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The Real Reason Why Smart Bidding Is the Most-Converting Bidding Option

Miguel Saballos

2 years ago



Google has figured it out! Automated solutions are the key to optimal digital advertising campaigns. One of the most critical parts of PPC is the auction in which you secure your ad placement. This is why Google created automated bidding options, leaving no room for human errors.

Take a look at these success stories!

  • registered a 145% increase in subscriptions after switching to Smart Bidding. This company used Target CPA, and after 20 days, they saw these impressive results.
  • Thanks to Smart Bidding with Target CPA, AliExpress saw a 93% increase in conversions and a 46% reduction in cost-per-acquisition.
  • The global group “Experian” also achieved impressive gains after implementing Smart Bidding. Their conversion rate increased by 18%, and their return-on-ad-spend improved by 79%.

Even with all the stats and success stories, some PPC managers find it challenging to decide whether to bet on smart bidding or play it “safe” with manual. If you constantly find yourself in this dilemma, what you are about to read will help you find the answer.

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Mastering Smart Bidding

Back in 2016, Google announced “Smart Bidding,” the new conversion-based automated solution for bidding. We can define it as a set of automated strategies used to ensure effective and efficient bid management in every auction.

Bidding Strategies

  • Target CPA: This strategy is used to get the highest number of conversions possible. When implementing “Target Cost Per Action,” Google will set a bid based on every auction’s likelihood to convert. With this option, you can set an average cost that works for you, and this is what Google will use as a reference for bidding.
  • Target ROAS: Target Return On Ad Spend analyzes and anticipates the value of a potential conversion when a search fits your products or services. When this happens, the bids are adjusted to maximize return.
  • Maximize Conversions: This strategy is similar to others since it adjusts the bids for your ads when they are eligible to appear. The main difference from other strategies is that Maximize Conversions will always prioritize the cheapest conversions available for your budget.
  • Maximize Conversion Value: With this bidding solution, you have the freedom to choose the value that you want to focus on, whether this is revenue, profits, or other. Once you set up conversion tracking and implement this strategy, Google’s learning mechanism will set tailored bids to maximize conversions.

smart bidding strategies

Why Should You Try Smart Bidding?

No matter what strategy you choose, these automated bidding options have been created with your best interests in mind. This is why all of them are automatically optimized toward the goals you set. Find below the most relevant features that Smart Bidding offers.

1. Multiple Contextual Signals

These signals refer to attributes the algorithm considers when optimizing your bids. For Smart Bidding, many attributes are available, including device, physical location, location intent, and more.

2. Machine Learning Advancements

These advancements refer to learning algorithms that are trained on data at scale so the bid optimizations can be made with a deep understanding of how the amount of a bid could impact each conversion.

3. Flexible Settings

With Smart Bidding, you get the opportunity to set targets and settings for specific business goals. Your bids will be optimized based on attribution models that will prioritize the ad interactions that have had more relevance to maximize results.

4. Insightful Performance Reporting

This feature allows you to get real-time insights on performance at a granular level, simulations on how your ads would perform in terms of key metrics, alerts that flag tracking issues, and suggestions to fix them.

Why Manual Is Not as Efficient as Smart Bidding

With all the advancements in automation we have seen over the last years, some manual tasks like ¨bidding” are becoming less and less relevant. There are indeed some instances in which this option might be of better use, for example, when your campaign is new and there is no data available. In this case, some advertisers expecting to see instant results might prefer to use manual bidding. 

Another reason to go with manual could be when you want to control your campaign fully. Whatever your circumstances, remember that the less efficient you are, the higher your chances of losing the game. 

More Signals Make the Difference

As mentioned before, contextual signals are crucial in optimizing your bids. The attributes you can take into account when you manage your bidding manually are just a few compared to the huge number of attributes that the algorithm uses in Smart Bidding.

smart bidding signals

Time Is Money

One of the most significant benefits of AI and Automation is that it leaves you room to prioritize the most relevant tasks on your plate instead of dealing with all those time-consuming tasks.

The same happens when you go with Smart Bidding. You can rely on this automated solution to manage your bids so that you can focus on high-level marketing strategies, client communication, and lead generation.

Accuracy Is Key

Smart Bidding is handled by AI, meaning there is no room for human errors. Let’s face it! If you are managing multiple campaigns simultaneously, with different ad groups and ads, the probability of making mistakes will be there. With an automated bidding solution, you will not only enhance performance but also get rid of human errors.

Now It’s Just a Matter of Choosing the Right Option

Even though there might be one or two situations in which you could consider manual bidding an option, there is no doubt that smart bidding is not only superior technically speaking but also at a managing level since saving time and resources is crucial for success. Another point in favor of this automated solution is that it offers multiple options that can perfectly align with your goals. 

mart bidding average conversion uplifts

Smart Bidding Pro-Tips

  • Keep a simple account structure with clear objectives and optimal measurement practices to ensure your campaigns’ success.
  • Make sure conversion tracking is enabled so your bidding strategy can work properly.
  • Testing is vital to guarantee that you are using the right bidding option, assets and setup, so try to do it after launching your campaign and when you have enough data to make adjustments.
  • Take advantage of broad keywords since they pair well with this bidding solution. This strategy helps the algorithm learn faster and find the best opportunities to maximize results.

Setting up and managing a campaign with smart bidding might be simple. On the other hand, there will always be some management-level decisions that could be difficult to figure out. 

For example, if you should embrace more automated solutions or keep things manual.

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