Smart Bidding uses Google’s AI to optimize for conversions or conversion value in each and every auction. Target CPA, Target ROAS, Maximize conversions, and Maximize conversion value are all Smart Bidding strategies that include auction-time bidding.
They work with machine learning to continuously optimize your campaigns for the best results depending on the campaign goals you have set.
It’s worth noting that while Smart Bidding can be highly effective, it still requires careful monitoring and regular evaluation to ensure it aligns with your specific business goals and objectives.
How to make Smart Bidding work for you?
For starters, here are 4 ways.
1. Generate enough historical conversion data.
You need to generate enough historical data to make better decisions and optimize your campaigns. If you do not have enough conversions then the smart bidding algorithm will not work as expected.
2. Put a sufficient budget.
If your budget is limited, the algorithm may have fewer opportunities to make adjustments and find the most effective bidding approach. This can potentially limit the performance improvements that Smart Bidding can deliver.
3. Monitor the performance of your campaigns continuously.
Focus on key metrics such as conversions, cost per conversion, conversion value, and ROAS, and make adjustments to bidding strategies or campaign settings as needed.
4. Use conversion tracking to make informed bidding decisions.
Accurate tracking is crucial for Smart Bidding. Along with that, you need to let Google know the right value of each conversion.
As you can see, there are some very important things to note to get the best out of your Smart bidding campaigns. But managing them day in and out is not so easy.
5 ways to manage Smart Bidding Campaigns
Let’s see how you can manage them in an easier way.
1. Running experiments
It’s better to test what’s working and what’s not with a few experiments initially. Here’s how you can: Express optimization to create an Experiment to test Maximize conversion value, Target CPA, or Target ROAS bidding strategy.
This tool checks Google’s recommendations and lets you create trial campaigns to test the effectiveness of your smart bidding strategies with targets.
Once you create the trial campaigns, you can monitor their performance on the Campaign Experiments tool and get recommendations to turn the experiment you’re running into a campaign, if it is showing promising results.
Once the campaign starts running with smart bidding, you need to give Google the right set of information to make decisions.
2. Building a campaign structure
1. Select the right bidding strategy based on your business goal.
Use Maximize Conversions and Target CPA if your goal is to increase sales or leads.
Use Maximize conversion value and Target ROAS if your goal is to increase profit.
2. Find keywords that can drive conversions.
Broad match keywords can help you attract more visitors to your website, and allow the Smart Bidding machine to discover new opportunities for conversions. However, make sure to monitor broad match keywords to check if Google is really showing your ads for the right queries.
Identify search queries that are driving traffic to your account.
Find search terms that are sending you traffic without having to go through the entire Search Terms Report using the Search Terms N-Grams tool. This way, you can also make sure you don’t miss out on long-tail search terms.
Identify high-performing search queries for your account based on the search query report or Keyword Planner and add them to your ad groups as keywords.
The Keyword Lasso tool automatically analyzes search terms and suggests high-performing search queries that should be added as keywords (but are not already present in your account) to your account.
You can reduce clicks that are driving high costs but no conversions in the following two ways.
Add search terms as negative keywords in account negative lists.
You can use Optmyzr’s Negative Keyword Finder (Search) to identify individual words that are part of the search queries but are not performing well. These can be turned into lists that can be linked to campaigns to make it easier to manage traffic.
If you are interested in managing negative keywords even more closely, you can use Optmyzr’s rule-based optimization that you can customize and automate to your preference. It even identifies non-converting search terms and adds them as negatives at the ad group level.
Once you structure your keywords, you then create relevant RSAs for your campaign.
Optmyzr can help you find the ad groups that have no active RSAs and help you create them easily. You will see a list of different ad groups across different accounts to add RSAs.
Managing bids(targets) and budgets is a crucial part of managing your smart bidding campaigns.
As discussed above, a limited budget can restrict your ads from showing to the right people and bear losses for you. Hence, it’s important to know if your monthly budget is good enough to make sure your ads are being shown enough.
With the Spend Projection tool, you can analyze spend data, historical seasonality, and recent performance to predict how much your account is likely to spend by the end of a certain time period. You can also monitor the daily spending and understand future projections about how your campaign should spend its budget in order to meet the simulation budget.
You can just analyze the projection and make changes as you see fit or, use the Optimize Budgets tool to reallocate the budget where it’s needed the most.
If you like a rule-based way to manage daily budgets for the campaigns based on their performance, you can use the Rule Engine to automate this flow.
Optimizing for budgets is just half the story. It is equally important to optimize for the campaign and/or ad group targets. Rule Engine can come in handy here too, where you can choose to modify campaign or ad group targets based on the performance. And, if you are working with portfolio bidding strategies, Rule Engine also helps you identify the ones that are limited by the max or min limit and change their limits.
Also, if you are interested in going one step further you can work with bid adjustments or seasonality experiments. For Maximize Conversions, device bid adjustments work as adjusting the targets themselves, for the rest of them you can choose to opt out from showing ads on a device by setting -100% bid adjustment.
To know more about what bid adjustments work with which bidding strategy, refer to thisarticle.
4. Managing targets and exclusions
Creating a proper campaign structure and managing bids and budgets helps you to make sure that when customers are looking for something you sell, your ads are shown. However, that doesn’t help you control where your ads are shown. Should they appear on YouTube channels? Should they be shown in New York City? Where should they not be shown?
Here are some targeting and exclusions that can help you get started:
1. Exclude the placements that are not converting for you at the ad group or even at the account level.
2. Target a certain set of placements that are working well for your ad groups so that the ads are shown at these sites or apps using Rule Engine.
Exclude the locations from campaigns that are not giving you good returns and are proving rather expensive using the Rule Engine.
3. Exclude universally poor-performing placements from your accounts to reduce wasted spend using the Smart Exclusions tool. Reach out to our support team if you’re interested in getting early access to this tool.
4. Keep your audiences in sync with your business data and Google’s audience repository using the Customer Match List Updates tool.
You would have noticed how bid adjustments have very limited options when it comes to smart bidding strategies. So it becomes rather difficult to define how a particular demographic segment should be recorded.
The answer to this problem is conversion value rules. Value Rules are set at the account level. The rules can be based on location (physical or location of interest), device, or audience.
Optmyzr helps you better express the value of your conversions as they relate to your business and easily adjust those values based on geographical location, device, or audience during auction time bidding in real-time. You can feed your offline business data through the Segment Scorer which in turn helps in the adjustment of value rules.
Setting up conversion value rules also helps in optimizing your account’s performance by teaching Google’s automation (like those that handle Smart Bidding to optimize Target ROAS and Maximize Conversion Value) more about your business.
Adaptability is the name of the game in PPC. Platforms bring new updates and market conditions fluctuate. You don’t want to be caught by surprise when things change fast. You can use our content library to navigate those changes. Here’s some reading to get you started:
So these are some tips to help you manage smart bidding campaigns easier. We’re sure at least some of these tools can come in handy for you.
Thousands of advertisers — from small agencies to big brands — around the world use these tools to manage over $4 billion in ad spend every year.
Sign up for our 14-day free trial today to give Optmyzr a try. You will also get the resources you need to get started and more. Our team will also be on hand to answer questions and provide any support we can.
Not all clicks are created equal — some are more likely to convert than others. In the days of manual CPC bidding this meant that PPC specialists had to adjust bids to account for these differences in expected conversion rates. They might have set geo bid adjustments to bid more in Germany and less in Switzerland or to bid higher on mobile devices than on desktops.
But then Smart Bidding (Google’s name for its most advanced version of automated bidding) came along and many bid adjustments stopped working the way advertisers expected. We covered how different bid adjustments interact with different bid strategies in a previous post.
Let’s see how Value Rules, the shiny new toy from Google Ads, works to restore bid adjustments for automated bids and, most importantly, how to use this new tool correctly for optimal results.
You can now adjust conversion values based on characteristics like location, device, and audience to help optimize your campaigns!
Value Rules let you set bid adjustments for Smart Bidding
Value Rules were announced at Google Marketing Live 2019 and finally came out of beta in late summer of 2021. Value Rules let advertisers create rules to adjust conversion values whereas bid adjustments simply adjust CPCs. So how then are Value Rules a replacement for bid adjustments you might ask.
Remember that smart bidding automatically sets the appropriate CPC bid every time a search is done for your ad. This real-time bid is based on the expected value the click may produce and the advertiser’s target return on ad spend (tROAS).
In a simple example, if Google expects the click has a 10% chance of leading to a $100 sale, then that click is worth $10 (0.10 * $100 = $10). Combine that with a tROAS of 200% (i.e. make $2 for every $1 spent on ads), then the CPC bid will be $5 (i.e. this $5 click is expected to create $10 of value).
For this auction:
Click’s value is estimated at $10
tROAS is 200%
Automatically set a bid of $5
If user clicks, advertiser pays up to $5 and is expected to get $10 of value, hence ROAS is 200%
With Value Rules, you could tell Google that the conversion value would be double. By doubling the conversion value in the example above, you will end up setting double the CPC.
For the same auction, now with a Value Rule:
Value Rules says conversion value is double
Click’s value is estimated at $20 instead of $10
tROAS is 200%
Automatically set a bid of $10 instead of $5
If user clicks, advertiser pays up to $10 and is expected to get $20 of value, hence ROAS is 200%
As you can see, a Value Rule that doubles the value reported for a conversion is effectively the same as creating a bid adjustment of 2x.
Don’t use Value Rules the same way as bid adjustments
Now here’s the important thing. While you could use Value Rules as a straight-up replacement for bid adjustments, you should NOT because you’d be doubling up on what Google’s automated bidding is already doing for you.
Remember bid adjustments are way to manipulate bids when you’re doing the bidding process manually so let’s review that manual process for a minute. First, how are CPC bids typically derived? Say you expect 10% of clicks to fill out your lead gen form, and each form fill is worth $100 to your business, then your CPC bid would be $10 (0.10 * $100).
Next, how are bid adjustments decided? You’d look at your conversion numbers in Google Ads and notice that customers in Germany convert at a 20% higher rate, 12% instead of 10% of the time. So you set a +20% bid adjustment for clicks from Germany. Hence your $10 bid becomes a $12 bid when the user is in Germany (0.10 * 120% * $100 = $12).
Now here’s the rub… With smart bidding, Google already knows this difference in expected conversion rate so it will already set a $12 bid. This is true because the data you used to decide a 20% bid adjustment is the exact same data Google already gets from you when you use conversion tracking.
The bottom line is that creating a Value Rule to adjust bids based on expected conversion rates will simply stack bid adjustments and get you to bid incorrectly. So please don’t.
Remember, Google removed Broad Match Modified keywords because 95% of advertisers were using it wrong and getting results that weren’t intended. Let’s not go down that same path.
How to use Value Rules to optimize PPC campaigns
Value Rules are tremendously useful as a form of bid adjustments for smart bidding if you use the right data to create your rules.
A good rule will be based on something you haven’t told Google.
It turns out that there’s a lot advertisers know about their business that they’re not communicating to Google through the conversion tracking pixel, seasonality adjustments or different targets.
Let’s go back to our example with German customers. While we already told Google they convert 20% better than typical, what happens after the conversion? Do they typically have a higher lifetime value? Or do these conversions result in more store visits because you have more stores per capita in Germany than in other places?
We started with ‘not all clicks are created equal’, now we have ‘not all conversions are created equal’. Value Rules give us a way to communicate these differences in conversion quality.
How to use Value Rules
Value Rules are set at the account level. The rules can be based on location (physical or location of interest), device, or audience.
For audience, advertisers can choose between who the user is, what they’re interested in, what they’re actively searching or planning, and how they’ve interacted with your business.
Rules can be based on just one of the three types of segments, or combinations of up to two segments. Once advertisers pick the types for their first rule, all other rules must use the same two segment types. For example, if the first rule combines location and audience type, then all following rules must also use location and audience and it won’t be possible to create rules using device types.
There is a nice preview of rules, and the ‘If x, Then y’ methodology should already be very familiar to Optmyzr users of our very powerful PPC Rule Engine.
The action of a rule is to manipulate the reported conversion value by incrementing it by a set amount or multiplying it by a certain factor.
For example, if a user is located in the US and works in the tech industry, then add 5 to the value that was reported by the conversion pixel. Or, if a user is located in the Netherlands and regardless of audience, then multiply the reported value by 0.8.
The resulting rules will look something like this in Google.
Alternatives to Value Rules
As I’ve explained before, Value Rules are a less precise way to communicate conversion quality to Google than alternatives such as offline conversion tracking or value adjustments. But they are much simpler to use than the alternatives so they’re a great next step for advertisers who previously haven’t optimized their accounts by optimizing how they report conversions.
Value Rules in Optmyzr
Optmyzr will have an innovative new approach to creating Value Rules very soon, so drop our support team a line if you’d like to be one of the first to test it out.
Google Value Rules FAQ: How It Really Works
Updated August 26, 2021
Google’s Value Rules are a great feature for advertisers who want more control over automated bidding but who don’t want to set up the more complex offline conversions or value adjustment systems.
We got several questions related to this feature so here’s a roundup of the most popular ones. We’ll continue to amend this post as new information about Value Rules becomes available.
Do reports show different conversion values when using value rules?
Yes, the ‘conversion value’ column will show adjusted values throughout your entire account for search, shopping, and display campaigns.
This means that if you send reports to your boss or client with conversion values, these values will be ‘incorrect’ after enabling value rules. How you define ‘correct’ is up to you but there will be a change in how values are calculated and this could create issues with reporting.
We recommend having a conversation with your stakeholders before enabling value rules. Alternatively, you can use automated reporting tools like those offered by Optmyzr, to use value rules to improve bidding (using adjusted conversion values).
Are conversion values retroactively updated?
Values start being adjusted from the moment you create your value rules. Previously reported values will not be changed.
How can I see my original conversion values?
To see the unadjusted conversion values, in other words, the conversion value as if you had no value rules, enable the segment “Conversions → Value Rule Adjustment” on the account or campaign overview page.
After doing this, you’ll see a new segment for “original value (no rule applied) for any account or campaign that has a non-zero conversion value.
If a conversion satisfies multiple value rules, which one is used?
Amy Bishop explained this really well in her post about value rules. This is the order in which rules are applied:
For locations, the rule for the most granular location is used i.e. the rule for San Francisco takes precedence over the rule for California.
For audiences, Google will try rules in the following order:
Customer Match
Remarketing & Similar Audiences
Affinity & In-Market Audiences
Detailed Demographics
If there is a tie in an audience segment, Google will choose a rule using the “multiply” logic over the “add” rule.
If any other tie remains, they will choose the rule with the highest adjustment.
Is there really a 1:1 relationship between a bid adjustment and a value rule?
Nice article Fred, thanks. I'm wondering though, is the conversion modifier and bid modifier confirmed by Google to be a 1:1 relationship? I'm a bit doubtful about that. -->"By doubling the conversion value in the example above, you will end up setting double the CPC."
This is a great question from Mike Ryan who really knows the details of PPC. And he’s right that setting a value rule is not necessarily the exact equivalent of setting a bid adjustment.
Here’s why: Value rules change the value of a conversion that is reported to Google. Google’s machine learning algorithms then use these self-reported conversion values to predict the probable value of future conversions.
