Google AdWords Bidding Strategies

PPC managers adjust keyword bids on a daily or weekly basis for hundreds of search terms to optimize performance. While this level of control is ideal for squeezing every last drop out of your paid search account, execution can be a problem when you have hundreds or thousands of keywords to optimize. When you reach the point where the time it takes to implement bid adjustments starts to take away from actual strategizing and managing the account, it’s time to consider flexible bid strategies.

What are flexible bid strategies?

  • Flexible bid strategies automatically set bids to optimize for your performance goals across specific campaigns, ad groups, and keywords.
Flexible bid strategies help automate PPC bid management to achieve your campaign goals. AdWords provides six strategies to help you achieve the goals:
  1. Maximize clicks
  2. Enhanced CPC (maximize conversions)
  3. Target Search Page Location (ad positioning)
  4. Target CPA
  5. Target ROAS
  6. Target outranking share
You can create your flexible bid strategy in the Shared Library in AdWords, which will make it available to apply on campaigns, ad groups, or keywords within your account.

Types of Flexible Bid Strategies

Maximize Clicks

Sets bids automatically to help you get the most clicks within your target spend
For campaigns that have limited conversion data and tracking website visits is the goal. Or, when Lost Impression Share due to Budget is a high percentage.
While AdWords will try to find the cheapest and highest-traffic keywords for your account, it does not discriminate by your keywords’ quality score. You may be driving clicks from lower quality keywords.

Target Search Page Location

Adjusts bids automatically to make your ad show either on the top of the search engine results page or on the first page of search results
When you have a new product, website section, or featured item and you want to drive exposure.
AdWords will use its recommended bid estimates to reach top of page/first page positioning, which can increase CPCs. Also, the results of the ad auction make this strategy less reliable than manual bidding – you may have to bid higher than the estimate to reach your desired position target.

Enhanced Cost-per-Click

Adjusts bids automatically up or down by up to 30% based on each click’s probability to result in a conversion
If you cannot optimize regularly, but want assistance to improve your conversions and you are comfortable with fluctuations
The 30% max bid adjustment will cause CPCs to rise. This strategy does not factor in your target CPA or ROAS. While you may drive more conversions, you may be paying more.

Target Cost-per-Acquisition

Sets bids automatically to maximize conversions while staying within your average cost-per-acquisition goal
If you are a B2B or lead gen is your goal. If you have steady conversion performance on the keywords you target. If you have hard cost-per-conversion goals
By setting a low goal CPA, you run the risk of decreasing overall conversion volume. You may experience an initial decrease in performance on launch while the strategy’s settings calibrate.

Target Return-on-Ad-Spend

Sets bids automatically to maximize conversion value (revenue) while staying within your average return on ad spend goal
If you track revenue from paid search or have varying values assigned to your conversions, and want to meet hard ROAS goals.
The target ROAS strategy runs the same risks as the target CPA strategy. Namely, a decrease in overall conversions if setting the ROAS too high, and an initial dip in performance on launch.

Target Outranking Share (New as of December 2014)

Sets bids automatically to help you outrank another competitor’s domain
If you identify a single competitor that you want to push out of the ad auction. If you want to increase visibility and exposure of your brand over a competitor.
Like the previous bid strategy, you run the risk of high CPCs due to the competitive nature of the ad auction. Be careful to set max bid limits so that you do not overspend for exposure.
With these flexible bid strategies, you will be able to mix and match depending on your marketing goals and apply account-wide, regardless of your account’s structure. That being said, it is ideal to keep keywords and ad groups tightly structured for better management. At the very least, liberal use of AdWords labels will help with organization and measurement.
Applying some of these flexible bid strategies will allow you to streamline day-to-day management and focus in on long-term strategy that takes your accounts to the next level. So, make sure to test out some of these bid strategies on your PPC account in 2015 and continue to crush performance!

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