10 Proven Keyword Bidding Strategies to Optimize Your AdWords Campaign

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By Kimmy Maclang on June 11, 2018
Kimmy Maclang

Search advertising is essentially a competitive game in which marketers and advertisers continuously optimize their strategies in attempts to outrank each other. AdWords is Google’s search advertising platform, which allows you to manage search ad campaigns. Apart from being the most popular SEM platform worldwide, AdWords also offers flexible targeting options and advanced optimization capabilities.

You want your ad to be placed front and center of your target market. But, when it comes to that coveted top spot on search engines, it’s not always that easy. Google looks at other factors such as your CPC bid and quality score to determine your ranking. As such, advertisers should be very careful in researching and selecting keywords to focus on.

No matter how competitive the target keyword is, your ability to compete with other advertisers will be strongly based on your keyword bidding strategy. Bidding strategy will also affect your campaign’s efficiency because it allows for more accurate audience targeting.

So, if you want to get the most out of your SEM campaigns, you need to play the bidding game.

Manual Keyword Bidding

Manual bids are the best way to learn about how your advertising money is paying off. You can set bids at the ad group level or the keyword level to maintain consistency across your campaign. Keep in mind that keyword level gets precedence since the bidding happens on the search query level.

Use the AdWords Keyword Planner tool to help you research and select keywords for your SEM campaign. Choose keywords that you think your target market will use to look for a product or service like yours, and the Keyword Planner Tool will suggest a reasonable starting bid.

If you’re uncomfortable with Google’s suggestion, then start out with an amount that’s appropriate for your advertising budget and risk appetite.

Automated Keyword Bidding

Automated bidding strategies work best when you have “clean” historical data from previous campaigns (to allow AdWords to predict the outcomes of future bids). Here are a few recommended bidding strategies you can try:

  1. CPC Bidding

Focusing on clicks is arguably the simplest keyword bidding strategy. If you want to generate website traffic, then you can do it one of two ways: manually manage your maximum CPC bid by setting a bid for each ad or automatically maximizing clicks by setting a daily budget.

Each strategy comes with its own benefit. With manual bidding, you can see which keywords or ads are performing the best. With the Maximize Clicks strategy on the other hand, AdWords will automatically manage your bids to get the most clicks possible within your specified budget.

  1. Enhanced Cost Per Click (ECPC) Bidding

On the other hand, if you want to maximize conversions while generating traffic, then you can use the ECPC strategy, a feature you can use under the manual bidding option. Although this is a manual process, Adwords will give a 30% buffer in case it thinks that your CPC bid is not enough to capture a searcher who is likely to convert.

All you need to do is select your default bid and Google AdWords will automatically increase or decrease your bid based on the platform’s calculations as to whether the click will lead to a conversion.

  1. Target Cost Per Acquisition (CPA)

Target CPA is a Smart Bidding strategy that Google AdWords offers to advertisers who want to increase conversions while targeting a particular CPA. Here, bid and conversion optimization is done on the search query level.

If you’re using conversion tracking (and you should very well be), then all you need to do is set your target amount at the keyword or ad group level. Google will then determine when to show your ads, who to show them to, and how much to charge you for every click so that you can reach your set goal.

Through this, you can adjust your total ad spending. If you want to decrease website traffic while increasing conversions, then you can reduce the set amount for your target CPA. Google will then try to find cheaper leads with potential to convert into sales.

  1. Target Return on Ad Spend (ROAS)

ROAS is another Smart Bidding strategy that helps you hit a target ROI, which essentially means that you’re going after a particular sales amount rather than the number of sales.

For instance, you want to sell products worth a total of $X amount rather than N number of products. The Target ROAS strategy complements well with higher-value products, as sales volume might not be a good indicator of the campaign’s success. This tactic is pretty much only used for ecommerce as it requires conversion values for your products before you can run it.

  1. Target Search Page Location

If your goal is to increase brand awareness and maximize visibility, then you probably want to target the top (or the first page, at least) of the search engine results page. Target Search Page Location automatically bids across multiple campaigns to show your ad at the top of the page or on the first page of SERPs.

Just beware that getting to the top of the page can be expensive. The success of this strategy will highly depend on the relevance of your ad and your CTA.

  1. Target Outranking Share

This strategy is advisable for businesses that want to outrank their direct competitors. Basically, you’re telling Google to show your ads above a specific website domain name.

However, it’s crucial to note that Google doesn’t guarantee you’ll always outrank your competitor, as it will still depend on your competitor’s bid for that keyword. If you’re competing with large companies, then you’ll likely spend far more than you initially intended.

  1. Cost Per View (CPV) Bidding

This strategy only applies to video ads, where you only pay for views and interactions with your video such as clicks on CTA overlays, cards, or companion banners. A view is counted when a user watches 30 seconds of your video or engages with the ad, whichever comes first.

Although CPV bidding can be great for generating awareness, it’s generally not recommended because as far as our experience goes, it’s almost always more expensive.

  1. Cost Per Thousand Impressions (CPM) Bidding

Advertising based on impressions is a strategy used for increasing brand awareness/visibility and is NOT optimized for lead generation or website traffic. Basically, you’re paying for the number of times your ad gets shown on YouTube or the Google Display Network, whether users click through or not.

CPM bidding is only available for video and display ads. Again, you should only be using this strategy if you’re less concerned with user interaction and more concerned with brand exposure. It’s generally more costly and doesn’t focus on driving conversions.

  1. Maximize Conversions

This is exactly like Target CPA, but there’s no specific CPA limitation that you provide. Adwords will just try to get the most conversions possible no matter what.

This bidding strategy is best suited for accounts that get at least 100 conversions a month at a minimum, but the more, the better. This is a relatively new keyword bidding strategy and is only available for SEM campaigns.

  1. Portfolio Strategy

Although this technically isn’t a bidding strategy, it works as an accentuation of all your bidding efforts and adds an extra layer of control.

An optimized portfolio strategy allows you to add bid limits, budget thresholds, and more so that you can more efficiently allocate resources to campaigns that are driving the best returns.

Final Words

Remember, your keyword bidding strategy is the primary determining factor when it comes to the success of your AdWords campaigns. If you’re not optimizing your bidding strategy, you’ll probably end up spending more than you need to reach your goals.

Maximize your ROI and above all, always consider your goals when choosing your search advertising and keyword bidding strategy, as each one is designed for a specific marketing objective.

Happy bidding!

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Topics: Online Advertising, Keywords

Kimmy Maclang

About Kimmy Maclang

Kimmy Maclang is a Content Marketing Writer that helps businesses improve their online presence and increase Google rankings. When she’s not writing, she spends time outdoors with her dogs or crochets. Her love for the arts and crafts led her to creating an e-commerce site for crochet and knitting supplies. Check out her newly launched website at www.wordspright.com.

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