Automated Bidding Strategies: What, When & Why

The What, When & Why of Google Ads Automated Bidding

There is a range of bidding strategies to help achieve your marketing goals in Google Ads. It’s important to know what their purposes are, plus when and why they should be implemented. Understanding the different types of automated bidding strategies – and if they are right for your business – will assist you in getting profitable leads.

Enhanced CPC

This bidding strategy is suitable for when you want to drive more conversions, but still have full control over bids.

Enhanced CPC is part of Manual CPC bidding, and allows you to have full control over your bids on a keyword, device, time, and location level. It’s basically full control, but also provides some assistance when Google thinks a conversion is likely to occur. Enhanced CPC allows Google to bid up to 20% more on a bid for this purpose.

If you don’t have enough conversion data, then Enhanced CPC is a good place to start.

Enhanced CPC can be used across Search, Display, and Shopping campaigns.

Maximise Conversions

The goal of this strategy is to drive as many conversions as possible within your budget.

It isn’t concerned about your Cost Per Conversion (CPA). It’s objective is to increase conversion volume and it will spend all of your budget to do that.

If you’re already spending your entire budget and don’t have a target CPA in mind, Maximise Conversions is worth doing in order to increase the number of Conversions.

Target CPA

Target CPA bidding is great for when you have a specific Cost Per Conversion goal in mind.

Businesses in the service industry usually work towards a CPA goal, because they know how much an average job is worth, and how much they are willing to spend on advertising to acquire a lead. While it takes away a lot of the bidding control, you can still adjust your CPA targets on an ad group level. This is useful if you have an ad group spending too much with little return – you can lower the target so it spends less. You can make bid adjustments to devices, however, keep in mind this will alter the device’s Target CPA. For all other targeting options, it allows you to add -100% bids to remove a certain targeting completely.

There isn’t a minimum conversion requirement for Target CPA, but it’s recommended you have at least 30 conversions in the last 30 days. The more you have, the more data Google can take into consideration when bidding. It’s important to look back at what your CPA has been over the last 30-90 days and set your goal realistically. If your average CPA is $150, and you set it at $50, the chances of achieving $50 are unlikely, at least in the beginning.

Target CPA can be used in Search and Display campaigns, but not Shopping campaigns.

Target ROAS

This automated bidding strategy is for when you want to acquire conversions with a certain Return-On-Ad Spend (ROAS).

If you need to make $4 back for every $1 you spend in advertising, then your ROAS goal would be 400%. E-commerce stores usually work towards a specific ROAS goal, because with each sale varying in revenue, a specific return is more reliable than a CPA goal.

You need at least 15 conversions in order to use Target ROAS bidding. However, it’s recommended to have at least 50 conversions in the last 30 days – the more the better. We tend to wait until we’ve got at least 2-3 months of solid conversion data before switching over to this.

You can’t make small bid adjustments to devices, locations, or times. But, Target CPA does allow you to add -100% bids to remove a certain targeting completely. For example, you could add a -100% bid to computer devices, so the campaign just focuses on mobiles.

Target ROAS can be used across Search, Display, and Shopping campaigns.

Important Things To Remember

When implementing any bidding strategy it’s important to keep the following things in mind.

  • Know what your conversion goal actually is before choosing a strategy. Is it: Cost Per Lead, Return On Ad Spend, a certain number of Conversions?
  • Set your goals in Target CPA and Target ROAS based on historical conversion data. Understand what is a realistic figure.
  • Let new bidding strategies run their course for at least four weeks. This allows 1-2 weeks in the Learning period, and another two weeks in the Test period.
  • If increasing your targets, don’t go crazy. Adjust these gradually by -/+ 20%, and then review 2-4 weeks later.

Let us know if you need any assistance!

Written by Courtney Wilkinson