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Meet the New AdWords Flexible Bid Strategies: When to Use Them & What's Missing

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bid-mouseAdvanced paid search management tools such as Kenshoo, Marin, Acquisio, and IgnitionOne have always provided SEM managers with advantages that AdWords just could never match. One of the key reasons agencies and advertisers chose to utilize paid search management tools was the access to advanced bid algorithms.

Announced on Inside AdWords, you now will be able to utilize flexible bidding strategies in enhanced campaigns. These bid algorithms offer significant improvement and a wide variety of options compared to enhanced CPC and conversion optimizer options that were previously available and also allow you to mix and match bid rules across campaign and ad groups.

Here's a breakdown of the bid rules now available and their potential uses.

Target Search Page Location

The blog post explains this bid rule as "Automatically tries to get your ads to the top of the page, or onto the first page of search results." Similar bid rules are available within other paid search management tools that actually may provide better results. The explanation provided by Google in this blog post specifically calls out altering your bid for the top of the page or climbing onto the first page of results.

This type of bid rule compares directly to bid to position bid rules that are available in other paid search management tools except it doesn't offer as much flexibility. Bid to position bid rules allow you to select the position you would like to target, not just the top position. This can allow you to control your position instead of just having your bid pushed up to get your ad in the top spot.

When it makes sense to use this bid algorithm: Usually one of the less used options, taking hold of the top spot can be useful for branded search queries and fighting off any pesky competitors bidding on your brand name.

Maximize Clicks

An upgraded bidding option from the old "Automatic Bidding" option, this will maximize the amount of clicks you receive within a set budget.

When it makes sense to use this bid algorithm: If you're attempting to drive as much possible traffic to your site but have a limited budget, this option will fit your goals. This is a great option for a general awareness campaign but isn't something that should be utilized for lead generation or retail.

Target CPA

target-personAn updated version of Conversion Optimizer, this bid algorithm will alter your bids to reach a CPA goal you have provided.

When it makes sense to use this bid algorithm: One of the most commonly used bid optimization rules, if you happen to have a target dollar figure you are willing to spend on advertising to convert a new customer, this is your best option. This type of bid rule is often utilized in lead generation campaigns.

Enhanced CPC

An updated version of Enhanced CPC, this option automatically adjusts your bid on the likelihood of you receiving a click. You might end up seeing Google continuously raise your bid into the top position to generate clicks.

When it makes sense to use this bid algorithm: The blog post on Google calls out "when conversions are the main objective, but you also want control over keyword bids." In essence this is a more flexible version of the Target CPA algo.

What's Still Missing?

While these options are a big improvement and may cause some agencies/advertisers to not make the investment in a paid search management tool, there are still some options that are missing.

  • Revenue based bid rules: Specifically catering to retail, tools like Kenshoo and Marin allow you to upload or input revenue/margins generated from sales. When you're selling multiple products that have different costs and margins, a simple CPA bid rules won't provide you with what you need.
  • Profile based bid rules: Some paid search management tools allow you to set an overall target for your entire set of accounts. For example, if you run a lead generation company and want a 20 percent ROI across all of your engine accounts, you can set up a bid management algo that takes into account every single keyword you manage and alters bids to drive that specific ROI.

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