Choosing the right Smart Bidding strategy in Google Ads is crucial for achieving campaign goals. Whether the focus is on controlling costs, maximising revenue, or driving traffic, Google Ads’ Smart Bidding options provide a range of automated solutions to reach those objectives.
In this article take a look at 5 current top strategies for Google Ads Smart Bidding, in a follow up to our previous blogs on smart bidding strategies:
- Google Ads Reorganises its Smart Bidding Strategies (May 14, 2021)
- Bid Adjustments vs. Auto Bidding in Google Ads (January 7, 2020)
These are the five strategies and when to use and not use them:
Target return on ad spend (ROAS)
tROAS aims to generate the highest possible return on ad spend by automatically adjusting bids based on the predicted value of each conversion, although you can’t simply set a high ROAS target and expect to hit it if you haven’t achieved similar performance in the past.
When to use it:
Ecommerce Sales: If your goal is to maximize sales value while maintaining a profitable return on investment. Target ROAS helps you focus on the conversions that generate the most value.
Profit-driven campaigns: When your primary goal is revenue generation and you can attribute a value to each conversion.
When to avoid it:
If you’re unsure about the value of each conversion or have a low volume of conversions, it may not perform as expected.
Target CPA (Cost per acquisition)
tCPA sets bids to help get as many conversions as possible at or below a specified target cost per acquisition / conversion. It’s designed to control how much you pay per conversion while maximising the number of conversions.
When to use it:
Lead generation: If your goal is to acquire new leads at a specific cost (e.g., filling out a contact form or signing up for a newsletter). Target CPA helps control costs while driving conversions.
Tight budget control: When you have a clear understanding of how much a lead is worth to your business and need consistent costs for each conversion.
When to avoid it:
If your conversion volume is too low, target CPA might struggle to find enough data to optimize bids effectively.
Maximise Conversions
Max, Conversions is an automated strategy that sets bids to get the most conversions possible within the daily budget. Instead of focusing on controlling the cost per conversion, this strategy prioritises generating the highest number of conversions, even if it means varying costs for each conversion.
When to use it:
Limited budget: When you want to spend your entire budget to get as many conversions as possible, Maximize conversions works well.
High-volume goals: When the goal is to increase the volume of leads, sales, or sign-ups without focusing on cost per acquisition.
When to avoid it:
If your goal is profitability or you have strict CPA or ROAS targets, Maximise Conversions might not give you the control you need over costs.
Maximise Conversion Value
Max, Conversion Value sets bids to maximise the total value of conversions (e.g. sales revenue) rather than focusing on the number of conversions. Essentially, it adjusts bids based on the potential revenue each conversion can bring, rather than aiming to simply increase conversion volume.
When to use it:
Sales value focused: If you’re running ecommerce campaigns and want to prioritise high-value conversions, this strategy helps drive more revenue.
Promoting dynamic products or services: When conversion values vary significantly between products or services, this strategy will help you optimise based on the value.
When to avoid it:
If you do not track or assign values to your conversions, this strategy won’t work for you.
Maximise Clicks
Max. Clicks is an automated bid strategy designed to drive as much traffic as possible to your website within a specified daily budget. Essentially, it sets your bids to the highest possible max CPC (Cost Per Click) within that budget, aiming to get the most clicks.
When to use it:
Brand awareness: If your goal is to drive traffic and increase brand visibility rather than focusing on conversions, Maximize Clicks is ideal.
Low-cost traffic: When your primary goal is to generate as much traffic as possible, especially in the awareness phase of your marketing funnel.
New campaigns: When there is no historic data for Google to use with a Smart Bidding strategy, it can be good to use Max Clicks to drive traffic and build up conversion data before switching to another strategy.
When to avoid it:
If conversions, sales, or lead generation are your primary goals, other strategies like target CPA or Maximize Conversions would be more suitable.
Summary
- Use Target CPA when you want to control your cost per acquisition.
- Choose Target ROAS to focus on maximizing the value of each conversion.
- Implement Maximise Conversions if volume is your top priority, without strict cost control.
- Opt for Maximise Conversion Value if revenue is more important than the number of conversions.
- Go with Maximise Clicks for brand awareness and driving traffic to your website.
By understanding these strategies and when to apply them, it’s possible to leverage Google’s automation to improve campaign performance and achieve the desired goals. Marketers should always be flexible and switch between strategies if one doesn’t appear to be working well, although Google does also suggest at least a 14-day learning period for a new strategy to take full effect.
If you want to know more about how the correct use of these strategies could help your business, please get in touch.