4 Google Ads Smart Bidding Strategies

When you get started with Google Ads, bid strategies might seem complex. There are plenty to choose from, especially when you create your first campaign. We cover the 4 Google Ads smart bidding strategies below, which have become a best practice when you set-up your campaigns. If you view the video and read the corresponding article, you will understand how to use smart, automated bid strategies and select the best one for your business.

What Does Smart Bidding Mean?

Google Ads looks at a variety of factors during every auction to return the ads that are the most likely to convert. They use auction-time bidding and machine learning to enter your ads into auctions where they are the most likely to convert. For example, they will look at a search query and determine the searchers device, location, time of day, browser, operating system, and more.

In Google’s words:

Smart Bidding refers to bid strategies that use machine learning to optimize for conversions or conversion value in each and every auction—a feature known as “auction-time bidding“.

Setting Your Smart Bidding Strategy

If you don’t see the option for Target CPA or Target ROAS, you will have to choose either Maximize Conversions or Maximize Conversion Value. Then, you can choose to set a Target Cost-Per-Action or a Target Return on Ad Spend.

google ads maximize conversions value

Google Ads Smart Bidding Video

You can watch the video below or you can watch it directly on YouTube. It will show you exactly how to set your smart bid strategy and some tips for getting started. You will need conversion tracking set-up properly first.


4 Google Ads Smart Bidding Strategies

At the time of writing this article and creating the video above, there are 4 smart bidding strategies. A bidding strategy is considered ‘smart’ if it is automated and uses machine learning to optimize for conversion goals. If you are not using conversion tracking, you won’t be able to use these bidding strategies through Google Ads.

  1. Maximize Conversion Value
  2. The Maximize Conversion Value bid strategy tells Google Ads to drive as much revenue as possible for your business based on your budget. You don’t set a specific target for your return on ad spend. It’s an ideal bid strategy for eCommerce websites and companies with prices attached to their conversions.

    If you are utilizing conversion tracking with value, which you should if your key performance indicators have a value attached to them, then you can set your bid strategy to maximize value compared to your spending.

    maximize conversion value target roas smart bidding


  3. Target ROAS (Return On Ad Spend)
  4. The Target Return on Ad Spend bid strategy tells Google Ads to optimize for conversion value and you set a target for your ROAS. It will use your previous conversion data and campaign data to optimize your campaign for a specific percentage return on your advertising spend.

    target roas bid strategy

    If you create a campaign for an ecommerce store, you want to use import your conversions and conversion value for tracking, and then use the Target ROAS bid strategy. If you are spending $10 per day for example, you can optimize for a 200% Return on Ad Spend (ROAS) so for every $10 you spend, your campaign returns $20 in revenue.


  5. Maximize Conversions
  6. The Maximize Conversions bid strategy tells Google Ads to drive as many conversions as possible within your budget.

    When you first create your campaign and you start driving some conversions, you might want to use the Maximize Conversions bidding strategy. It works exactly as it sounds: Google Ads will use all the data they have about your campaign to enter your website into ad auctions that are most likely to drive conversions.

    maximize conversions target cpa smart bidding


  7. Target CPA (Cost-Per-Acquisition)
  8. Target Cost-Per-Acquisition is a bidding strategy that optimizes for conversions at a specific cost. Google Ads will use your conversion data and you can set your Target CPA when you are setting up your bidding strategy. For example, if a conversion is worth $50 for your business, you want to set a Target CPA that is lower than the worth of your conversion. Therefore, you can drive optimal conversions for your business.

    target cpa bid strategy

    In my experience, you can lower your Target CPA over time as you get more campaign data and test your ads, keywords, audiences, ad assets, and more while optimize your Google Ads campaign.


In Summary

Smart bidding is a feature that continues to improve through Google Ads. I’d highly recommend using one of the four smart bidding strategies along with conversion tracking. You will see the best campaign results with that strategy. If you have any questions or comments, please leave them in the comments section.



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