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Google Ads: Automated Bidding and what you need to know 

Google Ads: Automated Bidding and what you need to know 

The number of bidding options available for your Google Ads has increased over the last few years. Manual bidding, automated bidding and smart bidding are all options you can use, but do you know what they all mean and how you should be using them for your campaigns? Find out more in this blog.

The Google Ads platform is constantly evolving and the number of bidding options available has increased over the last few years. You might have heard of manual bidding, automated bidding and smart bidding but, do you know what they all mean and how you should use them for your campaigns? 

To be successful with Google Ads, it’s important to stay up-to-date with changes and better ways of working so that your campaigns deliver the best results. Each type of bidding strategy will have an impact on the results you drive through paid search so in this guide, we’ll unpick each strategy, how you can use it and when you should use it. 

Some bidding strategies will work better for your campaigns than others so knowing how each works will help you to work out what’s going to deliver ROI for your business. 

Without further ado, let’s take a deeper look into Google’s automated bidding strategies. 

If you’d like more information on Google Ads Automation, why not take a look at our blog? Google Ads Automation: What is it, and why does it matter

What do we mean by bidding strategies? 

Before we look into the bidding strategies available to you, let’s explain what we mean by that. 

Your bids are at the heart of your campaigns and will help you to get the most from your budget. Small mistakes with bidding can cost a lot of money and leave you lacking the results you wanted. 

Every time someone conducts a search on Google, it runs an auction involving all advertisers to determine which ads will show and where they will show. Your bidding strategy will determine if and when your ads will be shown when an ad auction is triggered.

Each strategy will signal to Google how much you want to pay for clicks, conversions, impressions and views. 

Remember that your bid strategy and maximum bid amount are only part of the reason why your ad will appear in certain positions. Other factors taken into account include: 

  • Your ad’s quality score 
  • Your ad extensions 
  • The content of the search including location, device and the time of the search 
  • Competitiveness of the keywords you’re bidding on 

Now, onto the bidding strategies you can use…

Manual Bidding 

Manual Bidding is just like the name suggests; you’ll adjust your bids manually at campaign, keyword or ad group level. You need to tell Google how much you’re willing to pay in the auction for the keywords you’re using.

To do this, you will need to analyse past performance data to understand what’s delivering the desired results for your business and adjust spend accordingly. 

Manual Bidding puts you in complete control of your campaigns. You can decide how aggressive you want to be or how much you want to pull back to appear for particular search terms. Once you notice a decline in performance, you can go in and make adjustments straight away. 

Google is encouraging advertisers to move away from manual bidding. Automated strategies use machine learning and Google’s algorithms to understand your campaign’s performance and make improvements. 

When should you use Manual Bidding? 

There are a number of different reasons why Manual Bidding might be the best option for your paid search campaigns. These include:

  • You have a small budget - Manual Bidding provides you with greater control over your budget and makes sure you put the most into the keywords and ads that will drive results.
  • You have a small amount of data (less than 30 days) - if you’re new to Google Ads, you might want to run campaigns with manual bidding to start with. This gives you and Google time to collect data so you can see what’s going to be most effective. 
  • You want to maintain control - if you want to keep tight control of your campaigns and the ability to make quick changes, manual bidding is the best strategy. 

What is Google Ads Automated Bidding? 

Automated Bidding is a bid strategy that’s designed to maximise the results of your campaigns based on what you want to achieve for your business. 

Google will set the bid amounts for your ads based on the likelihood that it will result in a click or conversion. This strategy uses data such as device, operating system, time of day, demographics and location to determine which users are most likely to engage with your ad when searching a particular keyword.

Automated Bidding is designed to solve two main issues that advertisers have with their campaigns: 

  1. They don’t understand whether their bids are high enough to compete 
  2. They don’t know whether their bids are too high and showing to people who will not convert 

Google uses past data from your campaigns and learns over time what’s likely to work for your ads and what isn’t to determine future performance. 

You can automate the following elements:

  • Position on SERP 
  • Clicks 
  • Conversions 
  • Conversion value (revenue) 
  • Views 
  • Impressions 
  • Email opens 

Automating your bid strategy will save a huge amount of time and allow you to manage your campaigns much more efficiently. However, remember that Google is unable to take factors such as recent events, media coverage, weather, flash sales or changes in your market so this might be where manual bidding comes in. 

When should you use Automated Bidding? 

If you have multiple campaigns running, you can choose which will be run by Automated Bidding strategies and which will not. You might want to maintain tight control over one campaign but be struggling to get another to perform which is when you might want to implement automated bidding, 

There are a number of objectives you can use when it comes to Automated Bidding. The strategy you choose will depend on your business goals and what you want to achieve. 

  • Maximise clicks 
  • Maximise conversions 
  • Maximise conversion value 
  • Target impression share 

Smart Bidding 

Smart Bidding is often confused with automated bidding, but the two are different, so it’s important to be aware of this to get the most from your campaigns. 

This strategy uses machine learning techniques to maximise conversions by tracking and analysing data from every search and click performed. Google uses this data to adjust bids based on whether or not it thinks it will result in a conversion. 

This helps you to reduce wasted spend and find the most profitable opportunities for your business. To use Smart Bidding, you need to have conversion tracking enabled to allow Google to see what people are doing after interacting with your ads. This is essential for working out the ROI and profit driven by your campaigns. 

In summary…

Getting your bidding strategy right will significantly improve the performance of your campaigns. Working out what works best for you and what will help you to reach your business goals may take some trial and error until you find the right strategy. However, once you get it right, Google Ads can help you to take your business to the next level. 

If you’re not sure whether your ads are performing as well as they should be, why not request a free audit, and we’ll show you where you can make improvements?

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Blog written by

Mark Skinner

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