Maximizing Your Ad Spend: An Introduction to 5 Smart Bidding Strategies in Google Ads
  • January 17, 2023
  • PPC

Maximizing Your Ad Spend: An Introduction to 5 Smart Bidding Strategies in Google Ads

Are you looking to maximize your ad spend and reach your business goals with Google Ads? Look no further than smart bidding strategies. These automated techniques use machine learning to optimize your bids for conversions, revenue, and more.

Google Ads offers a variety of automated bidding strategies, known as smart bidding, that can help you optimize your campaigns for conversions, revenue, and more.

In this post, we will explore 5 different types of smart bidding strategies, including Target cost per action (CPA), Target return on ad spend (ROAS), Maximize Conversions, Maximize Conversion Value, and Enhanced cost per click (ECPC).

We will also provide specific examples of when to use each strategy to help you get the most out of your Google Ads campaigns. Whether you’re looking to drive conversions, increase revenue, or simply reach more people, smart bidding can help you achieve your goals.

  1. Target cost per action (CPA): Target CPA is a smart bidding strategy that helps increase conversions while targeting a specific cost per action (CPA). This strategy uses machine learning to adjust bids in real-time to reach the target CPA you set. For example, if you’re running a campaign for a new product launch and you want to acquire 100 new customers at a CPA of \$50, you can use Target CPA to help reach this goal.

  2. Target return on ad spend (ROAS): Target ROAS is a smart bidding strategy that helps increase conversion value while targeting a specific return on ad spend (ROAS). This strategy uses machine learning to adjust bids in real-time to reach the target ROAS you set. For example, if you’re running a campaign for a luxury product and you want to generate $10,000 in revenue while spending $5,000 on ads, you can use Target ROAS to help reach this goal.

  3. Maximize Conversions: Maximize Conversions is a smart bidding strategy that automatically sets bids to maximize the number of conversions within your budget. This strategy uses machine learning to adjust bids in real-time to help you get the most conversions possible. For example, if you’re running a campaign for a limited-time sale and you want to drive as many conversions as possible before the sale ends, you can use Maximize Conversions to help reach this goal.

  4. Maximize Conversion Value: Maximize Conversion Value is a smart bidding strategy that automatically sets bids to maximize the total value of conversions within your budget. This strategy uses machine learning to adjust bids in real-time to help you get the most revenue possible from conversions. For example, if you’re running a campaign for a high-end product and you want to generate as much revenue as possible from conversions, you can use Maximize Conversion Value to help reach this goal.

  5. Enhanced cost per click (ECPC): Enhanced CPC is a smart bidding strategy that automatically adjusts your manual bids to try to maximize conversions. It is an optional feature you can use with Manual CPC bidding. This strategy uses machine learning to adjust bids in real time based on the likelihood of a click leading to a conversion. For example, if you’re running a campaign for a new service and you want to drive conversions while keeping costs under control, you can use ECPC to help reach this goal.

It is important to note that these strategies can be used in different combinations and at different levels of your campaigns. For example, you may use a Target CPA strategy at the campaign level and a Maximize Conversions strategy at the ad group level. It’s also important to test and monitor the performance of your bid strategies to ensure that they are working effectively. With the right smart bidding strategy and proper monitoring and adjustments, you can optimize your Google Ads campaigns and reach your business goals.

What is automated bidding?

Automated bidding, also known as smart bidding, is a powerful tool in Google Ads that allows you to set a specific goal for your campaigns and have the system automatically adjust bids to help you reach that goal. With the help of machine learning, Google Ads can analyze data from your account and other signals, such as device and location, to adjust bids in real-time. This allows you to optimize your campaigns and reach your goals with minimal manual effort.

What are the benefits of using google ads bidding strategies?

There are several benefits of using Google Ads bidding strategies, including:

  1. Increased efficiency: Automated bidding can save you time and effort by automatically adjusting bids for you, allowing you to focus on other aspects of your campaigns.

  2. Improved performance: Smart bidding strategies use machine learning to analyze data from your account and other signals to optimize bids in real time, which can lead to improved performance for your campaigns.

  3. Better cost control: Strategies like Target CPA and Target ROAS allow you to set a specific cost or return on investment goal and have the system optimize bids to reach that goal, giving you better control over costs.

  4. Increased conversions: Strategies like Maximize Conversions and Maximize Conversion Value are designed to help increase conversions and revenue respectively, which can help drive business growth.

  5. Increased reach: Target Impression Share helps to increase the reach of your ads to more people and gives you more chances to convert them.

  6. Better targeting: Flexible bid strategies allow you to set a bid strategy for your campaign, but also allow you to adjust bids for specific ad groups or keywords, giving you more control over who sees your ads.

Here are some examples of how using Google Ads bidding strategies can benefit your campaigns:

  • A retail business that wants to increase online sales can use Target CPA to drive conversions at a specific cost, resulting in a higher return on investment.

  • A B2B company that is selling a high-end product can use Target ROAS to drive revenue at a specific return on ad spend, resulting in a higher profit margin.

  • A non-profit organization that wants to increase donations can use Maximize Conversions to drive as many donations as possible within their budget, resulting in more funding for their cause.

  • A SaaS company that wants to acquire new customers can use Maximize Conversion Value to drive the most revenue possible from new customer acquisitions, resulting in a higher lifetime value per customer.

  • A local business that wants to increase foot traffic can use Target Impression Share to ensure that their ads are shown to as many people as possible in the area, resulting in more customers.

