When setting up a campaign on Google Ads, you must choose a bidding strategy for your campaign. The bid strategy that you choose will determine how Google Ads will spend your budget and how you want to bid on the keywords for your campaign.
Bidding strategy is not limited to Search campaigns only, as you will have need to have a bid strategy for display and video campaigns as well.
Google gives you a number of options on what bid strategy you want to choose. Some of them are manual which allows you to have control over your bid, and some of them are automated which puts Google in control of how you want to reach your goal.
Choosing the right bid strategy is a crucial part of your campaign. By selecting the bid strategy, you can reach your goal at a lower cost, and choosing the wrong bid strategy will drain your budget without actually reaching your goal.
In this post, I will explain all Google Ads bidding strategies in detail and when you should use each one.
There are 12 bid strategies on Google Ads that you can choose.
Bid strategies with a focus on getting conversions:
• Target cost per action (CPA)
• Target return on ad spend (ROAS)
• Maximize Conversions
• Maximize Conversion Value
• Enhanced cost per click (ECPC)
Bid strategies with a focus on getting traffic (clicks):
• Maximize Clicks
• Manual CPC bidding
Bid strategies with a focus on visibility:
• Target Impression Share
• CPM (Cost per thousand impression)
• tCPM (Target cost per thousand impression)
• vCPM (Cost Per Viewable Thousand Impressions)
Bid strategy with a focus on views (specific to video ads only)
• CPV (Cost Per View)
Manual CPC (Cost per click)
With manual CPC bidding, you will have control over how much you want to bid for each keyword. When you set a manual cost per click for your keywords, you will specify how much maximum you are willing to pay for a keyword.
When you set an amount as maximum CPC for your keyword, it means that Google will spend up to that amount (or lower) for a targeted keyword but will never go above the maximum bid that you defined.
You can set your CPC at keyword level for all keywords, or at ad group level for all keywords in that ad group, or a default CPC at campaign level for all the keywords of your campaign. If you set different CPCs at ad group and keyword levels, the keyword level bids override ad group level bids.
Using max CPC strategy generally requires more maintenance and time, as you should adjust your bids continuously for best results.
In manual CPC bidding, you don’t have to set up a conversion tracking.
Enhanced cost per click (ECPC)
The difference between Enhanced CPC and manual CPC is that in ECPC, you will leverage some automation as Google’s machine learning algorithms will increase your bids when there is a chance of getting more conversions at a higher bid.
Unlike manual CPC in which Google never exceeds your max CPC bid, in Enhanced CPC you give freedom to Google to increase (or decrease) your bids.
In Enhanced CPC, you must set up a conversion tracking, as Google algorithm will decide whether to increase or decrease your bid based on the likelihood of you getting conversion from a user.
Maximize Clicks
Maximum clicks bid strategy is pretty self-explanatory. As the name implies, you will receive the most possible clicks within your budgets. Most clicks here will probably mean many low-quality clicks. This bid strategy is helpful when your goal is to increase your website traffic.
You still have the option to set a maximum cost per click bid limit if you don’t want to pay too much for a click, but doing so might limit Google in spending your daily budget to the full.
Maximize Conversions
Maximum conversions is very similar to maximum clicks bidding strategy, but this time instead of clicks, Google will try to get you the most conversions within your budget.
Maximize conversions is useful if your goal is to increase sales or leads, but sometimes your cost per clicks might go through the roof! You don’t have the option to set a maximum cost per click bid limit here.
You need to have conversion tracking set up for this bid strategy to be available.
Target CPA
When using Maximize conversions as bidding strategy, you can set an average cost you’d like to pay for each conversion. CPA stands for cost per action (or cost per acquisition) which gives you more control over how much you would be willing to spend for each conversion.
Target return on ad spend (ROAS)
Target ROAS is a useful strategy for eCommerce website, in which you will target a certain revenue you would like to get for each dollar you spend on ads. For example, a target ROAS of 6 means you will get $6 in return for every one dollar that you spend on clicks.
Target ROAS bidding strategy will ensure you hit profitability margins for your products.
It’s important to set a reasonable target ROAS, as Google will struggle to spend your budget if you set it too high.
To see your ROAS data in Google Ads, you should look for “Conv. Value / cost” column in the reporting section.
Maximize Conversion Value
With this bidding strategy, Google will optimize your bids trying to get you the most conversion value within your daily budget.
When setting your conversion tracking, you define a value for your conversions that you want to maximize.
Target Impression Share
Target Impression Share bidding strategy will help to increase your brand awareness by showing your ads on top pf the page (or anywhere on the search results page).
Target Impressions Share is especially very useful for branded campaigns if the impressions hare for your campaigns is not already high. Google might increase your bids significantly to always show your ads on search results, so you should keep track of the cost your campaign when using this bidding strategy.
CPM (Cost-per-thousand impression), vCPM, and tCPM
CPM bidding strategy is specific to Display and YouTube campaigns in Google Ads, in which you pay per 1,000 thousand impressions.
CPM bidding strategy is generally used for brand awareness campaigns.
vCPM (Viewable CPM) meansyou only pay when your ads are seen. In Google Ads, ‘viewable’ is defined as your ads showing on screen for minimum 1 second (Display ads) or 2 seconds (video ads)
tCPM (Target CPM) bidding strategy allows you to set an average amount for how much you are willing to pay for every 1,000 impressions.
CPV (Cost Per View)
CPV bidding strategy is specific to video ads on YouTube in which you pay for video views or engagements (clicks). A view is counted when a user watches at least 30 seconds of your video.
When setting up a campaign in Google Ads, you have many options to choose your bidding strategy. You should select the right bidding strategy based on your goal. You can always change your bidding strategy if you decide the current one is not helping you enough.
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