Choosing the right Google Ads bidding type and implementing a solid strategy for adjusting bids is critical to driving your ad costs down.
If you don’t know what you’re doing, you can end up wasting your entire budget on just a few clicks.
But when you make the right moves, you can take your campaign performance to a new level.
Just changing the bidding strategies can lead to an increase in conversions of up to 142.86%.
In this post, we’ll walk you through all the different types of Google Ads bidding strategies, and how to use them to your advantage.
When launching a new campaign on Google Ads, Google asks what type of bidding you want to use:
Automated? Manual?
Most people opt for automated because who the heck wants to adjust bids all the time if you’re running multiple campaigns? Nobody.
But unfortunately, it’s not as simple as just choosing “automated” and starting to cash in your checks from Google Ads sales.
There are 11 different bidding strategies available, and they all have their time and place.
You need to be familiar with all of them to make the right choice.
Google Ads Bidding Strategies: Your 11 Options in 2020 Explained
On Google Ads, there are currently 11 different types of bidding that you can use for a variety of goals.
In this section, we’ll break down each one and what its ideal use case is, including the new maximize conversion value option.
- Target CPA (Cost Per Acquisition)
- Target ROAS (Return On Ad Spend)(Return On Ad Spend)
- Maximize Conversions
- New: Maximize Conversion Value
- Enhanced Cost Per Click (ECPC)
- Maximize Clicks
- Manual CPC Bidding
- CPM Bidding (Cost Per Thousand Impressions)
- CPM Bidding (Cost Per Viewable Thousand Impressions)
- CPV Bidding, (Cost Per View)
- Target Impression Share Bidding
We also cover two options recently made obsolete, and what bidding strategy Google Ads made to replace them:
- Obsolete: Target Search Page Location
- Obsolete: Target Outranking Share
Let’s take a closer look at our options.
Google Ads Bidding, Option #1: Target Cost Per Acquisition (CPA)
Target CPA bidding is a bidding strategy you can use if you want to optimize conversions. If driving conversions are your primary goal for the campaign, selecting Target CPA bidding will focus on trying to convert users at a specific acquisition cost.
With this method, Google Ads will automatically set your bids on each campaign based on your CPA. While some conversions may cost more, others may cost less to even out and align with your acquisition costs.
Target CPA bidding can be complicated if you don’t know what your acquisition costs are.
Your Cost per Acquisition is simply the amount of money you can afford to spend on acquiring one customer.
For example, if you sell a product for $50, you don’t want to set your target CPA at $50. That would be breaking even when the goal is to profit.
When selecting this bidding method, you can enter your target CPA, and you’re good to go!
Back To Google Ads Bidding Options List
Google Ads Bidding, Option #2: Target Return on Ad Spend (ROAS)
Target Return on Ad Spend is a bidding strategy that throws most for a loop.
Why?
Because it requires some math. Yes, math, the dreaded, awful subject that most marketers run from.
Unfortunately, math is important on this one.
Target ROAS is the bidding strategy where Google Ads will set your bids to maximize conversion value based on the return you want from your ad spend. This number is percentage-based.
Let me give you a basic example:
On your next Google Ads campaign, you want to generate $10 for every $2 spent. To do the math, you follow this formula:
Sales ÷ ad spend x 100% = Target ROAS
Doing the math for the example above, here’s what the Target ROAS would look like:
$10 in sales from campaign ÷ $2 ad spend (clicks) x 100% = 500% target ROAS
Easy enough, right?
Here’s what the Target ROAS bidding strategy looks like when creating a new campaign:
If you still aren’t sure what to set as your percentage, you can navigate to a previous campaign on Google Ads and modify your columns.
Add the following metric to your columns:
Conv. value/cost
Use the number from your top-performing campaigns as your new Target ROAS.
Back To Google Ads Bidding Options List
Google Ads Bidding, Option #3: Maximize Conversions
Maximize Conversions is one of the simplest bidding strategies that Google Ads offers.