But remember Google considers over 500,000 signals from each auction to make this prediction.
And while the advertiser may have adjusted the value they reported because they really like conversions from California, the ML system may instead find other factors (like time of day) that correlate with these high conversion values. Rather than bid higher because the user is in California, it bids higher because the user is searching at night.
Value rules are set at the account level and change the values for all reported conversion values for search, shopping and display campaigns. The rules will change the values regardless of the bid management style of the campaign.
If a campaign is using tROAS, maximize conversion value or is a smart shopping campaign, then the adjusted conversion values will impact how Google determines bids. They will continue to consider only those conversion actions included in conversions (this is a setting for each conversion action).
What is the range of allowed adjustments?
A rule can change the original value of a conversion by a factor ranging from 0.5x to 10x. Alternatively, advertisers can choose to add a static value to a conversion that meets the conditions of the rule.
It seems a bit counter-intuitive, but there really are things every advertiser knows that Google doesn’t – like how people act after they’ve converted from one of your Smart search or shopping campaigns. These are things like:
Customers who made a purchase but returned all or part of their order
People who submitted a form and took 12 actions outside of Google’s sight before converting
Loyal buyers who split repeat purchases between digital and in-store
There’s no question that Smart Bidding and offline conversions have completely changed advertising, but are you one of the few who feed information back to Google to get the most out of those systems?
Ad platforms like Google are automating rapidly, but they need all the information you can provide to speed up machine learning and make better decisions on your behalf. If you want to your ads in front of people who will give you profits instead of just sales, you have to rethink the way you perceive PPC optimization.
We sat down with two people at Google who understand this process best:
Emi Wayner, Platform Partner Lead, Channel Sales
Alex Ioch, Regional Product Lead, Automation
Alex is part of the team that builds the products at Google that enable this new wave of search advertising, and Emi helps businesses adapt to the new realities.
We talked about how to use offline conversions to get better leads, why non-retail models need to import post-conversion data, and how to run Smart Bidding to its full potential.
Customer data is the key to sustainable growth.
A study by Boston Consulting Group indicates that online advertisers see average gains of 20% incremental revenue and 30% cost efficiency when they integrate strategies with customer data across the purchasing journey.
Whether you choose to import or track offline conversions, there aren’t many arguments against the importance of first-party data when optimizing modern PPC campaigns.
Just remember that phased growth is the only way you can achieve results with any of these recommendations.
Automations like Smart Bidding require a considerable volume of manual conversions before they can begin making the right decisions for you. Lay the groundwork with manual optimizations, and allow at least two weeks for learning. That goes for search as well as shopping.
In other words, don’t expect huge gains from your campaign metrics within days of feeding in customer or post-conversion data.
Don’t measure everything. Here’s what to focus on.
While Google Ads can measure online activity, sometimes a user who clicks on your ad and enters your sales system converts offline where Google can’t see it, like your CRM or in person.
So there are two groups of components you want to keep track of.
Online: leads & sales
When you track only leads, you get a fair idea of the initial demand for your product or service. Extending tracking to the final sale gives you a better picture of your overall purchase journey:
How much interest does your brand generate online?
How long can you sustain that interest?
How well can you persuade people to give your business money?
Sometimes, even the final sale happens offline. And in these cases, it’s critical to feed that information back into Google Ads with offline conversion imports.
But even if you were to track both leads and sales online, you’d still only see a part of the picture. If a university gets 2,000 requests for information that ends up with 20 enrollments, all they know is they have a 1% conversion rate.
But what about all the other stuff that happens in between? How much did that contribute, if at all?
Offline: The middle funnel
There’s usually a big disconnect between what advertisers tell Google to track and what actually matters to their business. An online form submission is easy to fire a pixel on; you can’t do that for things that happen offline or on a channel that isn’t trackable.
But when you do measure what happens between lead and sale, you get a better idea of what actions are most profitable for your business. Let’s take the same university example Google showed on PPC Town Hall:
2,000 requests for info yield 200 applications started (10% conversion rate)
200 applications started end with 80 applications completed (40%)
80 applications completed lead to 20 students enrolled (25%)
All of a sudden, you can see more of what impacts the final conversion. When you feed that information back to Google is when the magic really happens.
It’s okay to estimate expected value.
When you import offline conversions into Google Ads, it helps to be able to assign values to them based on what level of value they contributed to your business.
The best way to do that is to work backwards:
You know that a student who enrolls contributes an average of $10,000 to your university
You account for some fluctuation and tell Google that a completed application is worth $2,000 (25%)
A started application is then worth $800 (40%)
And a request for info is worth $80 (10%)
These numbers make it easier for Google’s algorithms to piece together the signals that make a user worth $80/$800/$2,000/$10,000 to your university.
Important: “Don’t get hung up on the numbers,” Alex says. Conversion values are a tool to help Google score and prioritize different users, and these numbers do not directly impact your ad spend or ROAS.
Smart Bidding works best when it has offline data.
When you use Smart Bidding without offline data, Google will look at tens of millions of signals that are familiar to most online advertisers:
Demographics
Conversion rate
Audience segment
Browser
Language
Keywords
Bids
Time
Location
And much more
But when you import offline data, you can feed so much more information to Google that it uses to optimize future targeting. In the case of a university, this might include parameters like:
SAT scores
Preferred courses
Income
Credit history and score
Referrals and awards
Existing credits
All of a sudden, the jigsaw Google puts together of your ideal customer gets a bunch of new pieces added to it. They can tell with greater accuracy which bids to which clusters of users will give you the best long-term returns.
Value-Based Bidding strategies let you optimize Smart campaigns.
For education, that could look like assigning different values to students who request a brochure and ones who sign up for a free online course. In retail, it might mean segmenting customers who make frequent returns from those who end up keeping their purchases.
A value-based bidding strategy tells the Smart Bidding algorithms that one group of users/customers is worth more to the profitability of your business than another.
And so Smart Bidding then knows to optimize for the group that is worth 2x/3x/10x more to your bottom line, giving you greater value from your ad spend that goes beyond just ROAS.
Additionally, fixed-value bidding skews your spend and limits your returns. User segments with a higher average bid than your fixed value become missed opportunities, while you over-invest in segments with lower average bids.
Monitor. Intervene. Educate.
There’s no shortcut or a way around the work. Finding sweet spots for ROAS and CPA targets take time, so don’t resist or be intimidated by the learning process. Test your ideas, monitor the outcomes, and optimize as you hit subsequent rounds of statistical significance.
At no point should you keep Google’s machine learning algorithms in the dark, even if data visibility is something all advertisers would like more of from the platform. It only impacts your business negatively; Google’s automation will grow with or without your accounts.
Once you know what works, automate the solution and keep control over how and when you feed information back to Google. A third-party tool can make monitoring and intervention easier and limit damage from malfunctions in the ad platforms.
Optmyzr offers a 2-week free trial that’s helped teams like Sean’s preserve their time and mental fortitude for what matters, allowing them to double their managed ad spend.
Bid automation is one of the biggest potential time-savers in PPC. Machines are simply faster and more reliable than humans at constantly updating bids based on hundreds of factors influencing conversion rate and conversion value per click.
But what if you’re not seeing the results you were hoping for? It could be that the bid automation isn’t the problem but that you didn’t give it all the information needed to make smart decisions.
For example, when you reported a conversion and told Google that the customer spent $100 in your online store, could you have shared better data like how much was returned and how much profit you made from the items the customer kept?
The point is, you can never go hands-off with any kind of automation. Instead, what you should do is limit the time you are involved.
Optimizing in this way by manipulating conversion values is a newer territory for many advertisers. The value data already flows through conversion tracking, and using that as an optimization lever has traditionally not been top of mind for many advertisers.
Optimizing conversion value should be a priority in a more automated PPC world, and there are 3 options Google offers advertisers. In addition to working with your own web development team, these are, of course, to send the value you want to Google through the conversion pixel in real-time.
So let’s take a look at the 3 options to share better data with Google’s machine learning systems about the value your PPC ads are delivering
Option 1: Offline Conversion Import (OCI)
Offline conversion tracking (or Offline Conversion Tracking) is the original way to tweak conversion data after something has already happened on your site.
It was primarily built for lead gen advertisers. But it’s surprisingly useful for eCommerce advertisers too. The idea is to capture a click identifier (called the GCLID or Google Click ID) and hold on to that in your own system until you’re ready to report that something desirable happened from that click.
At that time, you can send Google the GCLID, the conversion, and a value, and they are then able to connect that with all the attributes of the click.
That means the Google machine learning system can then start to figure out if any patterns correlate with users who tend to take the desired actions.
So, for example, if they notice many people from Germany convert and return high values for lower click costs (hence delivering high ROAS), then the automations may decide to try to get more clicks from Germany.
With OCI, you can’t restate values, but advertisers can create new conversion types and add them to ‘conversions’ where Google’s smart bidding algorithms will use them.
In lead gen, that could mean creating offline conversions for ‘qualified prospects’ after a salesperson speaks with the prospect on the phone and a ‘closed deal’ when that prospect eventually purchases from their sales rep.
Retailers can also benefit from this capability by nudging Google’s systems towards what they believe to be better customers.
For example, creating a secondary conversion based on a scoring model predicts a customer’s future purchase behavior with the retailer.
OCI is particularly useful in this case because it may not be possible to calculate that lifetime value component in real-time while the user goes through the checkout process. When it is calculated, later on, it can then still be communicated to Google.
Option 2: Conversion Value Adjustments
This second option of adjusting conversions is generally less known but it’s actually an easier to implement variation of OCI.
Rather than capturing and storing the GCLID, advertisers can add a transaction ID to their existing conversion tracking code from Google at the time of the initial conversion. Then they have 55 days to restate the value of that conversion.
Here’s an example of how that could work. The advertiser sells $100 worth of goods, but $40 of goods are returned by the consumer before the return window closes. The initially reported value of $100 can now be restated by telling Google the original transaction ID of that sale and the new value, in this case, $60 ($100 - $40 which was returned).
By doing this, Google’s automations may come to realize that people in Germany return more stuff than those in the UK and appropriately tweak its decision-making process to account for that factor.
While this system was designed to help retailers, lead gen companies can also benefit from it.
For example, they could retract a lead from someone who filled out a form but then never took advantage of the free trial offered by the sales team.
Option 3: Conversion Value Rules (beta)
The last option to teach the machine about value is to deploy conversion value rules which are currently in beta testing from Google.
This is a less precise methodology because it doesn’t allow advertisers to tweak individual conversions. It does however allow advertisers to tweak conversion values based on some high-level attributes that they may have already correlated with desirable behaviors.
As in the previous example of buyers in Germany and the UK, they could boost their reported conversion values for users from the UK because they do fewer returns. Other attributes around which these rules can be built are device types and audiences.
Conclusion
Smart bidding can seem like a better alternative to letting Google do the heavy lifting for you. It’s perfect for automating the more tedious parts of PPC management so that you can spend time on strategy.
Note: Smart Shopping campaigns have been upgraded to Performance Max in September 2022. We suggest you refer to these links below to know more about Performance Max.
If you’ve ever used the Smart Shopping feature in Google Ads, you know how easy and quick it makes e-commerce. Smart Shopping campaigns are easy to set up; all it needs is for your merchant feed to be up and running.
But there’s always a catch. In this case, it’s little to no visibility into traffic and which products are driving business to your campaigns. In other words, it’s a black box solution.
As Tinuiti states in this blog post (super useful if you’re not totally sold on Smart Shopping and want to figure out when to use it):
“Smart Shopping campaigns provide no search term data and no audience data, while it also only indirectly provides placement data (for display ads), individual product performance. The lack of data means that advertisers have no ability to set ROAS or CPA goals based on search intent, type of user, type of ad, or type of product, and cannot control where their advertising spend is allocated to.”
But if you’ve done your research and believe that Smart Shopping is the ticket, try these 6 optimizations to gain more control over your shopping campaigns.
1. Segment products by ROAS performance
Smart Shopping lets you set a target ROAS at the campaign level. Unless most of the products in your feed have a similar ROAS or price, it’s a good idea to segment them into different campaigns.
You can create campaigns for your products by brand, product category, or custom labels. Or in this case, by their ROAS performance—so that products with similar performance have the same target ROAS.
This helps get better results for your entire inventory instead of averaging performance across all products. Multiple campaigns also let you allocate more granular budgets. For example, you might give a bigger budget to a campaign with products that have over 150-200% ROAS.
Optmyzr Tip: If you’re not sure how to structure multiple campaigns by ROAS or another attribute, use our Shopping Analysis tool to break your current Smart Shopping campaigns down by any attribute.
2. Build groups of individual products (GRIP)
While you can’t create multiple ad groups in Smart Shopping campaigns, you can create multiple product groups using the GRIP structure. This puts one product per product group, letting you ultimately exclude products that aren’t profitable for online retail.
One cool thing Optmyzr lets you do is apply the GRIP structure to your current roster of products. From there, advertise the less profitable products in a standard shopping campaign where you have greater control over bids, budgets, and negative keywords.
3. Spend wisely
Another benefit of having multiple shopping campaigns is that you can put bigger chunks of your ad spend into better-performing entities. So if your high-ROAS campaign is doing well but is losing impression share due to budget, fire it up.
You might also consider increasing or decreasing budgets based on the seasonality of your business experiences. If you’re running a sale over the weekend or during the holiday season, increase your budgets to get more traffic, and then scale them back after the sale is over.
Optmyzr Tip: The Optimize Budget tool lets you manage and improve Google Ads budgets easily. It translates your budgets from monthly to daily levels, which can help you hit a target or put more money behind campaigns that are driving the best conversions.
4. Adjust seasonal bids
Use the seasonality adjustment in your Smart Shopping campaigns to adjust for any upcoming short-duration events, like Black Friday weekend or the Christmas-New Year’s bridge.
Apply a predicted conversion rate adjustment based on your past experience during a similar period, and Google will consider it for that particular period. Google will also exclude data during the adjusted period so that unusual conversion rate patterns don’t affect future bids after the seasonality event ends.
This is especially important because Smart Shopping relies so heavily on these signals. Any fluctuations that aren’t identified as such can adversely affect your future campaigns and how much you’ll pay.
5. Don’t overlap products
When it comes to avoiding overlap, we recommend focusing on the category level first. So if you sell sporting goods, put all sneakers/trainers in one type of campaign, all compression wear in another, and so on.
If you split your sneaker SKUs partly into a Smart Shopping campaign and partly into a standard shopping campaign, then Google may heavily skew impressions towards the subset of sneakers in the first.
To understand this better, think of any search that is not for a specific product e.g. “white men’s sneakers”. With any degree of non-specificity, Google will simply find a close-enough match from the Smart Shopping campaign and ignore a potentially more relevant close-match from a standard campaign.
And last, but not least…
6. Understand your Smart Shopping goals
In other words, know what your campaign needs to be optimized for before you structure it. We recommend these tips to better manage your campaigns according to different end-goals:
• Maximize revenue or profit: Combine max products into a single campaign to drive sales and maximize conversion value.
• New product launches: Hero products or new products in a Smart Shopping campaign with low ROAS, with enough budget to get traffic, visibility, and impression share.
• Creating different campaigns: For products with different sales and margin targets, create separate campaigns for each grouping to make sure that part of your investment goes to these categories.
