Google Ads: Automated Bidding for Beginners
New and existing Google Ads customers who run their ads have been getting calls from Google with recommendations on how to improve their account performance. One of the top recommendations being made is to set their bidding to “Automated Bidding”.
Some say it works a treat, others aren’t too happy with the results. In this article, we’ll explain why automated bidding only works in certain instances, and we’ll discuss the difference between Automated Bidding and our recommendations.
Types of automated bidding
There are 5 automated bidding options available, with various goals and applications in mind:
Target Impression Share
There are a limited number of impressions (ad spots) available on Google Ads on any given day, which is determined by the number of searches completed for your targeted keywords. ‘Target Impression Share’ ensures that your ads take up a percentage of the impression share for a specific location on the search results page; whether it’s close to the top of the first page, or at the absolute top of the page.
This is designed to generate brand awareness.
‘Maximize Clicks’ is designed to send as many visitors to your website as possible within the set Google Ads budget you have available. It is designed to introduce your products and services to potential customers, and helps your business become part of the options they consider when they are ready to buy.
Maximize conversions is set up to get as many website enquiries as possible within your budget. Because Google’s machine learning will determine your cost per click (CPC) for each search auction, you don't need to provide a specific CPC, cost per acquisition (CPA), or return on ad spend (ROAS) target.
Target CPA (Cost per Acquisition)
This strategy automatically sets bids to help you increase conversions, while reaching your average cost-per-acquisition goal (what you’re willing to pay per lead or online sale).
Enhanced Cost-Per-Click (eCPC)
This strategy automatically adjusts your manual bid up or down based on each click’s likelihood to result in a conversion.
For Search, eCPC is for advertisers who want to set the core bid manually or through third-party bidding tools, with an added layer of real-time optimisation.
What Bidding Strategy Will Google Recommend?
Google’s sales representative will look at the way your account is set up and recommend either ‘Maximize Clicks’ or ‘Maximize Conversions’.
Why Maximize Clicks Isn’t a Good Option
‘Maximize Clicks’ is the option that the Google representative will give if you haven’t set up Conversions on your Google Ads account. But this doesn’t mean that the clicks you’ll be getting will be relevant for your business.
As a Google Premier Partner, we have a dedicated Google Account Manager who provides us with suggestions on optimising account performance. This is what he had to say:
“I really recommend not using this strategy, since it only focuses on bringing the irrelevant traffic to the website, which will result in spending budget on bad quality clicks. I recommend using Max Conversions in that instance”
Many of the trainees who attend our Google Ads course confirmed that once they switched their accounts to Maximize Clicks, they received poor-quality leads and their budget was spent much faster.
Google’s representative will recommend this option if you’ve set up Conversion Tracking on your account. As great as this can be, it won’t guarantee an increase in leads. When selecting this option, there are two factors that must be taken into consideration to determine success:
1. What Do You Count as a Conversion?
There are some conversions (valuable actions a person completes on your website after clicking on your ad) more valuable than others. For example: A “Contact Us” page view is worth less than a contact form submission.
If you’ve included a “Contact Us” page view as a conversion, Google will think it’s doing a great job by focussing on this conversion (because it is the easiest conversion to chase). This will result in fewer actual leads coming through.
2. What is the Size of Your Industry?
Google’s smart bidding solutions depend on the sample size of the data available to them. There are some industries that do extremely well using automated bidding because there is enough data for Google’s AI to learn when to increase the bid to drive the conversion.
Examples of industries that do well with automated bidding solutions are:
- Automotive industry,
- Insurance industry,
- Plumbing and electrical services,
- Some legal services (divorce, personal injury claims, RAF claims).
In cases where the search volume is low (the number of times something is searched), Google has a hard time driving the most value for your ads budget.
Examples of industries that don’t do well with automated bidding solutions are:
- Industrial markets
- Certain business to business services (like software solutions and consulting services)
- Specialised medical services
- Some legal service (niche and specialised legal services)
What bidding strategy you should use
We recommend using one of the following bidding strategies if you’re a Google Ads beginner:
As the name suggests, you’ll be setting your bids manually per keyword. To start off, set your bid to R15 per click. Google will let you know if this is too low for your industry.
You can also rest assured that you’ll only need 1 cent more than your closest competitor to outbid them, so you won’t be charged R15 if your competitor is only willing to pay R5 for a click.
You’ll use Manual CPC if you haven’t set up conversions in your account, though this isn’t recommended. Google Ads specialists use Conversion to measure the success of their Google Ads campaign.
eCPC (Enhance Cost-Per-Click)
eCPC is our favourite bidding strategy when we onboard a new campaign. It’s the safest bet in terms of driving valuable traffic to the site, and it helps establish what a reasonable CPC is. It also leverages some of Google’s smart bidding capabilities, that will increase the bid if the user is likely to convert.
This bidding option is only available if you’ve set up Conversion actions. As is the case with Maximize Conversions; you need to choose the most valuable actions you want your user to take - whether it’s placing a call from your ad, or completing a form on your website. The better the setup, the more leads you’ll get.
Feeling Lost in Your Google Ads Campaigns?
With companies cutting costs it’s understandable that many people take on their own Google Ads management.
But that doesn’t mean you don’t need training. Fortunately, we’ve created an intimate classroom training experience that runs through the principles behind Google Ads and gives practical advice on setting up campaigns for your business.
View our upcoming course dates, and make a booking to see how businesses have grown using Google Ads.