Using the maximum daily budget that you set, Google will automatically run your bidding for you to get you the most conversions for your money.
For example, if your daily budget is $50, Google will spend it wisely to find the most conversions.
If a single conversion costs $50, Google won’t bid on it for you.
Before selecting this bidding method, be sure to check that you set your daily budget amount at a reasonable level that you’re willing to spend.
At the end of a campaign, check your return on investment to see if maximizing conversions lead to profitable sales.
Using this strategy, you don’t have to enter any details upon setup (aside from your daily budget).
In 2019, this bidding strategy was made available for TrueView for action campaigns on YouTube Ads.
Back To Google Ads Bidding Options List
New: Google Ads Bidding, Option #4: Maximize Conversion Value
The maximize conversion value strategy was added in August 2019 and is the newest bidding strategy on the platform.
It works essentially like Target ROAS, with the Google Ads algorithm trying to maximize the return on your ad spend.
The difference is that you don’t have to specify a target ROI, you just let the algorithm try to maximize all your ad spend to the best of its ability.
Back To Google Ads Bidding Options List
Google Ads Bidding, Option #5: Enhanced Cost Per Click (ECPC)
In a few words, it’s a mix of manual and smart bidding. You set the basic CPC for your ad groups and keywords, but the algorithm gets to optimize them.
Google has the right to increase or decrease your bid amount based on the likelihood of driving the sale. Bids will try to be averaged out at your max cost per click settings.
If a search is too competitive and CPCs are outrageously high, Google can lower your bid to cost less due to decreased chances of converting.
If it’s an easy steal by increasing bids, Google will make the call.
This type of bidding is available on both the Search and Display networks.
You can choose whether you want the algorithm to enhance your set bids based on a flat number of conversions, or to optimize for the value of the conversions.
This will only work if you’ve created different Google Ads conversions with different values, or if you have dynamic conversion events that track the total value of a sale.
You can set up dynamic conversion tracking with most ecommerce solutions like Shopify or WooCommerce.
Back To Google Ads Bidding Options List
Google Ads Bidding, Option #6: Maximize Clicks
Maximize Clicks is an automatic bidding strategy based on your maximum daily budget.
Google Ads will attempt to drive the most clicks possible with your daily budget.
It doesn’t consider the quality or relevance of the traffic and isn’t ideal for driving sales or other conversions.
Maximize clicks is the best option if you have a very limited budget or limited search volume for the keywords in your campaign.
Back To Google Ads Bidding Options List
Google Ads Bidding, Option #7: Manual CPC Bidding
Manual CPC Bidding gives you more control over your bidding strategy. But, more control means more time spent monitoring costs and adjusting on your own.
If you aren’t well versed in Google Ads yet, this strategy isn’t your best bet.
Manual CPC is where you set bids for different ad groups or keywords on your own. If specific search terms are more profitable than others, you can quickly adjust budgets to add or remove money from other campaigns.
If you have a varied campaign with a lot of ad groups and keywords, manual CPC is a lot of work. You can also end up bidding for a lot of clicks that are unlikely to convert.
Google has the enhanced CPC check-marked by default, so you need to uncheck it to truly select manual CPC.
You’ll see a warning that the campaign may result in low performance, but if your campaign has no data to go on or a very limited budget, it can be the best option.
Back To Google Ads Bidding Options List
Google Ads Bidding Option #8: Cost Per Thousand Impressions (CPM)
Cost per Thousand Impressions, otherwise known as CPM, is bidding solely based on impressions.
This option is reserved for the Display Network and YouTube Ads and isn’t for use on the Search Network (for obvious reasons).
Back To Google Ads Bidding Options List
Google Ads Bidding Option #9: Cost Per Thousand Viewable Impressions (vCPM)
vCPM bidding is a tactic of manual bidding best reserved for brand awareness campaigns.
Again, like CPM bidding, it is reserved for the Display Network and YouTube Ads.
