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Breaking Down 7 Bidding Strategies For Google Ads

Published
October 1, 2019
10 Min Read

Nowadays, for brands, paid campaigns can lead to more conversions if the strategy is focused, and this is why Google Ads is becoming so popular among all industries. Google Ads is an online advertising platform where brands pay for having advertisements shown on Google ad networks. 

According to Google, advertisers make $8 for every $1 they spend on Google Ads. As thousands of companies are using Google Ads to promote their businesses, if a brand is only aiming to improve the organic search result, the brand’s website would still be pushed down on the search engine page as the competitors are paying to rank higher. 

In this guide, you will discover what you need to know so that your bidding strategy suits your needs and helps you achieve the best result on your marketing spend. 

After setting up your campaign name, network, location, audience, and budget, it’s time to enter your bidding strategy. The following is the list for all these strategies. 


Automated bidding strategies:

  1. Target Search Page Location
  2. Target ROAS
  3. Target CPA
  4. Target Outranking Share
  5. Maximize Clicks


Semi-Autonomous Bidding Strategies:

  1. Manual CPC with enhanced CPC enabled


Manual bidding Strategies:

  1. Manual CPC


Let's now look at them one by one:

  1. Target Search Page Location:

Objective: Having your ads shown higher on the search engine result page

How it works: Based on your budget, Google will try to help you win as many first page bids or top of page bids as possible. 

Example: As a new e-commerce brand, to increase brand awareness, you decide to adopt this strategy.


  1. Target ROAS (Return On Advertisement Spending):

Objective: 

ROAS = Total Conversion Value / Cost

This strategy will aim to bid based on how much return you make on your advertising spend. 

How it works: Google will predict which clicks are likely to convert and how much money those conversions would make for you. Two things to bear in mind when adopting this strategy: 1. You have to let Google know your conversion value (How much revenue do you need) 2. You have to have at least 15 conversions in the past 30 days so that there is enough data for Google

Example: For your next Google Ads campaign, you want to generate £12 for every £4 spent. You follow the formula provided below:


Sales/ ad spend x 100% = Target ROAS


You put in your numbers and get the following result:


£12 in sales from campaign / £4 ad spend (clicks) x 100% = 300%


After getting the number ‘300’, you put this down on Google, and it will try to help you win the bid.


  1. Target CPA (Cost per Acquisition)

Objective: To get as many conversions as possible for your target cost per acquisition

How it works: Your cost per acquisition is the amount of money you can afford to spend on acquiring a customer. Google will predict which clicks are likely to convert and how much it will cost for that click to convert. 

Example: You calculate your breakeven price and decided on a price as your maximum number for your cost per acquisition. You enter the amount on Google ads, and Google will try to help you win the bids. 


  1. Target Outranking Share

Objective: To outrank your competitors

How it works: Outranking means that your ads appear higher than others. You set up a maximum cost per click bid limit and tell Google which website you want to outrank.

Example: You notice a new competitor in your industry. To still have the majority market share, you decide to adopt this strategy. 


  1. Maximize clicks 

Objective: To have more traffic to your website

How it works: You have to set a maximum cost-per-click limit first. Google will try to get you as many clicks as possible. 

Example: As a newly established brand, you want to gather more data on how customers interact with your website. You decide to adopt this strategy. 


  1. Enhanced CPC (Cost Per Click)

Objective: To maintain control of your keywords while relying on Google to optimize cost per clicks for more conversions. 

How it works: First, you set up your maximum cost per clicks bids. Later on, Google will automatically raise your bids or decrease your bids based on how likely it thinks the click is to have a conversion. 

Example: You want to have control over how much you pay for your keywords, but you also feel that your bids could be more optimized than they currently are. 


  1. Manual CPC 

Objective: To maintain full control over your bids in every auction. 

How it works: You set up your maximum cost per click bid price, and Google won’t bid more than your max in any circumstances. You can add Enhanced CPC at any time. 


Given Google Ads’ reach and authority, brands should start thinking about how to incorporate Google ads with paid marketing strategy. The above information could help you navigate through the complexity of Google Ads, providing you with a better chance to succeed in launching Google Ads campaigns.


If you'd like a digital marketing specialist to help run, execute and plan for your Google Ads strategy, Traktion.ai is here to help with our exclusive network of pre-vetted digital marketing experts. Find your marketer here.

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