Remember, the Shopping Analysis tool in Optmyzr lets you find which products are returning a higher ROAS so you can group them into a new campaign.
And while we’re on the subject, here’s our answer to one of the most common questions we hear from advertisers.
Can we create Smart Shopping campaigns alongside standard ones?
Of course you can, but remember that Google will prioritize Smart Shopping campaigns. If you run them simultaneously, you might see a change in performance skewing away from your standard campaigns.
One way to use them together is to look at the performance of products in our Shopping Analysis tool, exclude low-performing products from Smart Shopping, and instead run them in a standard shopping campaign. This is a good way to give your lower-performing products a fair chance to perform.
So while Smart Shopping is a boon for advertisers who are low on resources or knowledge, remember one thing:
Machine Learning + Automation ≠ Better Results
But it does mean less time managing your campaigns. And while the debate over control vs. automation goes on, there’s still ways to use Smart Shopping while making it more effective and profitable.
If you don’t have access to our tools, consider signing up for our 2-week free trial. You’ll get access to all our tools, and our team would be happy to show you how to best use Optmyzr to achieve your goals.
For any other questions and product support (or to see a demo first), write to our team at support@optmyzr.com.
Over the past few years, marketers have seen Smart Bidding evolve with Google’s machine learning. In fact, it seems to be a way into the future of advertising by making the best use of AI and data to provide intelligent campaign adjustments. But while Smart Bidding does automate tedious tasks of PPC ad management and save time, it’s far from a ‘set it & forget it’ mentality. To make the most of it, advertisers need to monitor and optimize to get the best results for their campaigns.
So this week on Episode 28 of PPC Town Hall, we invited our friends from Google to discuss Smart Bidding campaigns and shed light on tactics for optimization.
Our panelists for the week:
Emi Wayner, Platform Partner Lead, Google
Peter Oliveira, Partner Development Analyst, Google
You can receive the exclusive Smart Bidding guide from Optmyzr and Google by signing up here! You can also view previous editions of PPC Town Hall right here.
Without further delay, here are the 6 insights to understanding and optimizing Smart Bidding campaigns.
1. Evolution of Modern Search
Emi: What we see today is really the evolution of machine learning. I think machine learning is getting smarter with people getting more comfortable using and leveraging it to the next level for better results. We search so differently compared to what we did three years ago. In fact, 15% of queries on google.com are new every day. That means there are tonnes of queries that Google misses as well. So, we really have to depend on Machine learning to capture maximum potential with search.
As machine learning gets smarter, the data that marketers provide is really going to be the key to be competitive and achieve your goals. Not from the CPA perspective, but broader profitability and customer lifetime value.
2. Analyzing Smart Bidding signals
Peter: Google looks at billions of signals to set the bid for every auction. We’re monitoring a bunch of different things more than just the signals, like the intersection of these signals. A lot of the things that we used to optimize manually like devices, day of week, time, location, all the different keywords, etc are now being taken care of for Smart Bidding. But there are some tactics which you can use to inform Smart Bidding what are the right ways you can treat some of these things.
Emi: So this is a recent performance review using selected US accounts. When we looked at the data, Smart Bidding outperformed Manual Bidding across most of the spend buckets on Optmyzr accounts.
A lot of people should take advantage of Smart Bidding regardless of the budgets (look at the right-hand side of the chart – ‘under 500 budget’). And we see significant performance even in smaller budgets as well as larger ones (above 50k).
3. Optimizing Discovery campaigns
Peter: I have seen some very strong results with Discovery campaigns for certain advertisers. For example, I worked with a real-estate partner who was seeing better results in Discovery campaigns than in Search!
If you’re having issues with the returns and getting conversions, make sure that you’re setting the CPAs properly. Setting up unrealistic CPAs that do not represent your goals can hamper your account health. And then there’s also the flipside. If you look at our audiences to whom we are comfortable suggesting Discovery Ads, you’ll see that the daily budget recommended is about 20 times the target CPA. So, if you have a tighter budget, I’d recommend maybe doing 10 times the target CPA.
That being said, I have seen success at a lower CPA. But if you have a smaller budget, I wouldn’t be actively recommending Discovery Ads to you. Layering on audience lists like remarketing and customer matching might help you see more successful results.
Emi: We have seen a pretty good performance in the use cases with Discovery campaigns, even for a first-time mid-sized account. So I would encourage marketers to keep looking into why they aren’t giving you a good performance. In terms of how long, usually we test for a week and then we regroup with the customers, and keep doing this. So one week at a time.
4. Common mistakes advertisers make with Smart Bidding
Start making sure what goals your Smart Bidding campaign will be optimizing and those goals align with what you’re trying to achieve. I have seen people set a Max Conversions strategy on a campaign that was spending half of its budget. We didn’t see any positive results CPA-wise as Max Conversions doesn’t necessarily focus on optimizing your CPA. It looks towards getting you as many conversions as possible within your budget. And if you’re spending only half of your budget, we don’t necessarily know whether that incremental conversion will come at a CPA that aligns with your historical ones.
The other thing is the target that we set. I would advise looking into your optimization score recommendations in the front-end to see what we are recommending there. You’ll probably want to start by setting a target in line with what you’re historically performing at. If you’re historically performing at a CPA of $100 and if you switch that down to $50, you can massively end up throttling the number of conversions and sales you were getting.
Just because we don’t want to necessarily start with Smart Bidding on the exact Target CPA, doesn’t mean we can’t get there. Start with where you’re historically performing at and slowly adjust to get where you want to be.
5. Structuring a Smart Bidding campaign with segmentation
Peter: When we segment our campaigns, Smart Bidding can actually take data and learn from the performance that’s happening throughout the account. While you don’t need to segment everything, if you do end up breaking up your campaigns, Smart Bidding will be able to learn from the performance of the campaigns. The only thing that I’ll caution about is to break down to the point where there isn’t a lot of conversion volume in each individual campaign. On top of that, if you have a Target ROAS or Target CPA that your campaigns aren’t able to meet, that’s something to watch out for.
If you put more constraints on the targets and segment the campaigns, you could end up throttling your campaigns altogether.
6. Marketing as a holistic approach
Emi: We think that a marketer can play a bigger role in PPC marketing than just making strategies or directing CPC. We look at a marketer as a growth engine for the company. Strategic points like profitability and value of customers can help bring value to your work and your business. I would really encourage everyone to think more than just PPC, think of how you can bring that value to your company and leverage for more growth.
Conclusion
Fred: When you start with something, like Smart Bidding, it’s better not to shock the system and be extremely aspirational. Machine learning functions on how things have worked consistently in the past. Even if you set up higher targets, it might take a while for the system to get you there. But at the end of the day, to achieve the target you really want, it all comes down to you, the advertiser, to set up the prerequisites and feed in impressionable data. You can add a lot of value to your ongoing campaigns by not taking bidding as something that just happens by itself.
Seasoned PPC professionals make use of efficient bid management tools, like Optmyzr, to keep their accounts top-notch and optimize your bids. Try and experience our capabilities yourself by signing up for our 14-day free trial.
Some marketers fear automation, but Smart Bidding is a great example of how it actually helps.
Teeming with data and interactions, Smart Bidding uses machine learning to create optimal bid strategies. And because it saves both time and money, it’s quickly become an important part of PPC.
But there’s a (literally) dark side to it as well.
Smart Bidding means surrendering control to the black box of Google’s AI, with strategies that simply don’t allow you to tweak aspects of them to your specifications. Simply put, you input your goals and Google uses your account’s past behavior to produce results.
What do you do when you want the convenience of Smart Bidding but don’t want to give up control? You turn to a tool like Optmyzr.
Here are 10 ways Optmyzr customers use our platform to retain control when they use Smart Bidding.
Understanding how automated bidding works
The keystone of AI or machine learning is the data the system uses to make decisions and predictions. In the same vein, the success of automated bidding strategies depends on the quality of the performance data that system is able to collect. This in turn depends on how your account is set up.
The performance of badly structured campaigns cannot be improved by putting them on an automated bidding strategy.
A good account structure and the right attribution model are vital to the success of any automated bidding strategy. If you’re using last click attribution, either change to another attribution model or run manual bidding.
Campaigns that run on automated bidding strategies need to be optimized in order to have the right data to work with. In theory, the only thing Google takes care of is setting bids — only one aspect of managing an account.
The rest is still on you.
Automated bidding is not a ‘set it and forget it’ deal. However, with bidding out of the picture, you’ll have more time for other tasks — the kind of search queries you want to show for, or the messaging you want to use in your ads.
1. Search Query Management
Search queries are still the primary source of traffic for search campaigns, so it’s important to monitor the ones your ads show for so you can remove irrelevant ones (add them as negative keywords). It’s also a good idea to add high-performing search queries as keywords because you can write more specific ads for them.
Optimizing to increase Quality Score is one way to reduce your CPA and increase ROAS. Even though Google is automatically setting your bids in the auction, a high Quality Score requires a lower bid.
In other words, you pay less for each click.
Find keywords in your account with low Quality Score and move them to their own SKAGs with the more specific ads. Or, pause them if they have an irredeemable quality score of 1.
This isn’t about setting bid adjustments for different times of the week; your automated bidding strategy already does that. We’re talking about allocating campaign budgets to the more lucrative times of day by turning your ads off when they’re not profitable, making it something of a budget optimization.
Optmyzr Tools Used: Hour of Week Analysis, Hour of Week Bid Adjustments
4. Non-Converting Keywords
Pause keywords that have not converted in a long time but have accrued significant cost. This optimization should only be done if you aren’t running on last click attribution. Otherwise, you’ll pause top-of-funnel keywords and eventually reduce conversions.
You did budget optimizations before automated bidding, and you should continue to do them now. Reallocating budgets across campaigns based on performance helps improve overall account ROAS.
Check if high-performing campaigns are losing impression share due to budget, and increase their budget by giving them money from underperforming campaigns.
If you’re running on the standard automated bidding strategy (target CPA and target ROAS), you can tweak targets at the ad group level. There are two instances where I’d recommend doing this:
1. A sudden change in business or an upcoming event like a sale requires you to tweak targets. It’s a way of telling the system that you want more or less traffic when there’s a sudden change in patterns the system is unaware of. For example, if your business has a sale over the weekend and you want to drive more traffic to your campaigns, increase CPA targets over the weekend and then scale them back down once the sale is over.
2. Day-to day optimizations to increase conversions. Some common optimizations you can do are:
• Increase target CPA for ad groups that are converting but losing impression share due to ad rank. For campaigns running on target ROAS, reduce ROAS. This is the same as increasing bids for high-converting keywords when campaigns are on manual bidding. It enables Google to bid more to drive more conversions.
• Reduce target CPA or increase ROAS for ad groups whose actual CPA and ROAS are significantly better than the target and whose impression share is already more than 70%. This reduces the chances of Google buying very expensive traffic when the automated bidding system thinks there’s room to increase CPA and win more traffic.
7. A/B Testing Ads & Updating Messaging
Ad text automation is probably one of the last things that will happen in PPC — writing ads always involves subjectivity and creativity. Responsive Search Ads are a step in that direction, but they only combine headlines and description lines; you still have to write them.
This is why it’s important to continually A/B test ads — so you can remove underperforming ones and keep messaging fresh.
Optmyzr Tools Used: A/B Testing, Ad Text Optimization
8. Performance Monitoring & Alerts
Perhaps one of the most important things you can do is set up alerts to notify you of sudden changes in traffic, conversions, CPA, ROAS, or any other KPI that’s important to you.
This helps you stay on top of your campaigns, especially when something doesn’t go as expected. For example, if the CPA for a campaign suddenly shoots up, you’ll want to see why it happened and take appropriate action.
Optmyzr Tools Used: Alerts on the MCC dashboard, Rule Engine
9. Performance Audits of Automated Bid Strategies
Knowing when to pivot is critical to success, be it in PPC or any other business. It’s a good idea to regularly check on the performance of your campaigns’ bidding strategies to see if you need to pivot.
For example, if a campaign is running to maximize conversions, it might be time to move it to target CPA and ROAS. You can also see if certain campaigns on automated bidding strategies aren’t driving enough conversions and move them to manual bidding for a while.
Optmyzr Tools Used: PPC Audits, Rule Engine
10. Structural Account Audits
Regular account audits are so important for good structure. Check for things like too many keywords in an ad group, too few ads, campaigns with not enough negative keywords, or campaigns missing site links.
This ensures that campaigns in your account have a solid foundation on which automated bidding strategies can do what they’re capable of.
Optmyzr Tools Used: PPC Audits
Conclusion
We live in a world where competition is fierce and standards are demanding. PPC marketers rely on automated bidding more than ever to do more in less time. What automated bidding lacks intuition and human understanding, you can provide by optimizing your campaigns.
Help it help you.
There’s no one way to win with automated bidding, but Optmyzr offers several tools that allow you to layer your own automation over what the ad engines provide. If you don’t have Optmyzr, try our platform free for 14 days with access to all features.
The last time we sat down with Google to talk shop, the discussion found its way to managing PPC campaigns during the COVID-19 pandemic.
With supply chains disrupted and business models being tested, companies around the world are facing a variety of new conditions. And though the results aren’t uniform, what’s consistent is how every business has been affected in some way.
Many are struggling to find customers. Some are facing uncertain futures. A few fortunate ones are doing better than ever — will they struggle when things return to normal?
We put together some advice for PPC marketers that took the shape of this blog post. But in the weeks since, we’ve seen and heard the debate over automated bidding become one of the prevailing industry conversations.
Thankfully, our friends at Google had plenty more to say.
Here are their recommendations for 6 secret tips that can help you impact Smart Bidding and more reliably navigate a marketplace in flux.
6 Secret Tips to Impact Smart Bidding
As you monitor shifting trends and course-correct your business plan, you’ll also need to bring your strategic approach in line with what the current situation demands. To help you provide clients and customers with a fruitful experience without eating too much of your time, Google recommends Smart Bidding.
Let’s recap the tactics we recommended last time, as well as explore how they impact Smart Bidding.
1. Keywords
Recommended Tactics
Use negative keywords as a safeguard against undesired clicks that might drive lots of cost but no conversions.
The way users are searching for your business may have changed, which is why it’s important to capture those shifts in search behavior through broad match keywords.
When bidding on keywords with your brand name, adjust goals for Impression Share or use tCPA/tROAS.
How does this impact Smart Bidding?
Keyword optimization helps deliver more at the same CPA/ROAS goal, and ensures that brand strategies align with business goals. Broad match keywords allow the Smart Bidding machine to discover new opportunities for conversions.
Optmyzr Tip: You’ll still want to keep other match types and regularly review new search terms with tools like Optmyzr. The Rule Engine’s latest addition takes high-performing keywords with one match type and lets you add new match types at the ad group level.
2. Creatives
Recommended Tactics
Use Dynamic Search Ads to show up on new relevant searches your keywords may be missing out on.
Use Responsive Search Ads to adapt ad content to more closely match user search terms.
Make offers stand out and take customers to the right page with promo and site extensions.
How does this impact Smart Bidding?
Getting your creatives right prevents your message and customer experience are on the same page, which ensures that each bid brings relevant engagement.
