This article will run on the objectives, functions, pros, and cons of these bidding strategies and how you can use them to optimize your PPC campaigns.
One of the biggest selections you’ll make building a PPC campaign will be the bid strategy. These strategies help Google determine when to display your ads and how you’ll rank at the time of auction. Google offers automated bid strategies depending on your campaign objective. You might want to control acquisition cost, maximize visibility, or maximize traffic.
Other bidding strategies include smart bidding, manual cost-per-click (CPC), target cost per acquisition (CPA), return on investment (ROI) based bidding and maximized conversions bidding.
This bidding strategy brings in conversions at the requested cost per acquisition (CPA). It doesn’t aim for volume or conversions of higher or lower value.
You can get conversions at either a higher or lower CPA which makes it ideal as a consistent bidding strategy for legacy campaigns, with all conversions being worth the same.
This also means that this bidding strategy can put you at risk of under-bidding or underspending unless you have a campaign that was already running for a while.
These campaigns need at least 15 to 60 days for accurate conversions to come in at the requested CPA.
Target Return on Ad Spend (ROAS)
This bidding strategy aims for the highest chance of converting for the highest value. This focuses on the conversion value instead of the volume.
Bidding on ROAS allows you to invest your budget in giving higher profits. It also balances out the volume and ROI.
However, if you don’t align your ROAS goal, budget, and keywords, you may end up either under spending or overspending with this bidding strategy. It requires knowledge of business operations and conversion values, making it challenging for new businesses.
This bidding strategy focuses on clicks or volume instead of conversions. This allows you to see how much your desired keywords cost while driving more traffic to your site.
This is a great way to ramp up your campaigns quickly and learn which keyword concepts fit better and at what cost. However, if you choose expensive keywords, you may still end up with no volume at all.
The traffic this drives to the site does not necessarily lead to sales either. This traffic is considered cheap volume, which may not contribute to profitability.
This bidding strategy aims for as many conversions as possible and would ignore the repeat rate. It’s ideal if you trust your conversions and have high-value conversions.
However, the budget spent on maximizing conversions does not consider the ROAS and will not work if you don’t set up any conversion actions. This may not be ideal if you have a complex consumer journey compared to typical eCommerce sites.
This strategy allows for total control over your bids. It prioritizes bid adjustments instead of accomplishing bidding goals which makes it ideal for taking complete control of your bidding strategy.
You get to set individual bids for each keyword, deciding whether you want to be conservative or aggressive on them. However, it may be easy to overbid if you make too many bid adjustments as they are cumulative. This is also time-consuming to monitor and update.
The ideal bidding strategy for your PPC campaigns will depend on your campaign goals and how much control you want to have on your campaign. Some of these bidding strategies may be more complex for beginners than others.
Are you looking for someone to help you with PPC advertising? That PPC Guy can help simplify these bidding strategies for you and optimize your PPC campaigns. Give us a call today to learn more!