This bidding type is setting your maximum costs on a viewable 1,000 impressions. It counts as a viewable impression after 2 seconds of a video ad is played on YouTube, or 1 second of a display ad is shown on the Display Network.
Back To Google Ads Bidding Options List
Google Ads Bidding Option #10: Cost-Per-View Bidding (CPV)
Cost-per-view bidding is strictly reserved for video advertising on Google Ads and can be used on the YouTube Ads platform. Using CPV bidding, you pay for video views or interactions.
Interactions on YouTube could be any of the following:
- Call to action clicks
- Overlay clicks
- Cards
- Companion banners
A “view” is determined by how long someone watches your video ad for, otherwise known as the duration. In this case, with CPV bidding, a view is counted when someone watches 30 seconds of your ad, your full ad if it’s less than 30 seconds, or whenever they engage with your ad!
CPV is currently the default bid setting for YouTube Ads.
Let me give you a quick example of how it works.
For CPV bidding, you start by entering the highest bid you’re willing to pay for a view or interaction. This is known as your maximum cost-per-view.
For instance, if you set your max CPV to $0.25, you’d pay a maximum of 25 cents when a user watches your ad or engages with your call to action.
So, how do you know what to set as your CPV?
- Start low and adjust based on your results.
- Focus on first maxing out your quality scores and ad rank, these will drive down the cost-per-view on your ads, allowing you to pay less for better results.
- Slowly bump up your CPV to increase your audience reach.
Back To Google Ads Bidding Options List
Google Ads Bidding Option #11: Target Impression Share Bidding
Target Impression Share is a new bidding strategy released in late 2018 by Google Ads.
This smart bidding strategy is focused on brand awareness and helping you reach as many people as possible.
As an example, if you’re looking to dominate impressions for specific keyword searches, like basketball shoes.
Enter your goal percentage of impressions.
Keep in mind that the % impression share is a goal and is affected not just by your bids, but also by the quality score of each individual Google ad group and ad.
So even if you aim for 90% or 100%, you’re unlikely to reach that goal without horribly overbidding for views and clicks.
The impressions also don’t guarantee that your ad is seen or clicked, since it can appear in a lower ad position.
Target Impression Share is mostly an option for your own branded search campaigns and a limited number of key search terms for your brand.
Obsolete: Target Search Page Location
This bidding option was officially removed from Google Ads in June 2019. It cannot be used on any campaigns, new or old.
The bidding option that replaced it is called “target impression share,” and adjusts your campaign bids to target a certain level of impressions.
TSPL (Target Search Page Location) bidding was the strategy of letting Google automatically adjust your bids to always show your ads either:
- On the first page results of Google
- At the top of the first page of Google (1-4)
Back To Google Ads Bidding Options List
Obsolete: Target Outranking Share
This bidding option was officially removed from Google Ads in June 2019.
The bidding option that replaced it is called “target impression share,” and adjusts your campaign bids to target a certain level of impressions.
The target outranking share bidding strategy used to let you try to outbid your competitors. If your ads and your competitor’s ads were both displaying, Google increased your bids to outrank their ads.
It’s no longer available for any campaigns, new or old.
Back To Google Ads Bidding Options List
Choosing the Right Bidding Strategies for Your Campaign
You may know the basics of each bidding type on Google Ads, but where do you even start with figuring out which bidding option is best for you?
It all depends on your campaign goals, budget, and volume.
Every campaign you choose should carefully select a bidding strategy based on desired outcomes.
For instance, if you want to drive sales on the Display Network, picking the CPM is not a great choice.
That’s meant to secure views rather than sales on your site.
Let’s break down a few common goals on Google Ads and the top bidding tactics you can use for each.
Goal: Conversions
If your goal on a specific Google Ads campaign is conversions, or driving traffic to your website or store with the sole purpose of turning them into a sale, consider the following bid types:
- Maximize Conversions
- Target CPA
- Target ROAS
- Target Outranking Share (steal competitors’ sales!)
