What Are The Different AdWords Bidding Strategies?

Pay per click advertising is all about getting the most out of your budget and surprisingly not many businesses do it correctly. Whether it’s lack of experience or education, many companies often just throw lots of money at their keywords in the hope of making a return. But is that really the best bidding strategy?

Many PPC networks such as AdWords and Bing give users a whole selection of options in order to help them optimise their campaigns. If you want to get the most money from your budget then bidding more on a particular keyword is not the most efficient strategy. To show you how you can improve your campaign and return without tripling your spend, we’re taking a look at the different PPC bidding strategies.

So put your campaign on pause and pay attention, you’ll never look at AdWords bidding strategies the same way again.

What Are Your Goals?

Before we look at specific bidding strategies, it’s important to understand what you are trying to achieve from PPC advertising. Some companies will want to increase their sales and conversions, while some companies want to increase their online presence.

Deciding what you want to achieve will help you decide which strategy is the best for you. Not all strategies are about increasing sales so matching the right strategy to your goal is essential. Let’s take a look at our first strategy, the classic manual cost per click.

Manual Cost Per Click

Manual Cost Per Click

This is by far the most popular and basic bidding strategy; you manually pick a fixed bid for a particular keyword and Google does the rest. Since most beginners don’t want to wake up to find Google has charged them thousands of dollars overnight, many will start off with this strategy.

Although this gives you the highest control over your adverts, it’s not ideal for beginners. Setting a bid too high will result in overspending and setting a bid too low will result in no clicks. It’s a fine line that requires lots of data to help you make the right decision. If you are new to PPC and AdWords then don’t worry, there are plenty of other strategies available, it’s just best to leave this one to the experts.

Automatic Cost Per Click

Automatic Cost Per Click

The next PPC bidding strategy is a useful feature by Google. Their automatic cost per click option gives Google control over your bids and optimises them for you automatically. Based on your daily campaign budget, Google will increase or decrease your bids in order to get the most clicks. This is ideal for both beginners and advanced users as it allows Google to utilise its own data to set the maximum cost per click.

Beginners might be anxious to use it as it can greatly increase your cost per click, but at the end of the day every decision is backed by Google’s own data. Using this option won’t be perfect for everyone especially people with low volume keywords. It’s worth giving it a go to see how it performs but if you don’t see an improvement then don’t feel like it’s your only option. There are plenty of others you can try out too.

Enhanced Cost Per Click

Enhanced Cost Per Click bidding strategy

Similar to the automatic cost per click strategy, this strategy automatically adjusts your bids but only by a maximum of 30% each way. Unlike the automatic cost per click option, this means users can sleep well knowing they won’t wake up to a £10 per click bid. To decide which bid to increase and which to decrease, Google uses its own historical data to determine which keywords are more likely to convert.

This might work great in popular industries such as online shopping, but if there is not enough data for certain niches then Google will struggle. It’s worth giving it a go to see how much it can increase your sales, but for harder niches, we’d suggest using the automatic strategy.

CPA Bidding

CPA Bidding

If you want to optimise your campaign solely for conversions, then this is the strategy for you. In order to activate it you need at least 15 conversions over a span of 30 days. This gives Google data to work with, which then allows you to set an average cost per conversion.

Based on this average cost number, Google will work it’s magic on individual keyword bidding to generate you the most conversions. The only thing that can disrupt the strategy from working are if you have any daily budget caps in place. With the chance of spending much more than you anticipate, this strategy is best left to the professionals.

CPM Bidding

CPM Bidding strategies

If you’re used to using other advertising networks such as banner displays, then you might be used to dealing with CPM. Known as “cost per mile”, in PPC terms it can be translated into “cost per thousand impressions”. It might sound strange for a PPC network to offer CPM bidding but it can, in fact, be very useful.

The feature itself is only available for display network campaigns which don’t appear on Google’s official website. Once your advert has enough views, the option will become available and you’ll be able to adjust your CPM amount. From then on you won’t be charged for any clicks on your ads but instead, you’ll be charged a fixed fee per thousand views. If you have a terrific converting advert this can actually be very beneficial and reduce your average conversion rate dramatically.

Conclusion

As you can see, there are plenty of PPC bidding strategies available, and they don’t all involve increasing your spend. In fact, some strategies decrease certain bids and only increase the ones that perform well. If you thought throwing money at every keyword was the best way to increase your conversions and profit then hopefully you’ve learned that’s not the case.

By using these different AdWords bidding strategies in AdWords, you should be able to increase the ROI of your campaigns without breaking the bank.

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