Is a manual bidding strategy still worth it today?

Manual bidding is still a viable option in Google Ads today, but it may not always be the best choice depending on your goals and resources.

One of the main benefits of manual bidding is that it gives you full control over your bids, which can be useful if you have a deep understanding of your target audience, conversion rates, and other metrics. Manual bidding also allows you to adjust bids based on external factors, such as changes in the industry or market conditions.

On the other hand, manual bidding requires a significant investment of time and effort to monitor and adjust bids on a regular basis. It also requires a deep understanding of how to optimize bids for conversions and revenue.

If you have the time, resources, and knowledge to effectively manage your bids manually, then it can be a worthwhile strategy. However, if you have a limited budget or limited resources, automated bidding strategies like smart bidding can be a more efficient and effective way to optimize your campaigns and reach your goals.

Additionally, Smart bidding strategies use machine learning to analyze data from your account and other signals to optimize bids in real-time, which can lead to improved performance for your campaigns. And also it can help you to save time and effort by automatically adjusting bids for you, allowing you to focus on other aspects of your campaigns.

In summary, manual bidding can be a useful option for some businesses, but it may not always be the best choice, especially if you have a limited budget or limited resources. Automated bidding strategies like smart bidding can be a more efficient and effective way to optimize your campaigns and reach your goals.

What automated bidding strategy should I start with if I’m new to Google Ads?

If you’re new to Google Ads and are looking to start using automated bidding strategies, I would recommend starting with the Maximize Conversions strategy. This strategy is designed to automatically set bids to maximize the number of conversions within your budget. It uses machine learning to adjust bids in real-time based on the likelihood of a click leading to a conversion.

This strategy is a good starting point for several reasons:

  1. It’s easy to set up: The Maximize Conversions strategy is easy to set up and requires minimal configuration.

  2. It’s flexible: This strategy can be used for any type of campaign, including sales, lead generation, and more.

  3. It’s a good starting point: This strategy can help you quickly drive conversions and understand the performance of your campaigns, which can help inform future bid strategy decisions.

  4. It’s highly effective: Maximize Conversions is designed to drive as many conversions as possible within your budget, which can help increase revenue, acquire new customers, and more.

Once you have a good understanding of how the Maximize Conversions strategy works, you can then experiment with other automated bidding strategies such as Target CPA, Target ROAS, Maximize Conversion Value, and Enhanced CPC to see which one works best for your business.

It’s also important to keep in mind that these automated bidding strategies should be constantly monitored and tweaked as needed to ensure they are working effectively. As you gain more experience with Google Ads, you can also adjust your bids and strategies according to your goals, audience, and budget.

What are the requirements for launching a campaign with smart bidding?

To launch a campaign with smart bidding, there are several requirements that you should meet:

  1. Ad campaign: You need to have an active ad campaign in place, with ad groups and ads set up.

  2. Conversion tracking: Smart bidding strategies rely on conversion data to make bid adjustments, so you need to have conversion tracking set up for your website.

  3. Data: You need to have sufficient data for the system to learn from. This means that your campaigns should have at least 15 conversions in the past 30 days to use Target CPA, Target ROAS, Maximize Conversion Value, Maximize Conversions, and ECPC.

  4. Campaign type: Some smart bidding strategies are only available for certain campaign types. For example, Maximize Conversion Value is only available for Shopping and Smart campaigns.

  5. Budget: You need to have a budget for your ad campaign. Smart bidding requires a minimum daily budget of $1 per day.

  6. Ad spend: It’s recommended to have at least $50,000 in ad spend over 90 days to use smart bidding strategies to get better results.

  7. Goals: It’s important to have a clear understanding of your business goals and what you want to achieve with your smart bidding campaigns.

By meeting these requirements and having a clear understanding of your business goals, you can launch a campaign with smart bidding and start reaping the benefits of automation, improved performance, and better cost control.

In conclusion, Google Ads smart bidding strategies are an effective way to optimize your campaigns and reach your business goals. These automated techniques use machine learning to adjust bids in real-time based on the likelihood of a click leading to a conversion. There are several different types of smart bidding strategies available in Google Ads, including Target CPA, Target ROAS, Maximize Conversions, Maximize Conversion Value, Target Impression Share and ECPC. Each strategy has its own set of benefits and use cases.

To get the most out of your smart bidding campaigns, it is important to understand the different types of strategies available and when to use them. For example, Target CPA can help increase conversions while targeting a specific cost per action (CPA), Target ROAS can help increase conversion value while targeting a specific return on ad spend (ROAS), Maximize Conversions can help increase the number of conversions within your budget, Maximize Conversion Value can help increase the total value of conversions within your budget, Target Impression Share can help increase the reach of your ads, and ECPC can help to adjust your manual bids to try to maximize conversions when used with Manual CPC bidding.

Additionally, it is important to have proper tracking in place, such as conversion tracking and sufficient data for the system to learn from. Smart bidding also requires a budget and ad spend, with at least $50,000 in ad spend over 90 days recommended to get better results.

It’s also important to keep in mind that these automated bidding strategies should be constantly monitored and tweaked as needed to ensure they are working effectively. Although manual bidding can be useful in some scenarios, automated bidding strategies like smart bidding can be a more efficient and effective way to optimize your campaigns and reach your goals.

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by albert somlith
About author
Albert Somlith

Co-Founder of PPC Ad Editor. I am a leader in digital marketing, specializing in strategic planning, implementation, and optimization.