Google Ads: Automated Bidding for Beginners

Both new and current users of Google Ads who actively run their advertisements can expect to receive calls from Google providing suggestions to enhance their account performance. Among the frequently offered recommendations, a prominent one is to configure their bidding settings to "Automated Bidding." 

While some users find this approach highly effective, others express dissatisfaction with the outcomes. This article aims to explain the distinctions between these perspectives and shed light on why automated bidding proves successful only under specific circumstances.

Types of Automated Bidding

Beginners have access to several automated bidding options, each designed to cater to different objectives and applications.

Target Impression Share

Target impression share ensures that your ads attain a designated impression share threshold within a specific location on the search results page, be it anywhere on the page, at the top of the page, or at the absolute top of the page. This strategy is specifically crafted to foster brand awareness.

Maximise Clicks

The "maximise clicks" strategy is formulated to generate the highest number of clicks feasible within your allocated Google Ads budget. Its purpose is to actively impact and enhance consideration.

Maximise Conversions

Opting for the maximise conversions bidding strategy facilitates the optimisation of your campaigns towards achieving more conversions. Within this strategy, you can choose to set a target CPA, directing smart bidding to strive for maximum conversions at the specific cost-per-action (CPA) you designate. If the target CPA isn't specified, maximise conversions will prioritise spending your budget to secure as many conversions as possible.

Maximise Conversion Value

The maximise conversion value strategy adjusts bids to optimise your campaign for the highest conversion value while adhering to your allocated budget. Emphasising the specific area you aim to maximise, this strategy ensures disciplined spending within your designated budget limits.

In instances where you employ maximise conversion value without setting a target ROAS, Google Ads will prioritise budget utilisation to maximise conversion value for your campaigns.

Conversely, when employing maximise conversion value with a set target ROAS, Google Ads will strive to achieve the maximum possible conversion value at the specified return on ad spend (ROAS).

Target CPA (Cost per Acquisition)

The target CPA strategy adjusts bids with the aim of securing the maximum number of conversions possible at the designated cost-per-action (CPA) you set. It's important to note that individual conversions may incur costs either above or below your specified target.

Target ROAS

The Target ROAS strategy adjusts bids to optimise for obtaining the highest possible conversion value at the specified return on ad spend (ROAS). It's worth noting that certain conversions may yield returns either higher or lower than your set target.

Enhanced Cost-Per-Click (eCPC)

This approach automatically modifies your manual bid, either increasing or decreasing it, contingent on the likelihood of each click leading to a conversion.

In the context of Search, eCPC is tailored for advertisers who prefer to manually set the core bid or utilise third-party bidding tools, incorporating an additional element of real-time optimisation.

What Bidding Strategy will Google Recommend?

Upon reviewing the configuration of your account, a Google sales representative will suggest either Maximise Clicks or Maximise Conversions based on their assessment.

Maximise clicks isn’t a good option

The Maximise Clicks option is presented by the representative when Conversions haven't been configured in your Google Ads account. However, it's crucial to note that opting for this doesn't guarantee the quality of the clicks you'll receive.

At ClickOn Marketing we have dealt with many representatives and Google account managers over the years. One of our account managers once gave us this advice: 

 "I strongly advise against utilising this strategy as it predominantly attracts irrelevant traffic to the website, leading to a budget being expended on low-quality clicks. In such instances, I recommend opting for Max Conversions."

We have also received numerous confirmations in the past in the form of clients transitioning their accounts to Maximise Clicks. This resulted in subpar leads and accelerated budget depletion.

Maximise Conversions

The recommendation for this option comes from Google's representative when Conversion Tracking has been configured on your account. While this can be beneficial, it does not assure a surge in leads. When opting for this alternative, two crucial factors need consideration to assess its effectiveness:

1. What do you count as a conversion?

Certain conversions, referring to valuable actions completed on your website post-ad click, possess varying degrees of value. For instance, a mere "Contact Us" page view holds lesser significance compared to a contact form submission. 

If you designate a "Contact Us" page view as a conversion, Google might perceive it as a commendable achievement, concentrating efforts on this seemingly easier conversion pursuit. However, this can lead to a decrease in actual leads being generated

2. What is the size of your industry?

The effectiveness of Google's smart bidding solutions relies on the available data's sample size. Industries exhibiting robust performance with automated bidding often possess ample data, enabling Google's AI to discern optimal bid adjustments for driving conversions. Examples of such thriving industries include:

• Automotive industry
• Insurance industry
• Plumbing and electrical services
• Some legal services (divorce, personal injury claims, RAF claims)

Conversely, industries with low search volumes encounter challenges in maximising the value of their ads budget through automated bidding. Examples of industries that may not fare well with automated bidding solutions include:

• Industrial markets
• Specialised medical services
• Some niche and specialised legal services
• Certain business-to-business services (such as software solutions and consulting services)

What Bidding Strategy You Should Use

If you are a beginner and have just started with Google ads, we recommend that you use one of the following bidding strategies:

Manual CPC

True to its name, in this approach, you manually determine bids for each keyword. Begin by establishing your bid at R15, and Google will promptly notify you if this amount seems insufficient for your industry.

Additionally, the system ensures that you outbid your closest competitor by just 1 cent, securing the top position and ensuring that you won't be charged the R15 if your competitor is only willing to pay R5 for a click.

The utilisation of Manual CPC is advised if you haven't configured conversions in your account, although this practice is not generally recommended. Google Ads specialists rely on Conversions as a key metric to gauge the effectiveness of their Google Ads campaigns.

eCPC (Enhance Cost-Per-Click)

eCPC stands out as our  preferred bidding strategy when initiating a new campaign. It proves to be a secure choice for channelling valuable traffic to the website and aids in determining a reasonable Cost Per Click (CPC). 

Additionally, it capitalises on Google's smart bidding capabilities, adjusting bids upward when there's a likelihood of user conversion.

This bidding alternative is exclusively accessible when Conversion actions have been configured. Similar to Maximise Conversions, it necessitates selecting the most valuable user actions, be it initiating a call from the ad or completing a form on the website. The efficacy of the setup directly correlates with the potential for generating more leads.

Feeling Lost in Your Google Ads Campaigns? 

In a climate where cost-cutting is a priority for many businesses and scepticism surrounds the reputation of Digital Marketing Agencies, it's natural for individuals to assume the responsibility of managing their own Google Ads. However, this doesn't negate the necessity for proper training.

Recognising this need, we've designed an immersive training experience tailored to demystify the intricacies of Google Ads. Our sessions not only delve into the fundamental principles but also provide practical insights on crafting effective campaigns for your specific business needs.

Our training equips you with the knowledge and skills essential for navigating the dynamic landscape of digital advertising, empowering you to optimise your campaigns with confidence and efficiency.

Find out more about our training here.