Smart Bidding can be a powerful feature in Google Ads. The “Smart” come from the use of machine learning to optimize your bids for conversions or conversion value. This save the tedious process of manually setting bids for your keywords, Smart Bidding automates the process, allowing you to save time and improve your campaign performance through manual optimizations.

How Does Smart Bidding Work?

Google’s Smart Bidding algorithms analyze a vast amount of real-time data, these include user device, location, time of day, and search query, to determine the optimal bid for each auction.   It then adjusts your bids automatically to achieve your conversion goals.

Types of Smart Bidding Strategies:

There are several Smart Bidding strategies available, each designed to meet specific campaign objectives:

  • Target CPA (Cost-per-acquisition): This strategy aims to get you as many conversions as possible at or below your target cost-per-acquisition (CPA).
  • Target ROAS (Return-on-ad-spend): This strategy helps you maximize your conversion value while achieving your target return-on-ad-spend (ROAS).
  • Maximize conversions: This strategy focuses on getting you the most conversions possible within your budget.
  • Maximize conversion value: This strategy aims to get you the most conversion value possible within your budget.

Benefits of Using Smart Bidding:

  • Improved performance: Smart Bidding can help you achieve your campaign goals more efficiently than manual bidding.
  • Time-saving: Automating your bidding process frees up your time to focus on other aspects of your campaign.
  • Advanced machine learning: Smart Bidding leverages Google’s machine learning algorithms to optimize your bids in real time.
  • Auction-time bidding: Bids are adjusted for each individual auction.   Taking into account various signals and context to inform the bid.

Best Practices for Smart Bidding:

  • Set clear conversion goals: Define your desired CPA, ROAS, or conversion volume.
  • Ensure accurate conversion tracking: Make sure your conversion tracking is properly set up to provide accurate data to the Smart Bidding algorithms.
  • Provide sufficient conversion data: Smart Bidding requires a certain amount of conversion data to learn and optimize effectively.
  • Monitor your campaigns regularly: Keep an eye on your campaign performance and make adjustments as needed.
  • Be patient: It takes time for Smart Bidding to learn and optimize your bids.
  • Consider starting out on a non-smart bidding strategy: For new campaigns, consider launching on max clicks or target impression share, allowing Google’s algorithm more data to optimize against when you switch to a smart bidding strategy.
  • Consider using a mix of campaign types: Your business may need to select different bidding strategies based on the types of campaigns.  For example Maximize Conversions for a branding campaign and Maximize Conversion Value for a services campaign.

Smart Bidding Strategy Based on Your Business Goals:

  • Increase Sales or Leads: You will want to select either Maximize Conversions or Target CPA.  These campaigns will help you get more campaigns with a fixed budget or ROI.
  • Increase profit: Target ROAS or Maximize Conversion Value is for you! These campaigns allow you to either maximize your return on ad spend (ROAS) or prioritize the highest value conversions on your site.

 

Are There Any Caveats To Be Aware Of:

  • You need robust conversion tracking: I said it earlier but its worth restating.  Without fully flushed out and tracked conversions you aren’t getting the most out of Smart Bidding.
  • There is a learning phase:  To get the most out of Smart Bidding you need data.  To properly evaluate Smart Bidding campaigns Google says you need time, preferably a month.  They also recommend a minimum of 30 conversions or 50 if you are utilizing Target ROAS.

Smart Bidding is a valuable tool for advertisers of all levels. By understanding how it works and following best practices, you can leverage its power to improve your campaign performance and achieve your business goals.   Hope this guide was helpful and best of luck with your Smart Bidding campaigns.