Optmyzr Tip: Regulations and restrictions can change frequently. With the Ad Text Optimization tool, you can quickly and consistently change ad copy to reflect the real-world operating conditions of your business. The Add Responsive Search Ad tool is also useful to build RSAs for each of your ad groups.
The Responsive Search Ads tool lets you maximize your chances of getting meaningful clicks
3. Bids and Budgets
Recommended Tactics
Move unused parts of your budget to the ads that need it most.
Raise the budgets of campaigns that are performing well to drive more traffic.
Use Performance Planner to understand the implications of different budget scenarios.
How does this impact Smart Bidding?
Putting your marketing dollars where they’re likely to yield the best returns is PPC 101. You capture more leads at the same CPA/ROAS goal, and forecasting often captures the most recent demand trends.
Optmyzr Tip: Campaigns that worked a few months ago might not be winners today, for no fault of their own or yours. Put your dollars where they need to be with the Optimize Budgets tool. It can help you quickly re-allocate budgets based on how different campaigns are doing against your goals.
Optimize Budgets lets you see how to adjust spend to achieve specific goals
4. Target Constraints/Goals
Recommended Tactics
Evaluate your new business strategies and confirm target goals.
Set performance targets and customize settings to your unique business goals.
How does this impact Smart Bidding?
Using CPA/ROAS goal adjustments can help you control spend and volume. But to achieve the same thing for Max strategies, Google recommends using budget adjustments.
Optmyzr Tip: Use the Optimize Target CPA & ROAS on campaigns with automated bidding to increase conversions and Impression Share. You can also see converting ad groups that use other automated bidding strategies.
5. Account-Wide Best Practices
Recommended Tactics
Capture all signals using Data-Driven or Non-Last Click Attribution.
Only include conversions that are relevant to the business.
How does this impact Smart Bidding?
Smart Bidding uses account-wide signals (cross-account under MCC, if applicable). If you’re struggling to see results from Smart Bidding, it might be because you’re still using Last Click Attribution in an era of erratic search behavior.
Optmyzr Tip: The Rule Engine allows you to create data-based strategies, like removing non-converting keywords related to COVID-19. Or for a fun way to keep your account in shape, try the Workouts that combine multiple optimizations to achieve a specific objective.
6. Audiences
Recommended Tactics
Add all RSLA, Similar Audiences, and Customer Match lists to Smart Bidding campaigns.
How does this impact Smart Bidding?
First-party audience lists improve Smart Bidding algorithms, but Google lists have a neutral impact on Smart Bidding. For best results, provide your own customer information.
Optmyzr Tip: You always want Smart Bidding to have the latest and greatest information about your customers. Use the Customer Match List Updates tool (under Optimizations > Utilities) to keep your audiences in sync between your business data and Google’s audience repository.
6 Ways to Fully Control & Adjust Smart Bidding
While Smart Bidding might make PPC a bit less time-consuming, it’s far from a ‘set it and forget it’ mentality. There are many things you can do to affect the degree of control and influence you have over your bids.
Check out these 6 ways to fully control and adjust Smart Bidding.
1. Goals
Goals are the end objectives of your campaign; think of them as a destination. Tweaking goal values can change the way Smart Bidding tries to get there.
CPA/ROAS goal adjustments
Ad Group targets
Portfolio targets
Device CPA modifier
Operationalize forecasts
2. Conversions
Current market realities have impacted conversions across the board. Use the information in this space to inform your strategy and reshape the Smart Bidding process.
Conversion value adjustments
Campaign-level conversion setting
“Hack” data exclusion (seasonal adjustment)
New secondary KPIs
3. Constraints
Setting hard limits on your financials can enable Smart Bidding to look at creating value over volume. As always, keep an eye on things as you implement this approach.
Limiting budgets on purpose
Portfolio CPC max/min bid limits
4. Targeting
Audience is one of the most influential factors in PPC, and there’s no doubt that who and how you choose to target can make a difference to Smart Bidding results.
Pausing targeting
Opening targeting
Split testing
5. Budgets
At the end of the day, it’s all about the dollars. Experimenting with budgetary values can provide some of the most significant influence on Smart Bidding.
Shared budgets
Uncapped budgets
Constrained budgets
6. Misc. Adjustments
There are other adjustments you can make to shape Smart Bidding, including seasonal adjustments. We suggest exercising oversight when using some of these in today’s market.
Seasonal adjustments
Campaign structure
Split testing bid strategies
Conclusion
It’s been said before but bears repeating: There’s only one way PPC professionals can do right by their businesses and clients — by having as much information as possible. That’s why we’ve partnered with Google to bring you these posts on how to gain maximum value from the tools at your disposal.
These recommendations from Google are intended to supplement a brand’s unique business strategy. Both Google and Optmyzr suggest you balance any automated bidding strategy by keeping a close eye on your accounts. After all, only humans can provide context to the data.
And be on the lookout for the third part of our collaboration with Google, when we discuss what advertisers in hard-hit industries can do to prepare for the end of lockdown.
Machine Learning (ML), Artificial Intelligence (AI) and Automation are three trending topics in the industry today. It’s an accepted fact that automation is here to stay so it’s our job to learn how to make the most of it for our PPC accounts. In my book “Digital Marketing in an AI World”, I explain that one of the roles humans will have to play when their old job has been automated is that of the “PPC Doctor”: someone who knows the right medicine for their patient and who also understands potentially dangerous interactions. This post covers one such interaction that can lead to disastrous results in PPC.
We’re talking here about Google Ads’ smart bidding strategies. Even though they’re designed to help advertisers reach a determined goal, they lack the human intuition for understanding how to deal with gray areas, and are prone to bad decisions when they’re fed bad data. Specifically, they can do major damage to accounts that are using last-click attribution (LCA) models.
Understanding Last-Click Attribution Model
Last-Click is one of the 6 different attribution models offered by Google Ads. It gives all the credit to the ad and keyword which was last clicked before a conversion.
For example, let’s say you are advertising athletic shoes. There’s a sequence of queries done by a user that goes something like this: “Sneakers” > “Running Shoes” > “Adidas Running Shoes” and finally they search for “Ultraboost 19”. This is just a simple example to illustrate that users tend to start with broad queries and get more specific as they get to understand what it is they might want to buy.
If your campaign is using the Last-Click attribution (LCA) model, then all the credit for the conversion will be given to the ad shown for the final query: “Ultraboost 19”, and no credit will be given to any of the queries that preceded it.
Conversion Funnels and LCA
So why is this so bad? When you give all the credit to the last-clicked ad/keyword, it’s like saying you don’t think there was any value to all the queries along the way that helped the user become aware and familiar with your offering. You’re assuming the user would have discovered to search for “Ultraboost 19” without having been exposed to any of your other ads. This is generally a false assumption, especially for consumers who are not very familiar with your brand and its latest offerings.
Consumers today have more interactions than ever before with brands while researching what to buy. Brands that are not present at the earlier stages of a user’s discovery process may not be in contention to win their business later down the line.
So using last-click attribution would mean that “Sneakers”, “Running Shoes” or “Adidas Running Shoes” are assigned no value.
Attribution Models Inform Optimizations
Why is it so important to assign the correct value? Doesn’t the attribution model just change the numbers in reports? The answer is ‘no,’ the attribution model populates the conversion and conversion value metrics and most account managers rely on these to decide where to allocate their budgets, where to change bids, what queries to add as keywords, and what negative keywords to add.
This could all be okay if a human was managing all this manually. For example, while the lack of conversions for a keyword like ‘sneakers’ might normally be grounds for a bid reduction, an account manager would likely realize that they’d still want to bid for this keyword. Human judgment would win out over purely following some logical rules and the account might do fine.
But like I said before, automation is increasingly doing more of the day-to-day account management and it lacks the human judgment that averted disaster in this scenario of an advertiser using last-click attribution.
Smart Bidding + Last-Click Attribution
When last-click attribution is being used, the keywords “Sneakers”, “Running Shoes” or “Adidas Running Shoes” from the example above, will be reported as non-converting, although they are still valuable keywords because they help consumers unfamiliar with your brand discover your brand’s offerings as they do their research.
Now here’s where results can get really bad… by combining bid automation with last-click attribution. The job of automated bidding, like target CPA (tCPA) or target ROAS (tROAS) bidding from Google, is to calculate the appropriate CPC that is needed for the ad to enter the auction.
The ‘right’ CPC is determined one of two ways:
For tCPA, Google uses the predicted conversion rate to calculate CPC
For tROAS, Google uses the predicted conversion value for a click to set the CPC
But if the attribution model hasn’t been assigning conversions to upper-funnel searches, it will predict that conversion rate will be low and that the value per click will be low. So now the automated bidding system will start to reduce bids for these upper funnel keywords. And eventually bids will get so low that the ads may stop showing altogether.
This is bad because it means you’re reducing the volume of prospects who will be exposed to your brand at earlier stages. Eventually your funnel just dries up and the only sales you’re left with are those from people who already knew your brand and products very well — the people who knew to search for “Ultraboost 19”.
Final Thoughts
Considering the significant risk of making bad decisions for the reasons explained above, we advise all our customers to switch away from using Last-Click attribution. If anything, simply switch to a time-decay model which is most similar to last-click while still giving some value to all stages of the funnel.
When it comes to automations like smart bidding strategies, or automated bids using another platform, knowing how they interact with your measurement systems is an absolute must if you want to avert an account blowup.
Black Friday. Cyber Monday. After-hours convenience. Price. Easy/free shipping. All are huge motivators driving people from brick-and-mortar stores to the ease and convenience of online retail. The trend lines are unmistakable. 2018 promises to be another transformational year for eCommerce at holiday time, with many experts predicting double digit increases in online holiday shopping.
Billions of dollars will be up for grabs.
PPC pros have an unprecedented opportunity to be real heroes this year by making sure their company wins more than its share of the shopping frenzy. Working in your favor, holiday shopping is always ripe with intent and immediacy.
Semantics Matter
First, let’s briefly recap the ongoing rapid evolution of the tools at our disposal. Google and Bing are both continually enhancing shopping tools to drive that high-intent searcher to conversion. They have added core automation to streamline the basics of PPC and more advanced tools such as Shopping Ads.
Focusing specifically on the Google platform (but still keeping in mind Bing is remarkably Google’esque with PPC), we all know the greater the specificity of a person’s search, the greater the intent. “Men’s black analog diving watches” tells the Google machine a lot about the searcher’s eagerness. Google can serve up engaging Shopping Ads featuring cool black diving watches to capture eagerness to purchase, serving product-specific ads with click-to-buy ease.
The holiday shopper doing more casual digital window shopping, however, will offer less specific searches such as “Men’s watches” or more vague “gift ideas for dads.” While vague, that shopper likely WANTS to get into a funnel and may need just a little prodding to convert.
In this less-specific search, Shopping Ads and Google’s Showcase Shopping Ads can create immersive and meaningful experiences for people browsing for that perfect gift.
If you haven’t dabbled yet with Showcase Shopping Ads, perhaps you should. They provide pre-click browsing of your products to generate purchase ideas based on more general searches. Previously, PPC pros didn’t have a lot of power to draw casual browsers into their funnel. Showcase Ads are an inexpensive option to meaningfully engage shoppers of modest intent – particularly those meandering for ideas on a mobile device.
Build – Optimize – Automate – Control
While Google and Bing do a good job automating core aspects of search ads for everyday PPC practitioners, the PPC rockstar needs tools like Optmyzr to take their game to new levels. The goal is beating competitors in the second-by-second, search-by-search battle for holiday sales.
The Optmyzr system gives you greater control and automation beyond what Google and Bing offer – and it’s all managed from a single interface. Everything from building campaigns, syncing with inventory, and managing bids to choosing your preferred mix of automation/manual intervention.
Campaign Builder greatly simplifies and automates creation of product group and other campaign structures. Tapping data in your merchant feed, this tool helps automatically align structures by category and craft groups by brand, product type, etc. Campaign Builder’s easy-to-use interface gives you greater control and flexibility to analyze structures to refine and improve them prior to launch. It will also flag gaps in structure that could negatively impact reporting and analysis downstream. In other words, you catch the clunky, annoying misses that would otherwise create headaches or hamper insight after the fact.
Next, let’s talk inventory. Retailers have greater opportunity to serve up ads based on actual inventory – you know…the stuff you have on hand and want/need to sell. Whether you sell cars or speciality holiday dresses or sporting goods, accurate inventory data fed into Optmyzr allows efficient set up and management of hundreds of potential rules and parameters to serve the right ad at the right time. Through rules and automation, you can streamline processes to serve ads based on highly specific product attributes – size, color, style, tech specs. Essentially, if you have data about the products, Optmyzr drives powerful tools to serve the ads aligned with that highly specific search.
Finally, let’s cover bid management. This is where a third-party tool like Optmyzr layers exceptional power on top of the standard automations from the search engines.
The day-to-day task of managing bids can be horribly time consuming, but it’s really at the heart of taking campaigns from basic to extraordinary. For those who need to manage basic modifications in bulk – such as blanket modifications across a product group, our Shopping Bidder tool allows a PPC pro to do that in minutes.
PPC pros, however, often want/need to make decisions at a much more granular level. Shopping Attribute Bidder taps data from Google Ads and specific attributes in your merchant feed. This combination deepens the ability for PPC pros to make different bids to accommodate variations based on any number of attributes. You’ll want to read up on GrIP structures to get the most bang for your buck with Shopping Attribute Bidder.
Finally, Optmyzr Rule Engine is an extremely powerful tool in the hands of a PPC rockstar. With this proprietary tool, it’s really quite easy to adjust bids based on deep data points, such as conversion, CPA, ROAS and others. Among the most versatile tools in the PPC toolbox, you can automate bidding structures across pre-set parameters. Big snowstorm about to hit the northeast? Bids can automatically adjust to push snow blowers or skis. July heatwave predicted in the midwest? Rule Engine can push window air conditioners in Milwaukee, Madison and Minneapolis. You can set those rules up well in advance to automate against countless eventualities.
Conclusion
Holiday shopping season always puts eCommerce topics to top-of-mind, so it’s always a great opportunity to talk about Shopping Ads and powerful bidding tools. Of course, we all want to capitalize on the November-December gift buying frenzy, but these tools are 12-month necessities to allow PPC pros to beat the competition.
People are out there searching for your products/services right now. Make sure they find you before they find your competitor.
Of course, if you want a free 14-day trial or demo, just let us know.
Smart Bidding uses Google’s AI to optimize for conversions or conversion value in each and every auction. Target CPA, Target ROAS, Maximize conversions, and Maximize conversion value are all Smart Bidding strategies that include auction-time bidding.
They work with machine learning to continuously optimize your campaigns for the best results depending on the campaign goals you have set.
It’s worth noting that while Smart Bidding can be highly effective, it still requires careful monitoring and regular evaluation to ensure it aligns with your specific business goals and objectives.
How to make Smart Bidding work for you?
For starters, here are 4 ways.
1. Generate enough historical conversion data.
You need to generate enough historical data to make better decisions and optimize your campaigns. If you do not have enough conversions then the smart bidding algorithm will not work as expected.
2. Put a sufficient budget.
If your budget is limited, the algorithm may have fewer opportunities to make adjustments and find the most effective bidding approach. This can potentially limit the performance improvements that Smart Bidding can deliver.
