Automated bidding is a feature that allows Google Ads to automatically set bids for ads on your behalf, based on how likely Google thinks those ads will result in a desired action, such as a conversion. It’s a tool that can significantly simplify the process of setting bids, but automated bidding still requires an advertiser’s guiding hand to truly be effective.

Let’s briefly discuss how automated bidding works. Then, we’ll walk through the types of automated bidding strategies, and share some tips and tricks that will help you to make the most of this powerful tool.

How Automated Bidding Works

Automated bidding uses machine learning and a variety of signals (such as time of day and operating system), to establish a bid for a specific query. These signals are used to determine whether your ad is a good match to a particular search, and, if it is, how much should be bid in the auction to show your ad.

Types of Automated Bid Strategies

• Maximize Clicks: If your goal is to increase visits to your website, this is the strategy for you.
• Maximize Conversions: This strategy’s objective is to get as many conversions as possible within your budget.
• Maximize Conversion Value: Bids will be set with the goal of maximizing your conversion value within your budget.
• Target CPA: The goal here is to maximize conversions at your desired target Cost-Per-Action.
• Target Impression Share: This strategy is focused on increasing ad visibility and brand awareness.
• Target ROAS: This strategy works to meet a target Return on Ad Spend while helping you get as much conversion value as possible.

Make the Most of Automated Bidding

Here are some ways you can ensure that you’re fully optimizing your automated bid strategies.

Create a Portfolio Bid Strategy: Portfolio bidding allows you to apply a bid strategy to multiple campaigns, ad groups, and keywords, which can come in handy when you want to optimize bidding across multiple campaigns quickly. This type of bid strategy also allows you to set both a Target CPA and Max CPC, something that isn’t possible at the campaign level.

Start with Manual Bidding or Maximize Clicks: For many businesses, the ultimate goal is to maximize conversions, and so you may be inclined to start with an automated bidding strategy that aligns with this objective. However, maximize conversions uses historical data to find an optimal bid for your ad. The less it has, the more it will need to test in order to determine what results in a conversion. It’s also worth noting that the maximize conversions bidding strategy will do its best to fully spend your daily budget.

All of this means that a maximize conversion strategy will likely result in a spike in spend and some pretty high CPAs while Google works to learn what is effective. To mitigate this, consider testing manual bidding or maximize clicks first. This will give Google more data that it can use when you do eventually switch over to maximize conversions.

Help Google Where You Can: If you have a target ROAS for your business, provide that amount to Google. Likewise, if you have a certain CPA that you would like to maintain, provide a target CPA. Tell Google how much different products and conversions are worth, so that it can work with an accurate conversion value. All of these things will help Google better understand the needs of your business, and, in turn, help automated bidding spend more effectively.

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Our agency will help your e-commerce business thrive. Interested in learning more about automated bidding? Contact Relevance Advisors today to schedule a consultation.