- Manual CPC (with enhanced CPC enabled)
Goal: Website traffic
If you want to concentrate on driving more traffic to your site with goals other than merely converting, here are a few great bid types to choose from.
- Maximize Clicks
- Target Search Page Location
- Manual CPC Bidding
Goal: Brand awareness
While brand awareness alone is a less common goal on the search network, there are a few great bidding tactics to use for maximum branding.
- Target Impression Share Bidding
- Target Search Page Location
- Target Outranking Share
- CPM and vCPM for YouTube and Display Networks
When to Use Manual Bidding vs. Smart Bidding
Should you use automated bidding, or stick to painstakingly setting and updating bids manually to the best of your ability?
Unfortunately, there’s no right option for every single campaign or advertiser.
Two main factors determine if smart or automated bidding will be a viable option:
- The quality and detail of your conversion data.
- The volume of your campaign (in terms of traffic and conversions, not ad spend).
Smart bidding options focused on conversions (target CPA, target ROAS, maximize conversions, and maximize conversion value) rely on the Google Ads conversion data.
If you set up your conversions incorrectly, like including a conversion tag on every page, this can have catastrophic results.
You can end up overbidding 10x for clicks (consistently $20+ for a $2 keyword) because the algorithm thinks you’re landing multiple conversions per visit.
This can lead to you wasting hundreds, if not thousands of dollars in just a few days.
Are your conversions set up correctly? Do you have multiple conversions or dynamic conversions that show the real value of a sale or conversion?
Unless you can answer yes to both questions, conversion-focused automated bidding isn’t a good option.
If you only use top-of-funnel conversions like unqualified leads, this can lead to poor optimization by the algorithm, focusing on cheap leads that don’t end up converting into sales.
If possible, you should also include bottom-of-funnel sales events.
The next factor you want to consider is whether you even have enough traffic and conversions for the algorithm to effectively handle your campaign.
Google officially recommends 30+ conversions (or 50+ for target CPA) over a period of a month or longer.
To get reliable results, you should get at least 50-100 conversions every single month (from the single campaign that you’re optimizing, or a range of campaigns if using a portfolio bidding strategy).
If you have the right foundation, smart bidding can be a powerful tool and help you optimize your campaigns more than ever before.
Smart campaigns have been shown to drive up to 89% more conversions ― and cost 32% less per conversion for high volume campaigns.
Best Practices for Choosing a Bidding Strategy
To make sure you’re on the right path, follow these 4 Best Practices:
- Select a bidding tactic based on your campaign goals and volume instead of randomly deciding on an option.
- Test different bidding strategies (with A/B tests) for a few weeks and see how performance changes.
- Measure your key performance indicators like conversions, conversion rate, cost per conversion, conversion value, and more.
- Stick with the one with better results!
Don’t jump from strategy to strategy hoping for better results in an unoptimized campaign.
If you don’t have the right keywords, ad groups, or ads, no bidding strategy will help you. Go through our quick 7-step Google Ads audit to make sure your campaigns are up to scratch.
3 Easy Google Ads Bidding Tips to Drive More Sales
Since bidding can get complicated fast, here are a few simple bidding tactics that you can leverage for better, cheaper sales (and less time pounding your head on the desk).
And you can start right now (well… after you’re done reading this, of course!)
Google Ads Bidding, Tip #1: Set Bidding Automation Rules to Make Your Life Easy
Don’t you wish that you could set and forget bids? We all do.
Monitoring bids is a crucial step in maximizing conversions for cheap, but being on Google Ads all day isn’t realistic.
Thankfully, Google Ads packs some powerful automation tools. Using rules on Google Ads, you can set up notifications, pause campaigns, and adjust bids without ever touching them yourself.
For instance, do you want to be notified when CPCs go sky high? You can do that.
How about when CPAs are low, and you want to skyrocket bids? You can do that too.
Use rules to automate your bidding even further.