3. Monitor the performance of your campaigns continuously.
Focus on key metrics such as conversions, cost per conversion, conversion value, and ROAS, and make adjustments to bidding strategies or campaign settings as needed.
4. Use conversion tracking to make informed bidding decisions.
Accurate tracking is crucial for Smart Bidding. Along with that, you need to let Google know the right value of each conversion.
As you can see, there are some very important things to note to get the best out of your Smart bidding campaigns. But managing them day in and out is not so easy.
5 ways to manage Smart Bidding Campaigns
Let’s see how you can manage them in an easier way.
1. Running experiments
It’s better to test what’s working and what’s not with a few experiments initially. Here’s how you can: Express optimization to create an Experiment to test Maximize conversion value, Target CPA, or Target ROAS bidding strategy.
This tool checks Google’s recommendations and lets you create trial campaigns to test the effectiveness of your smart bidding strategies with targets.
Once you create the trial campaigns, you can monitor their performance on the Campaign Experiments tool and get recommendations to turn the experiment you’re running into a campaign, if it is showing promising results.
Once the campaign starts running with smart bidding, you need to give Google the right set of information to make decisions.
2. Building a campaign structure
1. Select the right bidding strategy based on your business goal.
Use Maximize Conversions and Target CPA if your goal is to increase sales or leads.
Use Maximize conversion value and Target ROAS if your goal is to increase profit.
2. Find keywords that can drive conversions.
Broad match keywords can help you attract more visitors to your website, and allow the Smart Bidding machine to discover new opportunities for conversions. However, make sure to monitor broad match keywords to check if Google is really showing your ads for the right queries.
Identify search queries that are driving traffic to your account.
Find search terms that are sending you traffic without having to go through the entire Search Terms Report using the Search Terms N-Grams tool. This way, you can also make sure you don’t miss out on long-tail search terms.
Identify high-performing search queries for your account based on the search query report or Keyword Planner and add them to your ad groups as keywords.
The Keyword Lasso tool automatically analyzes search terms and suggests high-performing search queries that should be added as keywords (but are not already present in your account) to your account.
You can reduce clicks that are driving high costs but no conversions in the following two ways.
Add search terms as negative keywords in account negative lists.
You can use Optmyzr’s Negative Keyword Finder (Search) to identify individual words that are part of the search queries but are not performing well. These can be turned into lists that can be linked to campaigns to make it easier to manage traffic.
If you are interested in managing negative keywords even more closely, you can use Optmyzr’s rule-based optimization that you can customize and automate to your preference. It even identifies non-converting search terms and adds them as negatives at the ad group level.
Once you structure your keywords, you then create relevant RSAs for your campaign.
Optmyzr can help you find the ad groups that have no active RSAs and help you create them easily. You will see a list of different ad groups across different accounts to add RSAs.
Managing bids(targets) and budgets is a crucial part of managing your smart bidding campaigns.
As discussed above, a limited budget can restrict your ads from showing to the right people and bear losses for you. Hence, it’s important to know if your monthly budget is good enough to make sure your ads are being shown enough.
With the Spend Projection tool, you can analyze spend data, historical seasonality, and recent performance to predict how much your account is likely to spend by the end of a certain time period. You can also monitor the daily spending and understand future projections about how your campaign should spend its budget in order to meet the simulation budget.
You can just analyze the projection and make changes as you see fit or, use the Optimize Budgets tool to reallocate the budget where it’s needed the most.
If you like a rule-based way to manage daily budgets for the campaigns based on their performance, you can use the Rule Engine to automate this flow.
Optimizing for budgets is just half the story. It is equally important to optimize for the campaign and/or ad group targets. Rule Engine can come in handy here too, where you can choose to modify campaign or ad group targets based on the performance. And, if you are working with portfolio bidding strategies, Rule Engine also helps you identify the ones that are limited by the max or min limit and change their limits.
Also, if you are interested in going one step further you can work with bid adjustments or seasonality experiments. For Maximize Conversions, device bid adjustments work as adjusting the targets themselves, for the rest of them you can choose to opt out from showing ads on a device by setting -100% bid adjustment.
To know more about what bid adjustments work with which bidding strategy, refer to thisarticle.
4. Managing targets and exclusions
Creating a proper campaign structure and managing bids and budgets helps you to make sure that when customers are looking for something you sell, your ads are shown. However, that doesn’t help you control where your ads are shown. Should they appear on YouTube channels? Should they be shown in New York City? Where should they not be shown?
Here are some targeting and exclusions that can help you get started:
1. Exclude the placements that are not converting for you at the ad group or even at the account level.
2. Target a certain set of placements that are working well for your ad groups so that the ads are shown at these sites or apps using Rule Engine.
Exclude the locations from campaigns that are not giving you good returns and are proving rather expensive using the Rule Engine.
3. Exclude universally poor-performing placements from your accounts to reduce wasted spend using the Smart Exclusions tool. Reach out to our support team if you’re interested in getting early access to this tool.
4. Keep your audiences in sync with your business data and Google’s audience repository using the Customer Match List Updates tool.
You would have noticed how bid adjustments have very limited options when it comes to smart bidding strategies. So it becomes rather difficult to define how a particular demographic segment should be recorded.
The answer to this problem is conversion value rules. Value Rules are set at the account level. The rules can be based on location (physical or location of interest), device, or audience.
Optmyzr helps you better express the value of your conversions as they relate to your business and easily adjust those values based on geographical location, device, or audience during auction time bidding in real-time. You can feed your offline business data through the Segment Scorer which in turn helps in the adjustment of value rules.
Setting up conversion value rules also helps in optimizing your account’s performance by teaching Google’s automation (like those that handle Smart Bidding to optimize Target ROAS and Maximize Conversion Value) more about your business.
Adaptability is the name of the game in PPC. Platforms bring new updates and market conditions fluctuate. You don’t want to be caught by surprise when things change fast. You can use our content library to navigate those changes. Here’s some reading to get you started:
So these are some tips to help you manage smart bidding campaigns easier. We’re sure at least some of these tools can come in handy for you.
Thousands of advertisers — from small agencies to big brands — around the world use these tools to manage over $4 billion in ad spend every year.
Sign up for our 14-day free trial today to give Optmyzr a try. You will also get the resources you need to get started and more. Our team will also be on hand to answer questions and provide any support we can.
Not all clicks are created equal — some are more likely to convert than others. In the days of manual CPC bidding this meant that PPC specialists had to adjust bids to account for these differences in expected conversion rates. They might have set geo bid adjustments to bid more in Germany and less in Switzerland or to bid higher on mobile devices than on desktops.
But then Smart Bidding (Google’s name for its most advanced version of automated bidding) came along and many bid adjustments stopped working the way advertisers expected. We covered how different bid adjustments interact with different bid strategies in a previous post.
Let’s see how Value Rules, the shiny new toy from Google Ads, works to restore bid adjustments for automated bids and, most importantly, how to use this new tool correctly for optimal results.
You can now adjust conversion values based on characteristics like location, device, and audience to help optimize your campaigns!
Value Rules let you set bid adjustments for Smart Bidding
Value Rules were announced at Google Marketing Live 2019 and finally came out of beta in late summer of 2021. Value Rules let advertisers create rules to adjust conversion values whereas bid adjustments simply adjust CPCs. So how then are Value Rules a replacement for bid adjustments you might ask.
Remember that smart bidding automatically sets the appropriate CPC bid every time a search is done for your ad. This real-time bid is based on the expected value the click may produce and the advertiser’s target return on ad spend (tROAS).
In a simple example, if Google expects the click has a 10% chance of leading to a $100 sale, then that click is worth $10 (0.10 * $100 = $10). Combine that with a tROAS of 200% (i.e. make $2 for every $1 spent on ads), then the CPC bid will be $5 (i.e. this $5 click is expected to create $10 of value).
For this auction:
Click’s value is estimated at $10
tROAS is 200%
Automatically set a bid of $5
If user clicks, advertiser pays up to $5 and is expected to get $10 of value, hence ROAS is 200%
With Value Rules, you could tell Google that the conversion value would be double. By doubling the conversion value in the example above, you will end up setting double the CPC.
For the same auction, now with a Value Rule:
Value Rules says conversion value is double
Click’s value is estimated at $20 instead of $10
tROAS is 200%
Automatically set a bid of $10 instead of $5
If user clicks, advertiser pays up to $10 and is expected to get $20 of value, hence ROAS is 200%
As you can see, a Value Rule that doubles the value reported for a conversion is effectively the same as creating a bid adjustment of 2x.
Don’t use Value Rules the same way as bid adjustments
Now here’s the important thing. While you could use Value Rules as a straight-up replacement for bid adjustments, you should NOT because you’d be doubling up on what Google’s automated bidding is already doing for you.
Remember bid adjustments are way to manipulate bids when you’re doing the bidding process manually so let’s review that manual process for a minute. First, how are CPC bids typically derived? Say you expect 10% of clicks to fill out your lead gen form, and each form fill is worth $100 to your business, then your CPC bid would be $10 (0.10 * $100).
Next, how are bid adjustments decided? You’d look at your conversion numbers in Google Ads and notice that customers in Germany convert at a 20% higher rate, 12% instead of 10% of the time. So you set a +20% bid adjustment for clicks from Germany. Hence your $10 bid becomes a $12 bid when the user is in Germany (0.10 * 120% * $100 = $12).
Now here’s the rub… With smart bidding, Google already knows this difference in expected conversion rate so it will already set a $12 bid. This is true because the data you used to decide a 20% bid adjustment is the exact same data Google already gets from you when you use conversion tracking.
The bottom line is that creating a Value Rule to adjust bids based on expected conversion rates will simply stack bid adjustments and get you to bid incorrectly. So please don’t.
Remember, Google removed Broad Match Modified keywords because 95% of advertisers were using it wrong and getting results that weren’t intended. Let’s not go down that same path.
How to use Value Rules to optimize PPC campaigns
Value Rules are tremendously useful as a form of bid adjustments for smart bidding if you use the right data to create your rules.
A good rule will be based on something you haven’t told Google.
It turns out that there’s a lot advertisers know about their business that they’re not communicating to Google through the conversion tracking pixel, seasonality adjustments or different targets.
Let’s go back to our example with German customers. While we already told Google they convert 20% better than typical, what happens after the conversion? Do they typically have a higher lifetime value? Or do these conversions result in more store visits because you have more stores per capita in Germany than in other places?
We started with ‘not all clicks are created equal’, now we have ‘not all conversions are created equal’. Value Rules give us a way to communicate these differences in conversion quality.
How to use Value Rules
Value Rules are set at the account level. The rules can be based on location (physical or location of interest), device, or audience.
For audience, advertisers can choose between who the user is, what they’re interested in, what they’re actively searching or planning, and how they’ve interacted with your business.
Rules can be based on just one of the three types of segments, or combinations of up to two segments. Once advertisers pick the types for their first rule, all other rules must use the same two segment types. For example, if the first rule combines location and audience type, then all following rules must also use location and audience and it won’t be possible to create rules using device types.
There is a nice preview of rules, and the ‘If x, Then y’ methodology should already be very familiar to Optmyzr users of our very powerful PPC Rule Engine.
The action of a rule is to manipulate the reported conversion value by incrementing it by a set amount or multiplying it by a certain factor.
For example, if a user is located in the US and works in the tech industry, then add 5 to the value that was reported by the conversion pixel. Or, if a user is located in the Netherlands and regardless of audience, then multiply the reported value by 0.8.
The resulting rules will look something like this in Google.
Alternatives to Value Rules
As I’ve explained before, Value Rules are a less precise way to communicate conversion quality to Google than alternatives such as offline conversion tracking or value adjustments. But they are much simpler to use than the alternatives so they’re a great next step for advertisers who previously haven’t optimized their accounts by optimizing how they report conversions.
Value Rules in Optmyzr
Optmyzr will have an innovative new approach to creating Value Rules very soon, so drop our support team a line if you’d like to be one of the first to test it out.
Google Value Rules FAQ: How It Really Works
Updated August 26, 2021
Google’s Value Rules are a great feature for advertisers who want more control over automated bidding but who don’t want to set up the more complex offline conversions or value adjustment systems.
We got several questions related to this feature so here’s a roundup of the most popular ones. We’ll continue to amend this post as new information about Value Rules becomes available.
Do reports show different conversion values when using value rules?
Yes, the ‘conversion value’ column will show adjusted values throughout your entire account for search, shopping, and display campaigns.
This means that if you send reports to your boss or client with conversion values, these values will be ‘incorrect’ after enabling value rules. How you define ‘correct’ is up to you but there will be a change in how values are calculated and this could create issues with reporting.
We recommend having a conversation with your stakeholders before enabling value rules. Alternatively, you can use automated reporting tools like those offered by Optmyzr, to use value rules to improve bidding (using adjusted conversion values).
Are conversion values retroactively updated?
Values start being adjusted from the moment you create your value rules. Previously reported values will not be changed.
How can I see my original conversion values?
To see the unadjusted conversion values, in other words, the conversion value as if you had no value rules, enable the segment “Conversions → Value Rule Adjustment” on the account or campaign overview page.
After doing this, you’ll see a new segment for “original value (no rule applied) for any account or campaign that has a non-zero conversion value.
If a conversion satisfies multiple value rules, which one is used?
Amy Bishop explained this really well in her post about value rules. This is the order in which rules are applied:
For locations, the rule for the most granular location is used i.e. the rule for San Francisco takes precedence over the rule for California.
For audiences, Google will try rules in the following order:
Customer Match
Remarketing & Similar Audiences
Affinity & In-Market Audiences
Detailed Demographics
If there is a tie in an audience segment, Google will choose a rule using the “multiply” logic over the “add” rule.
If any other tie remains, they will choose the rule with the highest adjustment.
Is there really a 1:1 relationship between a bid adjustment and a value rule?
Nice article Fred, thanks. I'm wondering though, is the conversion modifier and bid modifier confirmed by Google to be a 1:1 relationship? I'm a bit doubtful about that. -->"By doubling the conversion value in the example above, you will end up setting double the CPC."
This is a great question from Mike Ryan who really knows the details of PPC. And he’s right that setting a value rule is not necessarily the exact equivalent of setting a bid adjustment.
Here’s why: Value rules change the value of a conversion that is reported to Google. Google’s machine learning algorithms then use these self-reported conversion values to predict the probable value of future conversions.
But remember Google considers over 500,000 signals from each auction to make this prediction.
And while the advertiser may have adjusted the value they reported because they really like conversions from California, the ML system may instead find other factors (like time of day) that correlate with these high conversion values. Rather than bid higher because the user is in California, it bids higher because the user is searching at night.
Value rules are set at the account level and change the values for all reported conversion values for search, shopping and display campaigns. The rules will change the values regardless of the bid management style of the campaign.
If a campaign is using tROAS, maximize conversion value or is a smart shopping campaign, then the adjusted conversion values will impact how Google determines bids. They will continue to consider only those conversion actions included in conversions (this is a setting for each conversion action).
What is the range of allowed adjustments?
A rule can change the original value of a conversion by a factor ranging from 0.5x to 10x. Alternatively, advertisers can choose to add a static value to a conversion that meets the conditions of the rule.
