What is the best bid strategy

Adwords bid strategies - which one fits my goal?

Every advertiser who has already run a Google Adwords campaign knows the principle: For one or more business-relevant keywords, text or display ads are shown in the search results of Google. Clicking on the ad incurs costs. The price per click is determined by Google according to the action house principle. The higher the market bid, the higher the click price.

Now every advertiser pursues different advertising goals with the ad placement on Google Adwords. The budgets vary depending on the business model and objectives. In order to support marketers in achieving their goals within the budget set, Google provides different bid strategies. The bid strategy specifies how the given daily budget should be used and which goals should be aimed for.

Manual bid strategies

1. Manual CPC:

This is the maximum amount you are willing to pay for a click on your ad. It is set manually by you and there is no optimization by Google. The question when determining the CPC must be: How much can the average click cost at most so that I stay in the profit zone with my advertising? How much can the turnover generated by visiting the site cost me? You can assign different bids for different keywords within a campaign and thus set priorities and distribute your budget efficiently. This strategy is ideal for Adwords beginners who want to manage their budget manually and who want to keep control of the performance through independent optimizations.

The automated bid strategies

2. Auto-optimized CPC:

With this automated bid strategy, Google automatically adjusts the bids in order to achieve the maximum number of conversions with the given daily budget and the maximum click bid. Google always lowers the manual CPC bid when a conversion is unlikely. If a high probability of conversions is suspected, Google will automatically raise the bid. On average, the requirements set by the user are not exceeded. To assess the likelihood, Google takes into account the advertiser's business in conjunction with factors such as the time of day, device type, browser or location. In order to activate the auto-optimized CPC, conversion tracking should be active. Here you can read how to set up conversion tracking. A conversion is the conversion of a page visitor into a user who takes a desired action on your page. This can be, for example, registering for a webinar or an online shop sale. The auto-optimized CPC and the three following strategies are part of Google's smart bidding strategies and are particularly well suited for sales-oriented and lead-oriented business models.

3. Maximize conversions:

Google optimizes the budget for a maximum number of conversions. The optimal CPC bid is based on the actually measured data from the conversion recording. The prerequisite is that the user has installed conversion tracking in Google Analytics and it is linked to the Adwords account. This strategy is all about the number of conversions. The counter value is the action carried out (newsletter registration, order, etc.).

4. Target CTA (cost per acquisition):

In contrast to the “maximize conversions” bid strategy, this strategy is not about the number of conversions generated, but about the given value that you are willing to pay per conversion. Google tries to generate as many conversions as possible for the given price. The price can fluctuate, but on average the specified value is aimed for. Another requirement is that conversion tracking is installed and that a sufficient amount of data is already available. If the value is chosen too low or the data basis is too small, it can happen that the traffic is slowed down and the desired effect is not achieved.

5. Goal ROAS (Return on Advertising Spend)

The target ROAS is also one of the conversion-oriented bid strategies. Here you determine how much revenue should be generated per click. The bid strategy is based on the achievement of a sales target and the advertising costs that are necessary to achieve the desired sales. X € advertising costs should generate a turnover of X €. A prerequisite is a sufficient data basis through conversion tracking. As with the target CTA, at least 50 conversions should have been recorded via the tracking in the last 30 days. With this strategy, the specified advertising expense ratio will not be exceeded. For example, if you determine that every dollar invested in advertising should generate ten times the revenue, your goal would be ROAS 1000%.

6. Maximize clicks

With this automatic bid strategy from Google, your daily budget is exhausted in such a way that maximum clicks are generated. This bid strategy is particularly suitable if you want to bring as many visitors as possible to the page, learn from the movements on the page and want to optimize yourself afterwards. The disadvantage of this method is that the conversion is neglected and that the daily budget can quickly be exhausted if there is insufficient manual control.

7. Competitive auction position

This bid strategy is aimed at branding and the expansion of the market position vis-à-vis the competition, because the bid is optimized in such a way that the ad is always above a domain you have selected. However, this strategy is no guarantee that you will always be played out in the top positions. The strategy only provides a head start over a specific domain. In the battle for first place, the other competitors as well as their bids and quality factor continue to play a role.

8. Alignment to search page position

This strategy optimizes your budget so that your ad appears either at the top of the first page or somewhere on the first page. The bids will be adjusted as part of your daily budget so that these positions are targeted. This bid strategy is also suitable for increasing visibility and reach. However, it is advisable to set a maximum CPC bid in order to avoid unexpectedly high costs.

The bid strategies can be used at the campaign level, at the ad level or at the keyword level and thus allow a meaningful mix within the advertising budget. Priorities can be set and the budget can be distributed depending on the objective. Example: For a general keyword such as "Online Marketing Agency Hamburg", a competitive action position is set in order to stand out from a competitor. Using the keyword “more followers on Twitter”, a conversion-oriented strategy is chosen to sell an e-book via the target page. In general, it is advisable to optimize each keyword individually and not give Google complete control of your advertising.


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