google bidding strategy

A Complete Guide on Google Ads Bidding Strategies


Google Ads is one of the most widely used platform to run paid campaign and having lot more option to customize your ads based on your targeting, customer, products and more. We have published articles on creating profitable Google Ads campaign, Google Ads extension, types of Google Ads campaign, and more. In this article, I am going to explain in detail all about the Google Ads bidding and strategies.


What is Google Ads Bidding?

Google Ads bidding option let you decide how much you are willing pay to achieve your goal. You can select bid on click, impression, positioning, and conversion.


How many types of bidding and what they are?

Google Ads bidding is classified in two broad categories – Automatic and Manual.

Automatic Bidding –Automatic bidding let you decide the bidding on the certain goal, i.e. click, impression, conversion, and positioning.

Following are the types of automatic bidding strategies that you can choose based on your goal –

  1. Target CPA
  2. Target ROAS
  3. Maximize clicks
  4. Maximize conversions
  5. Target search page location
  6. Target outranking share
  7. Enhanced CPC


The above-mentioned strategies helps you to choose the best that perfectly match your business goal.

Manual Bidding – Manual bidding let you manage you biding based on your budget. On a daily basis you can set it and manage. These types of bidding is most commonly used in a situation where you want more control over amount of money spent.


Types of automatic bidding strategies

Under automatic there are seven different types of bidding strategies. The most commonly used are Maximize conversion and Maximize click. Each types of automatic bidding are developed to meet specific requirement of advertiser.

Here, are the list of strategies with complete explanation –

  1. Target CPA (Target cost per acquisition)

    Google Ads target CPA bidding strategies helps you to achieve an average CPA equals to your target across all the campaign. Some conversion may cost more than your target CPA and some may cost less. Keep your cost per acquisition equals to the target CPA.

    Example – Suppose I manufacture an electronic product which cost $100 and after removing all the cost and profit margin – manufacturing, advertising, print-media, and miscellaneous expense, I am comfortable to bid $20. So, in this case, I can go for Target CPA = $20 and Google ads helps me to get the maximum conversion at the target CPA I set.

    How Google target CPA works?
    • The bidding works as per your campaign historical information.
    • Evaluate contextual information presented at the time of auction.
    Important points to remember for Target CPA
    • This work perfect for both search and display network.
    • To implement it successfully must implement conversion tracking.
  2. Target ROAS (Target return on ads spend)

    Target returns on ads spend helps you to get more conversion value/revenue at the target return on ads spend you set. Google ads automatically optimized your ad at the auction time and manage you bid perfectly to get maximum revenue.

    Example –For every single dollar I spent, I want to earn $5. This means that I want to earn 5 times of the amount I spent. In this case, my profit margin is equals to 500% of every single dollar.

    Whatever the target ROAS you set, Google Ads will automatically set your bid to maximize your target ROAS.

    How Google Target ROAS works?
    • The bidding works as per your campaign historical information and manage your bidding at auction time.
  3. Target search page location

    This is one of the type of automatic bidding strategies that works with search network campaign. This bidding strategy automatically increases/decreases the bid to show your ads on the first page or first position of Google SERP.

    Example – I have a business, and I want to show my ad on the first page/first position, I will go for this type of bidding.

    How target search page location bidding works?
    • Once you apply this strategy, it may takes few minutes to update the ad positioning over Google SERP. Under this strategies, Google update the bidding several time a day to show your ads on the target position (first page/first position).
    • There is no guarantee that every time your ad hits the target positioning.
  4. Target outranking share bidding

    Target outrank share bidding is one of the best type of bidding that works perfect to beat your competitor. This strategy also works only with search network only and helps you to out rank your competitor.

    Example – Suppose I do advertising for Amazon and Flipkart is my competitor. In such case, target outranking share bidding works perfect. This bidding strategy automatically increases/decreases the bid to outrank my competitor – Flipkart and show my bid above to my competitor.

    How target outranking share bidding works?
    • When you go for outranking bidding strategy, it helps you to improve your ad position in comparison to your competitor (specified in the out rank bidding). But, this strategy does not have any impact on the ad rank.
    • With this strategy, you can only specify one competitor.



  5. Enhanced cost per click

    Enhanced CPC bidding works based on your account historical data and increases the bid if there is a chance of conversion is high and decrease the bid if there is chance of conversion is low.

    Example – Suppose I sell electronic product on my e-commerce store @$2 and have turned on “Enhanced CPC bidding”, Google ads increase the CPC bid if an auction likely to convert into lead. So, the bid can increase to $2.50, $3 or more.

    If the ECPC sees an auction unlikely to lead to a sale/conversion, it might lower the bid to $1.5, $1.7 and so on.

  6. Maximize click

    Maximize click bidding strategy works perfect to increase clicks for your campaign. You can specify the amount you are willing to spend on daily basis and by choosing maximize click strategy, Google ads automatically maximize the no. of click within the budget you set.

    Example- Suppose I have a business requirement, to get maximum click on my product. So, I will choose Maximize click bidding strategy.

  7. Maximize conversion

    Maximize conversion bidding strategy works perfect to increase number of conversion for your campaign. You can specify the amount you are willing to spend on daily basis and by choosing maximize conversion strategy, Google ads automatically maximize the no. of conversion within the budget you set.



Conclusion

To get more clarification on Google Ads bidding strategies, you can put your questions in comment section. It would be my please to answer them.


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