It seems a bit counter-intuitive, but there really are things every advertiser knows that Google doesn’t – like how people act after they’ve converted from one of your Smart search or shopping campaigns. These are things like:
Customers who made a purchase but returned all or part of their order
People who submitted a form and took 12 actions outside of Google’s sight before converting
Loyal buyers who split repeat purchases between digital and in-store
There’s no question that Smart Bidding and offline conversions have completely changed advertising, but are you one of the few who feed information back to Google to get the most out of those systems?
Ad platforms like Google are automating rapidly, but they need all the information you can provide to speed up machine learning and make better decisions on your behalf. If you want to your ads in front of people who will give you profits instead of just sales, you have to rethink the way you perceive PPC optimization.
We sat down with two people at Google who understand this process best:
Emi Wayner, Platform Partner Lead, Channel Sales
Alex Ioch, Regional Product Lead, Automation
Alex is part of the team that builds the products at Google that enable this new wave of search advertising, and Emi helps businesses adapt to the new realities.
We talked about how to use offline conversions to get better leads, why non-retail models need to import post-conversion data, and how to run Smart Bidding to its full potential.
Customer data is the key to sustainable growth.
A study by Boston Consulting Group indicates that online advertisers see average gains of 20% incremental revenue and 30% cost efficiency when they integrate strategies with customer data across the purchasing journey.
Whether you choose to import or track offline conversions, there aren’t many arguments against the importance of first-party data when optimizing modern PPC campaigns.
Just remember that phased growth is the only way you can achieve results with any of these recommendations.
Automations like Smart Bidding require a considerable volume of manual conversions before they can begin making the right decisions for you. Lay the groundwork with manual optimizations, and allow at least two weeks for learning. That goes for search as well as shopping.
In other words, don’t expect huge gains from your campaign metrics within days of feeding in customer or post-conversion data.
Don’t measure everything. Here’s what to focus on.
While Google Ads can measure online activity, sometimes a user who clicks on your ad and enters your sales system converts offline where Google can’t see it, like your CRM or in person.
So there are two groups of components you want to keep track of.
Online: leads & sales
When you track only leads, you get a fair idea of the initial demand for your product or service. Extending tracking to the final sale gives you a better picture of your overall purchase journey:
How much interest does your brand generate online?
How long can you sustain that interest?
How well can you persuade people to give your business money?
Sometimes, even the final sale happens offline. And in these cases, it’s critical to feed that information back into Google Ads with offline conversion imports.
But even if you were to track both leads and sales online, you’d still only see a part of the picture. If a university gets 2,000 requests for information that ends up with 20 enrollments, all they know is they have a 1% conversion rate.
But what about all the other stuff that happens in between? How much did that contribute, if at all?
Offline: The middle funnel
There’s usually a big disconnect between what advertisers tell Google to track and what actually matters to their business. An online form submission is easy to fire a pixel on; you can’t do that for things that happen offline or on a channel that isn’t trackable.
But when you do measure what happens between lead and sale, you get a better idea of what actions are most profitable for your business. Let’s take the same university example Google showed on PPC Town Hall:
2,000 requests for info yield 200 applications started (10% conversion rate)
200 applications started end with 80 applications completed (40%)
80 applications completed lead to 20 students enrolled (25%)
All of a sudden, you can see more of what impacts the final conversion. When you feed that information back to Google is when the magic really happens.
It’s okay to estimate expected value.
When you import offline conversions into Google Ads, it helps to be able to assign values to them based on what level of value they contributed to your business.
The best way to do that is to work backwards:
You know that a student who enrolls contributes an average of $10,000 to your university
You account for some fluctuation and tell Google that a completed application is worth $2,000 (25%)
A started application is then worth $800 (40%)
And a request for info is worth $80 (10%)
These numbers make it easier for Google’s algorithms to piece together the signals that make a user worth $80/$800/$2,000/$10,000 to your university.
Important: “Don’t get hung up on the numbers,” Alex says. Conversion values are a tool to help Google score and prioritize different users, and these numbers do not directly impact your ad spend or ROAS.
Smart Bidding works best when it has offline data.
When you use Smart Bidding without offline data, Google will look at tens of millions of signals that are familiar to most online advertisers:
Demographics
Conversion rate
Audience segment
Browser
Language
Keywords
Bids
Time
Location
And much more
But when you import offline data, you can feed so much more information to Google that it uses to optimize future targeting. In the case of a university, this might include parameters like:
SAT scores
Preferred courses
Income
Credit history and score
Referrals and awards
Existing credits
All of a sudden, the jigsaw Google puts together of your ideal customer gets a bunch of new pieces added to it. They can tell with greater accuracy which bids to which clusters of users will give you the best long-term returns.
Value-Based Bidding strategies let you optimize Smart campaigns.
For education, that could look like assigning different values to students who request a brochure and ones who sign up for a free online course. In retail, it might mean segmenting customers who make frequent returns from those who end up keeping their purchases.
A value-based bidding strategy tells the Smart Bidding algorithms that one group of users/customers is worth more to the profitability of your business than another.
And so Smart Bidding then knows to optimize for the group that is worth 2x/3x/10x more to your bottom line, giving you greater value from your ad spend that goes beyond just ROAS.
Additionally, fixed-value bidding skews your spend and limits your returns. User segments with a higher average bid than your fixed value become missed opportunities, while you over-invest in segments with lower average bids.
Monitor. Intervene. Educate.
There’s no shortcut or a way around the work. Finding sweet spots for ROAS and CPA targets take time, so don’t resist or be intimidated by the learning process. Test your ideas, monitor the outcomes, and optimize as you hit subsequent rounds of statistical significance.
At no point should you keep Google’s machine learning algorithms in the dark, even if data visibility is something all advertisers would like more of from the platform. It only impacts your business negatively; Google’s automation will grow with or without your accounts.
Once you know what works, automate the solution and keep control over how and when you feed information back to Google. A third-party tool can make monitoring and intervention easier and limit damage from malfunctions in the ad platforms.
Optmyzr offers a 2-week free trial that’s helped teams like Sean’s preserve their time and mental fortitude for what matters, allowing them to double their managed ad spend.
Bid automation is one of the biggest potential time-savers in PPC. Machines are simply faster and more reliable than humans at constantly updating bids based on hundreds of factors influencing conversion rate and conversion value per click.
But what if you’re not seeing the results you were hoping for? It could be that the bid automation isn’t the problem but that you didn’t give it all the information needed to make smart decisions.
For example, when you reported a conversion and told Google that the customer spent $100 in your online store, could you have shared better data like how much was returned and how much profit you made from the items the customer kept?
The point is, you can never go hands-off with any kind of automation. Instead, what you should do is limit the time you are involved.
Optimizing in this way by manipulating conversion values is a newer territory for many advertisers. The value data already flows through conversion tracking, and using that as an optimization lever has traditionally not been top of mind for many advertisers.
Optimizing conversion value should be a priority in a more automated PPC world, and there are 3 options Google offers advertisers. In addition to working with your own web development team, these are, of course, to send the value you want to Google through the conversion pixel in real-time.
So let’s take a look at the 3 options to share better data with Google’s machine learning systems about the value your PPC ads are delivering
Option 1: Offline Conversion Import (OCI)
Offline conversion tracking (or Offline Conversion Tracking) is the original way to tweak conversion data after something has already happened on your site.
It was primarily built for lead gen advertisers. But it’s surprisingly useful for eCommerce advertisers too. The idea is to capture a click identifier (called the GCLID or Google Click ID) and hold on to that in your own system until you’re ready to report that something desirable happened from that click.
At that time, you can send Google the GCLID, the conversion, and a value, and they are then able to connect that with all the attributes of the click.
That means the Google machine learning system can then start to figure out if any patterns correlate with users who tend to take the desired actions.
So, for example, if they notice many people from Germany convert and return high values for lower click costs (hence delivering high ROAS), then the automations may decide to try to get more clicks from Germany.
With OCI, you can’t restate values, but advertisers can create new conversion types and add them to ‘conversions’ where Google’s smart bidding algorithms will use them.
In lead gen, that could mean creating offline conversions for ‘qualified prospects’ after a salesperson speaks with the prospect on the phone and a ‘closed deal’ when that prospect eventually purchases from their sales rep.
Retailers can also benefit from this capability by nudging Google’s systems towards what they believe to be better customers.
For example, creating a secondary conversion based on a scoring model predicts a customer’s future purchase behavior with the retailer.
OCI is particularly useful in this case because it may not be possible to calculate that lifetime value component in real-time while the user goes through the checkout process. When it is calculated, later on, it can then still be communicated to Google.
Option 2: Conversion Value Adjustments
This second option of adjusting conversions is generally less known but it’s actually an easier to implement variation of OCI.
Rather than capturing and storing the GCLID, advertisers can add a transaction ID to their existing conversion tracking code from Google at the time of the initial conversion. Then they have 55 days to restate the value of that conversion.
Here’s an example of how that could work. The advertiser sells $100 worth of goods, but $40 of goods are returned by the consumer before the return window closes. The initially reported value of $100 can now be restated by telling Google the original transaction ID of that sale and the new value, in this case, $60 ($100 - $40 which was returned).
By doing this, Google’s automations may come to realize that people in Germany return more stuff than those in the UK and appropriately tweak its decision-making process to account for that factor.
While this system was designed to help retailers, lead gen companies can also benefit from it.
For example, they could retract a lead from someone who filled out a form but then never took advantage of the free trial offered by the sales team.
Option 3: Conversion Value Rules (beta)
The last option to teach the machine about value is to deploy conversion value rules which are currently in beta testing from Google.
This is a less precise methodology because it doesn’t allow advertisers to tweak individual conversions. It does however allow advertisers to tweak conversion values based on some high-level attributes that they may have already correlated with desirable behaviors.
As in the previous example of buyers in Germany and the UK, they could boost their reported conversion values for users from the UK because they do fewer returns. Other attributes around which these rules can be built are device types and audiences.
Conclusion
Smart bidding can seem like a better alternative to letting Google do the heavy lifting for you. It’s perfect for automating the more tedious parts of PPC management so that you can spend time on strategy.
Note: Smart Shopping campaigns have been upgraded to Performance Max in September 2022. We suggest you refer to these links below to know more about Performance Max.
If you’ve ever used the Smart Shopping feature in Google Ads, you know how easy and quick it makes e-commerce. Smart Shopping campaigns are easy to set up; all it needs is for your merchant feed to be up and running.
But there’s always a catch. In this case, it’s little to no visibility into traffic and which products are driving business to your campaigns. In other words, it’s a black box solution.
As Tinuiti states in this blog post (super useful if you’re not totally sold on Smart Shopping and want to figure out when to use it):
“Smart Shopping campaigns provide no search term data and no audience data, while it also only indirectly provides placement data (for display ads), individual product performance. The lack of data means that advertisers have no ability to set ROAS or CPA goals based on search intent, type of user, type of ad, or type of product, and cannot control where their advertising spend is allocated to.”
But if you’ve done your research and believe that Smart Shopping is the ticket, try these 6 optimizations to gain more control over your shopping campaigns.
1. Segment products by ROAS performance
Smart Shopping lets you set a target ROAS at the campaign level. Unless most of the products in your feed have a similar ROAS or price, it’s a good idea to segment them into different campaigns.
You can create campaigns for your products by brand, product category, or custom labels. Or in this case, by their ROAS performance—so that products with similar performance have the same target ROAS.
This helps get better results for your entire inventory instead of averaging performance across all products. Multiple campaigns also let you allocate more granular budgets. For example, you might give a bigger budget to a campaign with products that have over 150-200% ROAS.
Optmyzr Tip: If you’re not sure how to structure multiple campaigns by ROAS or another attribute, use our Shopping Analysis tool to break your current Smart Shopping campaigns down by any attribute.
2. Build groups of individual products (GRIP)
While you can’t create multiple ad groups in Smart Shopping campaigns, you can create multiple product groups using the GRIP structure. This puts one product per product group, letting you ultimately exclude products that aren’t profitable for online retail.
One cool thing Optmyzr lets you do is apply the GRIP structure to your current roster of products. From there, advertise the less profitable products in a standard shopping campaign where you have greater control over bids, budgets, and negative keywords.
3. Spend wisely
Another benefit of having multiple shopping campaigns is that you can put bigger chunks of your ad spend into better-performing entities. So if your high-ROAS campaign is doing well but is losing impression share due to budget, fire it up.
You might also consider increasing or decreasing budgets based on the seasonality of your business experiences. If you’re running a sale over the weekend or during the holiday season, increase your budgets to get more traffic, and then scale them back after the sale is over.
Optmyzr Tip: The Optimize Budget tool lets you manage and improve Google Ads budgets easily. It translates your budgets from monthly to daily levels, which can help you hit a target or put more money behind campaigns that are driving the best conversions.
4. Adjust seasonal bids
Use the seasonality adjustment in your Smart Shopping campaigns to adjust for any upcoming short-duration events, like Black Friday weekend or the Christmas-New Year’s bridge.
Apply a predicted conversion rate adjustment based on your past experience during a similar period, and Google will consider it for that particular period. Google will also exclude data during the adjusted period so that unusual conversion rate patterns don’t affect future bids after the seasonality event ends.
This is especially important because Smart Shopping relies so heavily on these signals. Any fluctuations that aren’t identified as such can adversely affect your future campaigns and how much you’ll pay.
5. Don’t overlap products
When it comes to avoiding overlap, we recommend focusing on the category level first. So if you sell sporting goods, put all sneakers/trainers in one type of campaign, all compression wear in another, and so on.
If you split your sneaker SKUs partly into a Smart Shopping campaign and partly into a standard shopping campaign, then Google may heavily skew impressions towards the subset of sneakers in the first.
To understand this better, think of any search that is not for a specific product e.g. “white men’s sneakers”. With any degree of non-specificity, Google will simply find a close-enough match from the Smart Shopping campaign and ignore a potentially more relevant close-match from a standard campaign.
And last, but not least…
6. Understand your Smart Shopping goals
In other words, know what your campaign needs to be optimized for before you structure it. We recommend these tips to better manage your campaigns according to different end-goals:
• Maximize revenue or profit: Combine max products into a single campaign to drive sales and maximize conversion value.
• New product launches: Hero products or new products in a Smart Shopping campaign with low ROAS, with enough budget to get traffic, visibility, and impression share.
• Creating different campaigns: For products with different sales and margin targets, create separate campaigns for each grouping to make sure that part of your investment goes to these categories.
Remember, the Shopping Analysis tool in Optmyzr lets you find which products are returning a higher ROAS so you can group them into a new campaign.
And while we’re on the subject, here’s our answer to one of the most common questions we hear from advertisers.
Can we create Smart Shopping campaigns alongside standard ones?
Of course you can, but remember that Google will prioritize Smart Shopping campaigns. If you run them simultaneously, you might see a change in performance skewing away from your standard campaigns.
One way to use them together is to look at the performance of products in our Shopping Analysis tool, exclude low-performing products from Smart Shopping, and instead run them in a standard shopping campaign. This is a good way to give your lower-performing products a fair chance to perform.
So while Smart Shopping is a boon for advertisers who are low on resources or knowledge, remember one thing:
Machine Learning + Automation ≠ Better Results
But it does mean less time managing your campaigns. And while the debate over control vs. automation goes on, there’s still ways to use Smart Shopping while making it more effective and profitable.
