. The system will automatically adjust your bids to achieve your portfolio-level goals such as CPA, ROAS, Impression share, clicks, and conversions.

This strategy is best for advertisers who have multiple campaigns and ad groups, and want to manage them more efficiently with a single point of control over bid strategy. It also allows you to set different goals for different campaigns and ad groups, such as maximizing conversions for one campaign and maximizing clicks for another, and the system will adjust bids accordingly.

It also allows you to set specific targets for each campaign or ad group, and the system will automatically optimize bids to reach those targets.

To change the bid strategy in Google Ads, you can follow these steps:

1. Log in to your Google Ads account.
2. Click on the "Campaigns" tab on the navigation menu.
   
3. Select the campaign or ad group that you want to change the bid strategy for.

4. In the "Settings" section, click on the "Bidding" subtab.
5. In the "Bidding" section, you will see the current bid strategy and the option to change it.

6. Click on the "Change bid strategy" button.
7. Select the bid strategy that you want to use from the list provided.
8. If you are using Target CPA, Target ROAS, Maximize Conversions, Maximize Conversion Value, Target Impression Share, Maximize Clicks, and Enhanced CPC, you will be prompted to enter a target or set a bid limit.
9. Click on the "Save" button to apply the changes.

Keep in mind that, depending on your account structure and settings, the interface may look slightly different but the process should be similar.

Unfortunately, all the bidding strategies have various limitations. For instance, manual bidding is laborious and time-consuming. Moreover, accurately tracking all Google advertising trends and changes to make informed decisions is almost impossible.

Smart and automated bidding strategies aren't without challenges either. First, they take over control of the campaign. Therefore, you no longer control the decision-making data. Similarly, you have almost no control over the budget, especially in smart bidding.

Worse still, some marketers complain that Google's smart bidding bots often use broad keywords that don't accurately depict the target audience. Again, this can result in lost revenue.

Finally, smart bidding involves a long learning cycle. It involves machine learning and typically makes predictions based on past performance. But what if the past assumptions are off?

For example, we've already seen that the algorithms can inaccurately depict your target audience. Your campaign is ruined for the foreseeable future if this happens.

Given the various challenges, savvy marketers use smart tools like ANDATA for auditing PPC campaigns to determine the best ad bidding strategy.

ANDATA.io is an Artificial Intelligence (AI)-powered Google Ads PPC auto-optimization tool that lets you test different Google Ad bidding strategies and combine the best methods to suit your business and PPC campaign needs.

You have the following options:

Manual CPC is ideal for advertisers with sufficient data who desire maximum control over their ad campaign and want to receive predictable results.

How Does it Work?

A manual CPC setup allows you to set the maximum bid for specific keywords at an auction. However, the cost per click (CPC) is often much lower than the maximum bid.

Pros

• Low barriers to entry
  
• No pre-conversion tracking needed
  
  

Cons

• Time intensive
  
• Lack of relevant data
  
  

When to Use

We recommend a manual CPC setup when launching a new campaign. Manually setting the CPC at the campaign onset allows you to understand the hills and valleys of the new campaign better. Also, consider manual bidding if you're not primarily invested in conversions.

We recommend leveraging intelligent bidding tools to complement manual processes such as Andata.

How Does it Work?

Think of optimized CPC campaigns as semi-automated versions of manual campaigns. You set the maximum CPC manually but allow our algorithms to adjust actual bids automatically based on contextual signals, including search queries and changing conversion goals.

Pros

• Full control over the maximum CPC
  
• Increased conversions due to smart bid adjustments
  
• Reduced labor
  
  

Cons

• The maximum CPC limits your conversions
  
• You must regularly check and adjust the maximum bid
  
  

When to Use It

Optimized bid strategies work best to enhance an existing manual campaign. However, you can also use it to create a new campaign inside an existing account.

This type of smart PPC advertising focuses on gaining maximum conversions rather than clicks or views.

How Does it Work?

The maximum conversions set up permits ANDATA to incorporate real-time auction factors, including search history, visitor behavior, and buyer intentions, to determine the "perfect" bid for the specific visitor. So, instead of setting a maximum bid, you provide a daily budget, and the algorithms set the bids.

Pros

• Uses real-time data
  
• Eliminates most manual tasks
  
• Maximizes conversions
  
  

Cons

• It may misrepresent PPC indicators
  
• It can be expensive
  
  

When to Use It

This approach best suits advertisers willing to spend more to maximize profitability. It's also ideal for businesses with longer customer lifetime values.

In conclusion, Google Ads provides a variety of bid strategies for advertisers to choose from. Each bid strategy has its benefits and is best suited for different advertising goals.

Choosing the right bid strategy can help you optimize your campaigns and ad groups for conversions, return on ad spend, visibility, clicks, conversion value, and more. It's essential to understand the goals of your campaign and ad groups and to choose a bid strategy that aligns with those goals.

Google PPC advertising can be intimidating, even for experienced professionals, and setting up a bidding strategy is one of the biggest challenges. But not anymore. With AI-powered tools like ANDATA, you can let machine learning do the hard work while you focus on fine-tuning the campaign. Please request a free-of-charge audit for your Google Ad campaigns below.