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Bid Management


What is bid management in Google Ads?

Bid management, at its simplest, is raising and lowering bids strategically to get the best performance out of your campaigns. Proper bid management can maximize the efficiency of your budget, and also determines things like the visibility and cost-effectiveness of your ads. Understanding the nuances of bid management is essential, whether you’re a beginner or an advanced user handling large-scale ad accounts.

What's the difference between "bid management" and "bid strategy?"

Bid management refers to the overall process of handling bids, including planning, execution, and monitoring. Bid strategy, on the other hand, is a component of bid management, focusing on the approach you take towards bidding on specific platforms or for particular keywords. It’s about choosing the right tactics to meet your campaign objectives.

Learn more about different bid strategies in Google Ads →

How do I decide how much to bid on Google Ads?

If you are just starting out and looking to set your initial bids, here is a step-by-step guide to choosing those first bid values.

  1. Utilize Google’s Keyword Planner: This is a free tool within your Google account that provides a “suggested bid” for each keyword you plan to target. It can also help you identify new keywords. Enter your keywords to see the suggested bids for each.
  2. Estimate First Page Bid: Start by looking at each keyword’s estimated first-page bid. This value is what Google suggests so you appear on the first page search results page for that keyword.
  3. Increase Bid by 15-25%: Usually the estimated first page bid will get you towards the bottom of the first page, so to aim for mid-page visibility or higher, you need to increase the estimated bid. Start with 15-25%, which ensures visibility without immediately driving up costs.
  4. Make Incremental Changes: Improve your Quality Scores and incrementally increase your bids to aim for higher ad positions, keeping in mind your cost and performance goals.

How do I optimize bids on Google Ads?

How you optimize bids can vary depending on your specific goals and situation. A common objective in bid management is reducing your cost per action (CPA), which is the amount you pay to achieve a conversion. Here are a few common scenarios:

  • For High-Converting, Low CPC Keywords: If a keyword has a high conversion rate but a low average CPC, consider increasing its max CPC bid. This increases visibility of high-performing keywords, and potentially drives more conversions.
  • For Low-Converting, High CPC Keywords: If a keyword has a high average CPC but poor conversion rates, consider lowering its max CPC bid. This approach can improve your ROI by reallocating budget to more effective keywords.
  • For High CPA Keywords, in Top Position: Consider reducing bids to decrease CPAs, accepting fewer but more cost-effective conversions.
  • Lower Than Goal CPA Keywords, in Low Position: Increase the bid to boost ad position, visibility, clicks, and conversions.
  • Adjusting for Time-Specific Performance: If you know certain hours yield low traffic, modify your bids to capitalize on peak performance times. For example, a store that sells shoes can increase bids during hours with higher foot traffic.

Best practices for successful bid management

Effective bid management requires a blend of analytical skills and strategic planning. Best practices include thorough keyword research, regular monitoring and adjustment of bids, understanding the audience’s search intent, and aligning your bidding strategy with your overall marketing goals. Here are a few best practices to think about when managing bids:

Start With Good Tracking: Ensure that your conversion tracking, and in some cases, revenue tracking, are set up correctly and displaying accurate data. This is crucial for automated bidding strategies, which rely on accurate data to optimize beyond mere traffic generation.

Choose Your Bid Strategy: Your bid strategy should align with your campaign goals (read more about bid strategy here). In Google Ads, you can choose from Manual CPC to Enhanced CPC, CPM, Target CPA, Target ROAS, and more. Ideally, your bid strategy is based on research and a solid understanding of your goals. It is essential to have a substantial level of conversion data in the account to support the chosen strategy, especially when focused on conversions or cost per conversion.

Leverage Automation When Appropriate: With accurate tracking and conversion data in place, you can use automated bidding tools to optimize bids in real-time. One thing to remember: while automated bid strategies offer convenience, they often reduce the number of manual controls available. This includes bid adjustments based on time-of-day, location, device, and demographics. Make sure you understand these limitations and how they affect your ability to fine-tune campaigns.

Analyze Performance Data and Test When Necessary: Regularly review metrics like CTR, CPC, conversion rates, and ROAS to inform your bidding decisions and be ready to change your strategy when necessary. Regularly reviewing and potentially experimenting with different strategies (or variations within a single strategy) can provide valuable insights. Tools like Google Ads Campaign Experiments can be instrumental in testing and identifying the most effective strategy for your campaign.

8 bid management mistakes to avoid in Google Ads

Adjust Bids for Mobile Users: It’s 2024 and some marketers *still* don’t understand how different mobile behavior is from desktop. So it’s crucial to optimize bids differently for mobile users. For example, a software app that requires a complex set-up process should bid less for mobile users since it can be much more difficult to complete the setup on a phone.

Inappropriate Bidding Strategies: Your bid strategy should align with your campaign’s primary goals, whether it’s enhancing site traffic, building brand awareness, generating leads, or driving sales. A mismatch between your objectives and your chosen strategy will lead to ineffective spend and often poor results.

Overbidding on Keywords: Overbidding quickly drains your budget without yielding corresponding returns, and can limit your campaign reach if you hit budget caps. For example: it may not be necessary or cost effective to be in the top position in Google Ads.

Underbidding on Keywords: Underbidding can negatively impact ad rank and impression share. Aim for a budget that supports a reasonable number of clicks, based on historical conversion data.

Utilize Negative Keywords: Not specific to bidding, but neglecting negative keywords can attract irrelevant traffic, leading to wasted ad spend. Incorporate negative keywords to refine your targeting and enhance the relevance of your ad traffic.

Set Appropriate Bid Caps in Automated Bidding: In automated bidding, it’s crucial to set a bid cap or Target CPA to control spending. However, setting your target too low might exclude you from valuable bidding opportunities. Use keyword research tools to set a target that is neither too restrictive nor too lenient.

Utilize Smart Bidding Effectively: Implementing smart bidding without sufficient historical data usually leads to poor performance. Begin with manual CPC bidding to establish a performance baseline, then transition to smart bidding for more targeted results.

Factor in Other Conversion Influencing Elements: Beyond bid strategy, consider the quality of your landing pages, Google’s Quality Score, your conversion definitions, search intent, and conversion timelines. Overlooking these factors can undermine the effectiveness of your bid management.

Frequently asked questions

How much should I bid on Google Ads?

Determining your bid involves analyzing several factors, including your campaign goals, budget, keyword competition, conversion rates, historical performance data and more.

Whatever bid about you decide, be sure to start slow! We recommend lower bids to start and gradually increase them based on your performance.

Does Quality Score impact the amount I should bid?

Quality Score significantly impacts your bid efficiency. A higher Quality Score can lead to lower CPC and better ad positions, as Google rewards well-optimized, relevant ads. Focus on improving ad relevance, landing page experience, and CTR to enhance your Quality Score.

Should I bid on branded keywords?

Bidding on branded keywords can be advantageous, especially if competitors are also bidding on them. It helps in controlling the narrative around your brand and can be cost-effective due to the high relevance and typically lower competition for these keywords.

✨Special tip: If you own a Trademark then you can submit a request to Google here to prevent competitors from running ads on your branded keywords if they mention your trademarked name.

What's the best way to manage bids for a large number of keywords?

When managing a large number of keywords, consider using automated bidding strategies, which use machine learning to optimize bids based on your set goals. This can save time and improve performance. Remember to make sure you have enough historical and accurate data for these algorithms to work effectively.

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