If you don’t have access to our tools, consider signing up for our 2-week free trial. You’ll get access to all our tools, and our team would be happy to show you how to best use Optmyzr to achieve your goals.
For any other questions and product support (or to see a demo first), write to our team at support@optmyzr.com.
Over the past few years, marketers have seen Smart Bidding evolve with Google’s machine learning. In fact, it seems to be a way into the future of advertising by making the best use of AI and data to provide intelligent campaign adjustments. But while Smart Bidding does automate tedious tasks of PPC ad management and save time, it’s far from a ‘set it & forget it’ mentality. To make the most of it, advertisers need to monitor and optimize to get the best results for their campaigns.
So this week on Episode 28 of PPC Town Hall, we invited our friends from Google to discuss Smart Bidding campaigns and shed light on tactics for optimization.
Our panelists for the week:
Emi Wayner, Platform Partner Lead, Google
Peter Oliveira, Partner Development Analyst, Google
You can receive the exclusive Smart Bidding guide from Optmyzr and Google by signing up here! You can also view previous editions of PPC Town Hall right here.
Without further delay, here are the 6 insights to understanding and optimizing Smart Bidding campaigns.
1. Evolution of Modern Search
Emi: What we see today is really the evolution of machine learning. I think machine learning is getting smarter with people getting more comfortable using and leveraging it to the next level for better results. We search so differently compared to what we did three years ago. In fact, 15% of queries on google.com are new every day. That means there are tonnes of queries that Google misses as well. So, we really have to depend on Machine learning to capture maximum potential with search.
As machine learning gets smarter, the data that marketers provide is really going to be the key to be competitive and achieve your goals. Not from the CPA perspective, but broader profitability and customer lifetime value.
2. Analyzing Smart Bidding signals
Peter: Google looks at billions of signals to set the bid for every auction. We’re monitoring a bunch of different things more than just the signals, like the intersection of these signals. A lot of the things that we used to optimize manually like devices, day of week, time, location, all the different keywords, etc are now being taken care of for Smart Bidding. But there are some tactics which you can use to inform Smart Bidding what are the right ways you can treat some of these things.
Emi: So this is a recent performance review using selected US accounts. When we looked at the data, Smart Bidding outperformed Manual Bidding across most of the spend buckets on Optmyzr accounts.
A lot of people should take advantage of Smart Bidding regardless of the budgets (look at the right-hand side of the chart – ‘under 500 budget’). And we see significant performance even in smaller budgets as well as larger ones (above 50k).
3. Optimizing Discovery campaigns
Peter: I have seen some very strong results with Discovery campaigns for certain advertisers. For example, I worked with a real-estate partner who was seeing better results in Discovery campaigns than in Search!
If you’re having issues with the returns and getting conversions, make sure that you’re setting the CPAs properly. Setting up unrealistic CPAs that do not represent your goals can hamper your account health. And then there’s also the flipside. If you look at our audiences to whom we are comfortable suggesting Discovery Ads, you’ll see that the daily budget recommended is about 20 times the target CPA. So, if you have a tighter budget, I’d recommend maybe doing 10 times the target CPA.
That being said, I have seen success at a lower CPA. But if you have a smaller budget, I wouldn’t be actively recommending Discovery Ads to you. Layering on audience lists like remarketing and customer matching might help you see more successful results.
Emi: We have seen a pretty good performance in the use cases with Discovery campaigns, even for a first-time mid-sized account. So I would encourage marketers to keep looking into why they aren’t giving you a good performance. In terms of how long, usually we test for a week and then we regroup with the customers, and keep doing this. So one week at a time.
4. Common mistakes advertisers make with Smart Bidding
Start making sure what goals your Smart Bidding campaign will be optimizing and those goals align with what you’re trying to achieve. I have seen people set a Max Conversions strategy on a campaign that was spending half of its budget. We didn’t see any positive results CPA-wise as Max Conversions doesn’t necessarily focus on optimizing your CPA. It looks towards getting you as many conversions as possible within your budget. And if you’re spending only half of your budget, we don’t necessarily know whether that incremental conversion will come at a CPA that aligns with your historical ones.
The other thing is the target that we set. I would advise looking into your optimization score recommendations in the front-end to see what we are recommending there. You’ll probably want to start by setting a target in line with what you’re historically performing at. If you’re historically performing at a CPA of $100 and if you switch that down to $50, you can massively end up throttling the number of conversions and sales you were getting.
Just because we don’t want to necessarily start with Smart Bidding on the exact Target CPA, doesn’t mean we can’t get there. Start with where you’re historically performing at and slowly adjust to get where you want to be.
5. Structuring a Smart Bidding campaign with segmentation
Peter: When we segment our campaigns, Smart Bidding can actually take data and learn from the performance that’s happening throughout the account. While you don’t need to segment everything, if you do end up breaking up your campaigns, Smart Bidding will be able to learn from the performance of the campaigns. The only thing that I’ll caution about is to break down to the point where there isn’t a lot of conversion volume in each individual campaign. On top of that, if you have a Target ROAS or Target CPA that your campaigns aren’t able to meet, that’s something to watch out for.
If you put more constraints on the targets and segment the campaigns, you could end up throttling your campaigns altogether.
6. Marketing as a holistic approach
Emi: We think that a marketer can play a bigger role in PPC marketing than just making strategies or directing CPC. We look at a marketer as a growth engine for the company. Strategic points like profitability and value of customers can help bring value to your work and your business. I would really encourage everyone to think more than just PPC, think of how you can bring that value to your company and leverage for more growth.
Conclusion
Fred: When you start with something, like Smart Bidding, it’s better not to shock the system and be extremely aspirational. Machine learning functions on how things have worked consistently in the past. Even if you set up higher targets, it might take a while for the system to get you there. But at the end of the day, to achieve the target you really want, it all comes down to you, the advertiser, to set up the prerequisites and feed in impressionable data. You can add a lot of value to your ongoing campaigns by not taking bidding as something that just happens by itself.
Seasoned PPC professionals make use of efficient bid management tools, like Optmyzr, to keep their accounts top-notch and optimize your bids. Try and experience our capabilities yourself by signing up for our 14-day free trial.
Some marketers fear automation, but Smart Bidding is a great example of how it actually helps.
Teeming with data and interactions, Smart Bidding uses machine learning to create optimal bid strategies. And because it saves both time and money, it’s quickly become an important part of PPC.
But there’s a (literally) dark side to it as well.
Smart Bidding means surrendering control to the black box of Google’s AI, with strategies that simply don’t allow you to tweak aspects of them to your specifications. Simply put, you input your goals and Google uses your account’s past behavior to produce results.
What do you do when you want the convenience of Smart Bidding but don’t want to give up control? You turn to a tool like Optmyzr.
Here are 10 ways Optmyzr customers use our platform to retain control when they use Smart Bidding.
Understanding how automated bidding works
The keystone of AI or machine learning is the data the system uses to make decisions and predictions. In the same vein, the success of automated bidding strategies depends on the quality of the performance data that system is able to collect. This in turn depends on how your account is set up.
The performance of badly structured campaigns cannot be improved by putting them on an automated bidding strategy.
A good account structure and the right attribution model are vital to the success of any automated bidding strategy. If you’re using last click attribution, either change to another attribution model or run manual bidding.
Campaigns that run on automated bidding strategies need to be optimized in order to have the right data to work with. In theory, the only thing Google takes care of is setting bids — only one aspect of managing an account.
The rest is still on you.
Automated bidding is not a ‘set it and forget it’ deal. However, with bidding out of the picture, you’ll have more time for other tasks — the kind of search queries you want to show for, or the messaging you want to use in your ads.
1. Search Query Management
Search queries are still the primary source of traffic for search campaigns, so it’s important to monitor the ones your ads show for so you can remove irrelevant ones (add them as negative keywords). It’s also a good idea to add high-performing search queries as keywords because you can write more specific ads for them.
Optimizing to increase Quality Score is one way to reduce your CPA and increase ROAS. Even though Google is automatically setting your bids in the auction, a high Quality Score requires a lower bid.
In other words, you pay less for each click.
Find keywords in your account with low Quality Score and move them to their own SKAGs with the more specific ads. Or, pause them if they have an irredeemable quality score of 1.
This isn’t about setting bid adjustments for different times of the week; your automated bidding strategy already does that. We’re talking about allocating campaign budgets to the more lucrative times of day by turning your ads off when they’re not profitable, making it something of a budget optimization.
Optmyzr Tools Used: Hour of Week Analysis, Hour of Week Bid Adjustments
4. Non-Converting Keywords
Pause keywords that have not converted in a long time but have accrued significant cost. This optimization should only be done if you aren’t running on last click attribution. Otherwise, you’ll pause top-of-funnel keywords and eventually reduce conversions.
You did budget optimizations before automated bidding, and you should continue to do them now. Reallocating budgets across campaigns based on performance helps improve overall account ROAS.
Check if high-performing campaigns are losing impression share due to budget, and increase their budget by giving them money from underperforming campaigns.
If you’re running on the standard automated bidding strategy (target CPA and target ROAS), you can tweak targets at the ad group level. There are two instances where I’d recommend doing this:
1. A sudden change in business or an upcoming event like a sale requires you to tweak targets. It’s a way of telling the system that you want more or less traffic when there’s a sudden change in patterns the system is unaware of. For example, if your business has a sale over the weekend and you want to drive more traffic to your campaigns, increase CPA targets over the weekend and then scale them back down once the sale is over.
2. Day-to day optimizations to increase conversions. Some common optimizations you can do are:
• Increase target CPA for ad groups that are converting but losing impression share due to ad rank. For campaigns running on target ROAS, reduce ROAS. This is the same as increasing bids for high-converting keywords when campaigns are on manual bidding. It enables Google to bid more to drive more conversions.
• Reduce target CPA or increase ROAS for ad groups whose actual CPA and ROAS are significantly better than the target and whose impression share is already more than 70%. This reduces the chances of Google buying very expensive traffic when the automated bidding system thinks there’s room to increase CPA and win more traffic.
7. A/B Testing Ads & Updating Messaging
Ad text automation is probably one of the last things that will happen in PPC — writing ads always involves subjectivity and creativity. Responsive Search Ads are a step in that direction, but they only combine headlines and description lines; you still have to write them.
This is why it’s important to continually A/B test ads — so you can remove underperforming ones and keep messaging fresh.
Optmyzr Tools Used: A/B Testing, Ad Text Optimization
8. Performance Monitoring & Alerts
Perhaps one of the most important things you can do is set up alerts to notify you of sudden changes in traffic, conversions, CPA, ROAS, or any other KPI that’s important to you.
This helps you stay on top of your campaigns, especially when something doesn’t go as expected. For example, if the CPA for a campaign suddenly shoots up, you’ll want to see why it happened and take appropriate action.
Optmyzr Tools Used: Alerts on the MCC dashboard, Rule Engine
9. Performance Audits of Automated Bid Strategies
Knowing when to pivot is critical to success, be it in PPC or any other business. It’s a good idea to regularly check on the performance of your campaigns’ bidding strategies to see if you need to pivot.
For example, if a campaign is running to maximize conversions, it might be time to move it to target CPA and ROAS. You can also see if certain campaigns on automated bidding strategies aren’t driving enough conversions and move them to manual bidding for a while.
Optmyzr Tools Used: PPC Audits, Rule Engine
10. Structural Account Audits
Regular account audits are so important for good structure. Check for things like too many keywords in an ad group, too few ads, campaigns with not enough negative keywords, or campaigns missing site links.
This ensures that campaigns in your account have a solid foundation on which automated bidding strategies can do what they’re capable of.
Optmyzr Tools Used: PPC Audits
Conclusion
We live in a world where competition is fierce and standards are demanding. PPC marketers rely on automated bidding more than ever to do more in less time. What automated bidding lacks intuition and human understanding, you can provide by optimizing your campaigns.
Help it help you.
There’s no one way to win with automated bidding, but Optmyzr offers several tools that allow you to layer your own automation over what the ad engines provide. If you don’t have Optmyzr, try our platform free for 14 days with access to all features.
The last time we sat down with Google to talk shop, the discussion found its way to managing PPC campaigns during the COVID-19 pandemic.
With supply chains disrupted and business models being tested, companies around the world are facing a variety of new conditions. And though the results aren’t uniform, what’s consistent is how every business has been affected in some way.
Many are struggling to find customers. Some are facing uncertain futures. A few fortunate ones are doing better than ever — will they struggle when things return to normal?
We put together some advice for PPC marketers that took the shape of this blog post. But in the weeks since, we’ve seen and heard the debate over automated bidding become one of the prevailing industry conversations.
Thankfully, our friends at Google had plenty more to say.
Here are their recommendations for 6 secret tips that can help you impact Smart Bidding and more reliably navigate a marketplace in flux.
6 Secret Tips to Impact Smart Bidding
As you monitor shifting trends and course-correct your business plan, you’ll also need to bring your strategic approach in line with what the current situation demands. To help you provide clients and customers with a fruitful experience without eating too much of your time, Google recommends Smart Bidding.
Let’s recap the tactics we recommended last time, as well as explore how they impact Smart Bidding.
1. Keywords
Recommended Tactics
Use negative keywords as a safeguard against undesired clicks that might drive lots of cost but no conversions.
The way users are searching for your business may have changed, which is why it’s important to capture those shifts in search behavior through broad match keywords.
When bidding on keywords with your brand name, adjust goals for Impression Share or use tCPA/tROAS.
How does this impact Smart Bidding?
Keyword optimization helps deliver more at the same CPA/ROAS goal, and ensures that brand strategies align with business goals. Broad match keywords allow the Smart Bidding machine to discover new opportunities for conversions.
Optmyzr Tip: You’ll still want to keep other match types and regularly review new search terms with tools like Optmyzr. The Rule Engine’s latest addition takes high-performing keywords with one match type and lets you add new match types at the ad group level.
2. Creatives
Recommended Tactics
Use Dynamic Search Ads to show up on new relevant searches your keywords may be missing out on.
Use Responsive Search Ads to adapt ad content to more closely match user search terms.
Make offers stand out and take customers to the right page with promo and site extensions.
How does this impact Smart Bidding?
Getting your creatives right prevents your message and customer experience are on the same page, which ensures that each bid brings relevant engagement.
Optmyzr Tip: Regulations and restrictions can change frequently. With the Ad Text Optimization tool, you can quickly and consistently change ad copy to reflect the real-world operating conditions of your business. The Add Responsive Search Ad tool is also useful to build RSAs for each of your ad groups.
The Responsive Search Ads tool lets you maximize your chances of getting meaningful clicks
3. Bids and Budgets
Recommended Tactics
Move unused parts of your budget to the ads that need it most.
Raise the budgets of campaigns that are performing well to drive more traffic.
Use Performance Planner to understand the implications of different budget scenarios.
How does this impact Smart Bidding?
Putting your marketing dollars where they’re likely to yield the best returns is PPC 101. You capture more leads at the same CPA/ROAS goal, and forecasting often captures the most recent demand trends.
Optmyzr Tip: Campaigns that worked a few months ago might not be winners today, for no fault of their own or yours. Put your dollars where they need to be with the Optimize Budgets tool. It can help you quickly re-allocate budgets based on how different campaigns are doing against your goals.