A great basic rule is to increase the daily budget automatically if you’re getting conversions at an incredible value.
The actual cost point will depend on your campaigns and conversion value, but this is how you create the rule.
In the rules tab, click the blue plus icon.
Set the name for your campaign rule, choose the campaigns you want it to affect, and set the action. In this case, you want to increase the budget, but still keep a max limit you’re comfortable with.
Then, you need to set the condition. In this case, we want it to be a conversion cost lower than X, so click conversions, then cost/conv. on the menu.
Then set it to a number that’s a great value conversion for your campaign.
Save your new automated rule, and go back to the menu to admire your handiwork.
Make sure that the action, your campaign limit, and the conversion cost condition, are all set correctly before letting the rule start to do its work.
Google Ads Bidding, Tip #2: Leverage a Portfolio Bid Strategy to Optimize Multiple Campaigns at Once
A portfolio bidding strategy groups together multiple ad groups, campaigns, and keywords.
It’s only a useful tool if you’re using an automated bidding strategy, and want to optimize your results across multiple campaigns.
With a portfolio bidding strategy focused on ROAS, the algorithm will automatically try to maximize spend between campaigns, to win the keywords and clicks that are really delivering results.
Portfolio bidding can also be useful if a single campaign on its own has limited data when it comes to conversions or traffic for smart bidding.
To create a new portfolio bid strategy, simply click the “Use a portfolio strategy” link below the bidding option. (You must first select a smart bidding strategy to see the link.)
After that, check the “Create new portfolio strategy” box and set a name for your new strategy.
Next, repeat this step for all relevant campaigns. Except, select “Use existing portfolio strategy” and choose the one you created.
This will consolidate your campaign data and help the algorithm make better decisions for your campaigns on the whole.
Google Ads Bidding, Tip #3: Adjust Bids by Demographic Success
Each campaign you run will target multiple demographics and searchers. But apparently, your content won’t appeal to everyone.
Some demographics and age groups are much more likely to buy from you, especially if you sell eCommerce products with Google Ads.
Thankfully, Google lets you customize bidding based on demographics.
For instance, let’s say you notice that you have a demographic with huge CTRs and performance:
You can select that demographic and set up a bid adjustment manually:
If they are performing well, increase their bids for more performance and allocation of your budget toward this group.
Spend your money where it’s already performing at its best.
How to Implement New Google Ads Bidding Strategies on AdEspresso
As of January 2019, AdEspresso has made game-changing updates to their Google Ads platform!
Before, the only bidding strategies available on AdEspresso were:
- Maximize conversions
- Maximize clicks
Now, with new updates, you can manage the following bid strategies directly on AdEspresso:
- Maximize conversions
- Maximize clicks
- Manual CPC
- Enhanced CPC
- Target CPA
- Target ROAS (Portfolio & Standard)
- Maximize Clicks (Portfolio)
- Target Outrank Share
- Target Search Page Location
- Search Page Location
WOOO! 🎉
To get started, you’ll want to create a campaign on AdEspresso under the Google Ads selection:
From here, you can edit the bidding selection on our campaign settings.
Here you’ll notice an option to “select your bid strategy.”
Clicking here will open up a drop-down menu of the current bidding options available for your campaign:
To use portfolio bidding strategies, simply select “Create a new portfolio strategy.”
It’s that easy!
Creating campaigns on AdEspresso is simplified and reflects the same options you find on
Google Ads without the hassle.
Can’t wait to get started editing your campaigns in AdEspresso? Go ahead and claim your 2-week free trial now!
Google Bidding Strategies: Conclusion
When launching a new campaign on Google Ads, choosing the perfect bidding format isn’t easy.
There are tons of options to pick from, and if you don’t have experience with each, the decision could make or break your campaign.
Before selecting a bidding option, assess your goals.
Do you want better brand awareness? Website traffic? Direct sales? Each of these will generate different bidding strategies for best results.
Next time you run a Google Ads campaign you can feel confident in your bidding abilities.
