Things To Consider When Setting A Google Ads Smart Bidding Strategy

With the growing shift toward smart bidding, it becomes increasingly important to understand which bidding strategy will work best for you, and how to set and adjust your targets.

As is always the case when it comes to Google Ads, there is no one size fits all, no single answer for everyone. It depends on current and past performance, as well as your business objectives per campaign.


First, let’s cover the basics.
Here is every smart bidding type currently available on Google Ads:

Maximise Clicks – this bidding method attempts to get the most clicks it can from your daily budget. It is ideal for untested terms/new product lines where there is no historic conversion data or where traffic volume is the key priority.

Maximise Conversions – this attempts to get the most conversions out of your daily budget. When using this bidding method, you define what is to be considered a conversion in the account, and ideally, this should be a meaningful action such as an enquiry, phone call (of a minimum duration) or a transaction. Ideal for when conversions are the main objective and you are on a tight budget.

Target CPA – It is similar to maximise conversions but works toward attaining the target cost per conversion you set. Ideal when all conversion actions are of near equal value and you want to achieve a certain cost per conversion in order for each conversion to be profitable.

Maximise Conversion Value – Attempts to generate the most revenue from your daily budget.

Target ROAS – With this bidding method Google attempts to generate the most revenue from your budget while meeting the target return on ad spend. This only works if your conversion actions have values. Ideal for e-commerce sites.


Now that you know what the options are it is time to consider the implications of each and to discuss a little about how to handle them.

‘Maximise’ Strategies
The ‘Maximise’ strategies take away a lot of control from the user, leaving the machine learning to do the bidding and leaving the user to trust Google that this will improve over time as the machine learns. We’ve found this to be generally true, but knowing when and how to use each bidding strategy for maximum effectiveness is a skill in itself. While Google may tell you that you can start a new campaign off on ‘maximise conversions’ from day zero, we find that having historic conversion data significantly improves the performance of this, so it may be best to start on ‘maximise clicks’ first, then swap later.

Another thing to consider is to make sure that the conversions that are set up are meaningful. Driving loads of users to view the contact page is all well and good, but if very few of those actually fill the contact forms in or call you, then it’s not an effective use of the bidding strategy.

For ‘maximise clicks’ you can set a maximum CPC that you are willing to pay, but if you set it too low, you’ll get less traffic than you otherwise would have, with not all of the daily budget being spent. Setting it too high is impossible, as the highest you can set it to is that of the daily budget, which is what the automated bidding would use if this was not set anyway.


‘Target’ Strategies
‘Target CPA’ works well where you have a fixed value product, or are generating enquiries. To work out what amount to set your target CPA to, it’s important to know how many enquiries you need before you make a sale, and the average value of that sale. Start by analysing all the online enquiries for a quick figure, then develop your tracking so that you can split it down by ad group. In the long term, you’d set different Target CPAs per ad group, as you’ll find that some sources convert to sales more easily than others. When setting this bidding method up, the system will recommend a CPA that is similar to what is currently being achieved. When you set it to a figure lower than the current average, the result may be fewer overall conversions, but reaching your target CPA, so it is important to consider the trade-off between volume of conversions and meeting the CPA. If your current impression share is relatively low, setting a higher CPA may simply result in more conversions, however, in theory, ‘maximise conversions’ ought to get the optimum results in these circumstances.

When using ‘Target ROAS (Return On Ad Spend)’, you need to make sure that all conversions have values associated with them, or alternatively, the campaign would be using a campaign set that only has conversions with values. A typical example would be an e-commerce store that also sells over the phone. The phone calls don’t have a value against them, yet they account for half of all conversions from the campaign. In these circumstances using target ROAS would likely reduce the number of phone calls the account generates. This may or may not be a good thing; the only way to know would be to work out the average value of a phone call first. If your phone calls have a higher average order value than online sales, entering that value into the system would allow this bidding strategy to start generating more of those calls rather than fewer. When setting this up, Google will recommend a ROAS that is similar to what the account is currently achieving. When you set it to a figure higher than the current average, the result may be fewer overall conversions, but reaching your target ROAS, so it is important to consider the trade-off between volume of sales and ROAS. If your current impression share is relatively low setting, a higher ROAS may simply result in more conversions and more revenue at the target ROAS.


Shared Bidding Strategies
If you have multiple campaigns that share the same objective but different daily budgets, it would be worthwhile to create a shared bidding strategy. This strategy allows you to use one bidding strategy across multiple campaigns, meaning that, rather than each campaign having its own machine learning, all the data gets pooled together. This can be beneficial, as the more data the machine learning has, the faster it can learn, and the better the decisions it can make.

Of course, if this all sounds like too much then you can ask an expert agency like Ascendancy to help 😉

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