Optimize Budgets lets you see how to adjust spend to achieve specific goals
4. Target Constraints/Goals
Recommended Tactics
Evaluate your new business strategies and confirm target goals.
Set performance targets and customize settings to your unique business goals.
How does this impact Smart Bidding?
Using CPA/ROAS goal adjustments can help you control spend and volume. But to achieve the same thing for Max strategies, Google recommends using budget adjustments.
Optmyzr Tip: Use the Optimize Target CPA & ROAS on campaigns with automated bidding to increase conversions and Impression Share. You can also see converting ad groups that use other automated bidding strategies.
5. Account-Wide Best Practices
Recommended Tactics
Capture all signals using Data-Driven or Non-Last Click Attribution.
Only include conversions that are relevant to the business.
How does this impact Smart Bidding?
Smart Bidding uses account-wide signals (cross-account under MCC, if applicable). If you’re struggling to see results from Smart Bidding, it might be because you’re still using Last Click Attribution in an era of erratic search behavior.
Optmyzr Tip: The Rule Engine allows you to create data-based strategies, like removing non-converting keywords related to COVID-19. Or for a fun way to keep your account in shape, try the Workouts that combine multiple optimizations to achieve a specific objective.
6. Audiences
Recommended Tactics
Add all RSLA, Similar Audiences, and Customer Match lists to Smart Bidding campaigns.
How does this impact Smart Bidding?
First-party audience lists improve Smart Bidding algorithms, but Google lists have a neutral impact on Smart Bidding. For best results, provide your own customer information.
Optmyzr Tip: You always want Smart Bidding to have the latest and greatest information about your customers. Use the Customer Match List Updates tool (under Optimizations > Utilities) to keep your audiences in sync between your business data and Google’s audience repository.
6 Ways to Fully Control & Adjust Smart Bidding
While Smart Bidding might make PPC a bit less time-consuming, it’s far from a ‘set it and forget it’ mentality. There are many things you can do to affect the degree of control and influence you have over your bids.
Check out these 6 ways to fully control and adjust Smart Bidding.
1. Goals
Goals are the end objectives of your campaign; think of them as a destination. Tweaking goal values can change the way Smart Bidding tries to get there.
CPA/ROAS goal adjustments
Ad Group targets
Portfolio targets
Device CPA modifier
Operationalize forecasts
2. Conversions
Current market realities have impacted conversions across the board. Use the information in this space to inform your strategy and reshape the Smart Bidding process.
Conversion value adjustments
Campaign-level conversion setting
“Hack” data exclusion (seasonal adjustment)
New secondary KPIs
3. Constraints
Setting hard limits on your financials can enable Smart Bidding to look at creating value over volume. As always, keep an eye on things as you implement this approach.
Limiting budgets on purpose
Portfolio CPC max/min bid limits
4. Targeting
Audience is one of the most influential factors in PPC, and there’s no doubt that who and how you choose to target can make a difference to Smart Bidding results.
Pausing targeting
Opening targeting
Split testing
5. Budgets
At the end of the day, it’s all about the dollars. Experimenting with budgetary values can provide some of the most significant influence on Smart Bidding.
Shared budgets
Uncapped budgets
Constrained budgets
6. Misc. Adjustments
There are other adjustments you can make to shape Smart Bidding, including seasonal adjustments. We suggest exercising oversight when using some of these in today’s market.
Seasonal adjustments
Campaign structure
Split testing bid strategies
Conclusion
It’s been said before but bears repeating: There’s only one way PPC professionals can do right by their businesses and clients — by having as much information as possible. That’s why we’ve partnered with Google to bring you these posts on how to gain maximum value from the tools at your disposal.
These recommendations from Google are intended to supplement a brand’s unique business strategy. Both Google and Optmyzr suggest you balance any automated bidding strategy by keeping a close eye on your accounts. After all, only humans can provide context to the data.
And be on the lookout for the third part of our collaboration with Google, when we discuss what advertisers in hard-hit industries can do to prepare for the end of lockdown.
Machine Learning (ML), Artificial Intelligence (AI) and Automation are three trending topics in the industry today. It’s an accepted fact that automation is here to stay so it’s our job to learn how to make the most of it for our PPC accounts. In my book “Digital Marketing in an AI World”, I explain that one of the roles humans will have to play when their old job has been automated is that of the “PPC Doctor”: someone who knows the right medicine for their patient and who also understands potentially dangerous interactions. This post covers one such interaction that can lead to disastrous results in PPC.
We’re talking here about Google Ads’ smart bidding strategies. Even though they’re designed to help advertisers reach a determined goal, they lack the human intuition for understanding how to deal with gray areas, and are prone to bad decisions when they’re fed bad data. Specifically, they can do major damage to accounts that are using last-click attribution (LCA) models.
Understanding Last-Click Attribution Model
Last-Click is one of the 6 different attribution models offered by Google Ads. It gives all the credit to the ad and keyword which was last clicked before a conversion.
For example, let’s say you are advertising athletic shoes. There’s a sequence of queries done by a user that goes something like this: “Sneakers” > “Running Shoes” > “Adidas Running Shoes” and finally they search for “Ultraboost 19”. This is just a simple example to illustrate that users tend to start with broad queries and get more specific as they get to understand what it is they might want to buy.
If your campaign is using the Last-Click attribution (LCA) model, then all the credit for the conversion will be given to the ad shown for the final query: “Ultraboost 19”, and no credit will be given to any of the queries that preceded it.
Conversion Funnels and LCA
So why is this so bad? When you give all the credit to the last-clicked ad/keyword, it’s like saying you don’t think there was any value to all the queries along the way that helped the user become aware and familiar with your offering. You’re assuming the user would have discovered to search for “Ultraboost 19” without having been exposed to any of your other ads. This is generally a false assumption, especially for consumers who are not very familiar with your brand and its latest offerings.
Consumers today have more interactions than ever before with brands while researching what to buy. Brands that are not present at the earlier stages of a user’s discovery process may not be in contention to win their business later down the line.
So using last-click attribution would mean that “Sneakers”, “Running Shoes” or “Adidas Running Shoes” are assigned no value.
Attribution Models Inform Optimizations
Why is it so important to assign the correct value? Doesn’t the attribution model just change the numbers in reports? The answer is ‘no,’ the attribution model populates the conversion and conversion value metrics and most account managers rely on these to decide where to allocate their budgets, where to change bids, what queries to add as keywords, and what negative keywords to add.
This could all be okay if a human was managing all this manually. For example, while the lack of conversions for a keyword like ‘sneakers’ might normally be grounds for a bid reduction, an account manager would likely realize that they’d still want to bid for this keyword. Human judgment would win out over purely following some logical rules and the account might do fine.
But like I said before, automation is increasingly doing more of the day-to-day account management and it lacks the human judgment that averted disaster in this scenario of an advertiser using last-click attribution.
Smart Bidding + Last-Click Attribution
When last-click attribution is being used, the keywords “Sneakers”, “Running Shoes” or “Adidas Running Shoes” from the example above, will be reported as non-converting, although they are still valuable keywords because they help consumers unfamiliar with your brand discover your brand’s offerings as they do their research.
Now here’s where results can get really bad… by combining bid automation with last-click attribution. The job of automated bidding, like target CPA (tCPA) or target ROAS (tROAS) bidding from Google, is to calculate the appropriate CPC that is needed for the ad to enter the auction.
The ‘right’ CPC is determined one of two ways:
For tCPA, Google uses the predicted conversion rate to calculate CPC
For tROAS, Google uses the predicted conversion value for a click to set the CPC
But if the attribution model hasn’t been assigning conversions to upper-funnel searches, it will predict that conversion rate will be low and that the value per click will be low. So now the automated bidding system will start to reduce bids for these upper funnel keywords. And eventually bids will get so low that the ads may stop showing altogether.
This is bad because it means you’re reducing the volume of prospects who will be exposed to your brand at earlier stages. Eventually your funnel just dries up and the only sales you’re left with are those from people who already knew your brand and products very well — the people who knew to search for “Ultraboost 19”.
Final Thoughts
Considering the significant risk of making bad decisions for the reasons explained above, we advise all our customers to switch away from using Last-Click attribution. If anything, simply switch to a time-decay model which is most similar to last-click while still giving some value to all stages of the funnel.
When it comes to automations like smart bidding strategies, or automated bids using another platform, knowing how they interact with your measurement systems is an absolute must if you want to avert an account blowup.
Black Friday. Cyber Monday. After-hours convenience. Price. Easy/free shipping. All are huge motivators driving people from brick-and-mortar stores to the ease and convenience of online retail. The trend lines are unmistakable. 2018 promises to be another transformational year for eCommerce at holiday time, with many experts predicting double digit increases in online holiday shopping.
Billions of dollars will be up for grabs.
PPC pros have an unprecedented opportunity to be real heroes this year by making sure their company wins more than its share of the shopping frenzy. Working in your favor, holiday shopping is always ripe with intent and immediacy.
Semantics Matter
First, let’s briefly recap the ongoing rapid evolution of the tools at our disposal. Google and Bing are both continually enhancing shopping tools to drive that high-intent searcher to conversion. They have added core automation to streamline the basics of PPC and more advanced tools such as Shopping Ads.
Focusing specifically on the Google platform (but still keeping in mind Bing is remarkably Google’esque with PPC), we all know the greater the specificity of a person’s search, the greater the intent. “Men’s black analog diving watches” tells the Google machine a lot about the searcher’s eagerness. Google can serve up engaging Shopping Ads featuring cool black diving watches to capture eagerness to purchase, serving product-specific ads with click-to-buy ease.
The holiday shopper doing more casual digital window shopping, however, will offer less specific searches such as “Men’s watches” or more vague “gift ideas for dads.” While vague, that shopper likely WANTS to get into a funnel and may need just a little prodding to convert.
In this less-specific search, Shopping Ads and Google’s Showcase Shopping Ads can create immersive and meaningful experiences for people browsing for that perfect gift.
If you haven’t dabbled yet with Showcase Shopping Ads, perhaps you should. They provide pre-click browsing of your products to generate purchase ideas based on more general searches. Previously, PPC pros didn’t have a lot of power to draw casual browsers into their funnel. Showcase Ads are an inexpensive option to meaningfully engage shoppers of modest intent – particularly those meandering for ideas on a mobile device.
Build – Optimize – Automate – Control
While Google and Bing do a good job automating core aspects of search ads for everyday PPC practitioners, the PPC rockstar needs tools like Optmyzr to take their game to new levels. The goal is beating competitors in the second-by-second, search-by-search battle for holiday sales.
The Optmyzr system gives you greater control and automation beyond what Google and Bing offer – and it’s all managed from a single interface. Everything from building campaigns, syncing with inventory, and managing bids to choosing your preferred mix of automation/manual intervention.
Campaign Builder greatly simplifies and automates creation of product group and other campaign structures. Tapping data in your merchant feed, this tool helps automatically align structures by category and craft groups by brand, product type, etc. Campaign Builder’s easy-to-use interface gives you greater control and flexibility to analyze structures to refine and improve them prior to launch. It will also flag gaps in structure that could negatively impact reporting and analysis downstream. In other words, you catch the clunky, annoying misses that would otherwise create headaches or hamper insight after the fact.
Next, let’s talk inventory. Retailers have greater opportunity to serve up ads based on actual inventory – you know…the stuff you have on hand and want/need to sell. Whether you sell cars or speciality holiday dresses or sporting goods, accurate inventory data fed into Optmyzr allows efficient set up and management of hundreds of potential rules and parameters to serve the right ad at the right time. Through rules and automation, you can streamline processes to serve ads based on highly specific product attributes – size, color, style, tech specs. Essentially, if you have data about the products, Optmyzr drives powerful tools to serve the ads aligned with that highly specific search.
Finally, let’s cover bid management. This is where a third-party tool like Optmyzr layers exceptional power on top of the standard automations from the search engines.
The day-to-day task of managing bids can be horribly time consuming, but it’s really at the heart of taking campaigns from basic to extraordinary. For those who need to manage basic modifications in bulk – such as blanket modifications across a product group, our Shopping Bidder tool allows a PPC pro to do that in minutes.
PPC pros, however, often want/need to make decisions at a much more granular level. Shopping Attribute Bidder taps data from Google Ads and specific attributes in your merchant feed. This combination deepens the ability for PPC pros to make different bids to accommodate variations based on any number of attributes. You’ll want to read up on GrIP structures to get the most bang for your buck with Shopping Attribute Bidder.
Finally, Optmyzr Rule Engine is an extremely powerful tool in the hands of a PPC rockstar. With this proprietary tool, it’s really quite easy to adjust bids based on deep data points, such as conversion, CPA, ROAS and others. Among the most versatile tools in the PPC toolbox, you can automate bidding structures across pre-set parameters. Big snowstorm about to hit the northeast? Bids can automatically adjust to push snow blowers or skis. July heatwave predicted in the midwest? Rule Engine can push window air conditioners in Milwaukee, Madison and Minneapolis. You can set those rules up well in advance to automate against countless eventualities.
Conclusion
Holiday shopping season always puts eCommerce topics to top-of-mind, so it’s always a great opportunity to talk about Shopping Ads and powerful bidding tools. Of course, we all want to capitalize on the November-December gift buying frenzy, but these tools are 12-month necessities to allow PPC pros to beat the competition.
People are out there searching for your products/services right now. Make sure they find you before they find your competitor.
Of course, if you want a free 14-day trial or demo, just let us know.
Search queries are still the primary source of traffic for search campaigns, so it’s important to monitor the ones your ads show for so you can remove irrelevant ones (add them as negative keywords). It’s also a good idea to add high-performing search queries as keywords because you can write more specific ads for them.
Optimizing to increase Quality Score is one way to reduce your CPA and increase ROAS. Even though Google is automatically setting your bids in the auction, a high Quality Score requires a lower bid.
This isn’t about setting bid adjustments for different times of the week; your automated bidding strategy already does that. We’re talking about allocating campaign budgets to the more lucrative times of day by turning your ads off when they’re not profitable, making it something of a budget optimization.
Pause keywords that have not converted in a long time but have accrued significant cost. This optimization should only be done if you aren’t running on last click attribution. Otherwise, you’ll pause top-of-funnel keywords and eventually reduce conversions.
You did budget optimizations before automated bidding, and you should continue to do them now. Reallocating budgets across campaigns based on performance helps improve overall account ROAS.
If you’re running on the standard automated bidding strategy (target CPA and target ROAS), you can tweak targets at the ad group level. There are two instances where I’d recommend doing this:
Ad text automation is probably one of the last things that will happen in PPC — writing ads always involves subjectivity and creativity. Responsive Search Ads are a step in that direction, but they only combine headlines and description lines; you still have to write them.
Perhaps one of the most important things you can do is set up alerts to notify you of sudden changes in traffic, conversions, CPA, ROAS, or any other KPI that’s important to you.
Knowing when to pivot is critical to success, be it in PPC or any other business. It’s a good idea to regularly check on the performance of your campaigns’ bidding strategies to see if you need to pivot.
Regular account audits are so important for good structure. Check for things like too many keywords in an ad group, too few ads, campaigns with not enough negative keywords, or campaigns missing site links.
