How to use automated bidding strategies

Automated bidding strategies are a powerful tool for Google Ads (formerly Google AdWords) and Microsoft Advertising (formerly Bing Ads) advertisers, allowing them to optimize their bids in real-time to achieve their desired goals. By leveraging machine learning algorithms and auction dynamics, automated bidding strategies can help advertisers maximize their return on ad spend (ROAS), conversions, and revenue.

Table of Contents

Understanding Automated Bidding Strategies:

Automated bidding strategies use machine learning algorithms to analyze your ad campaigns, auction dynamics, and target audience to determine the optimal bids for your ads. There are several types of automated bidding strategies, including:

Target Cost Per Acquisition (CPA): Bids are adjusted to achieve a target CPA. This strategy is ideal for advertisers who want to pay a specific amount for each conversion.
Target Return on Ad Spend (ROAS): Bids are adjusted to achieve a target ROAS. This strategy is ideal for advertisers who want to maximize their revenue.
Target Conversions: Bids are adjusted to achieve a target number of conversions. This strategy is ideal for advertisers who want to maximize their conversions.
Enhanced Cost Per Click (ECPC): Bids are adjusted to achieve a target CPC while maximizing conversions. This strategy is ideal for advertisers who want to balance their CPC with their conversion goals.

Setting Up Automated Bidding Strategies:

Setting up automated bidding strategies is a straightforward process. Here’s a step-by-step guide:

Log in to your Google Ads or Microsoft Advertising account.
Go to the “Campaigns” tab and select the campaign you want to set up automated bidding for.
Click on the “Bidding” tab and select “Automated bidding” from the dropdown menu.
Choose the automated bidding strategy you want to use (e.g., Target CPA, Target ROAS, etc.).
Set your target CPA, ROAS, or conversion goal. For example, if you’re using Target CPA, you’ll set a target CPA of $50.
Choose the bidding algorithm (e.g., “Maximize conversions” or “Maximize conversions with target CPA”). The algorithm will adjust your bids to achieve your target CPA or ROAS.
Set your bid adjustment percentage (optional). This allows you to adjust your bids by a specific percentage.
Review and confirm your settings.

Monitoring and Adjusting Automated Bidding Strategies:

Monitoring and adjusting automated bidding strategies is crucial to achieving your desired goals. Here are some best practices:

Regularly monitor your campaign performance using Google Ads or Microsoft Advertising reports. This will help you identify any issues or inconsistencies.
Adjust your target CPA, ROAS, or conversion goal as needed. For example, if your target CPA is too high, you may need to adjust it downward.
Review your bid adjustment percentage and adjust it if necessary. This will help you fine-tune your bidding strategy.
Monitor your campaign’s automated bidding strategy performance using the “Automated bidding” report. This report will provide insights into your bidding strategy’s performance, including your target CPA, ROAS, and conversion rate.
Adjust your bidding strategy if you notice any issues or inconsistencies. For example, if your automated bidding strategy is consistently underperforming, you may need to adjust your target CPA or ROAS.

Best Practices for Automated Bidding Strategies:

Here are some best practices to keep in mind when using automated bidding strategies:

Start with a small test campaign: Before implementing automated bidding strategies across all your campaigns, start with a small test campaign to validate the strategy.
Monitor your campaign performance closely: Regularly monitor your campaign performance to identify any issues or inconsistencies.
Use automated bidding strategies for campaigns with a high volume of conversions: Automated bidding strategies are most effective for campaigns with a high volume of conversions.
Use ECPC for campaigns with a high CPC and low conversion volume: ECPC is ideal for campaigns with a high CPC and low conversion volume, as it helps to balance your CPC with your conversion goals.
Use Target CPA for campaigns with a high CPA and low conversion volume: Target CPA is ideal for campaigns with a high CPA and low conversion volume, as it helps to achieve a specific CPA.
Use Target ROAS for campaigns with a high ROAS and low conversion volume: Target ROAS is ideal for campaigns with a high ROAS and low conversion volume, as it helps to maximize revenue.
Consider using multiple automated bidding strategies for different ad groups or campaigns: Using multiple automated bidding strategies can help you achieve different goals for different ad groups or campaigns.
Regularly review and adjust your automated bidding strategies: Regularly review and adjust your automated bidding strategies to ensure they’re achieving your desired goals.

Common Challenges and Solutions:

Here are some common challenges and solutions to keep in mind when using automated bidding strategies:

Challenge: Automated bidding strategies may not perform as well as manual bidding strategies.
Solution: Regularly monitor your campaign performance and adjust your automated bidding strategy as needed.
Challenge: Automated bidding strategies may not be suitable for all campaigns.
Solution: Start with a small test campaign to validate the strategy and adjust your target CPA, ROAS, or conversion goal as needed.
Challenge: Automated bidding strategies may not account for seasonal fluctuations or changes in auction dynamics.
Solution: Regularly review and adjust your automated bidding strategy to account for seasonal fluctuations or changes in auction dynamics.

Conclusion:

Automated bidding strategies are a powerful tool for Google Ads and Microsoft Advertising advertisers, allowing them to optimize their bids in real-time to achieve their desired goals. By following the best practices outlined in this guide, you can effectively use automated bidding strategies to maximize your return on ad spend, conversions, and revenue. Remember to regularly monitor your campaign performance and adjust your automated bidding strategy as needed to ensure you’re achieving your desired goals.