What Are the Latest Changes to Google Ads Smart Bidding Strategies?

Summary

Recent changes to Google Ads Smart Bidding strategies include enhancements to automation, data usage, and increased flexibility in bid adjustments. These updates are designed to improve campaign performance and efficiency by leveraging advanced machine learning algorithms.

Introduction to Smart Bidding

Google Ads Smart Bidding is a suite of automated bid strategies that use machine learning to optimize for conversions or conversion value in every auction—a feature known as "auction-time bidding." It is designed to improve ad performance and maximize return on investment (ROI) by automatically adjusting bids for each auction based on the likelihood of a conversion.

Recent Changes and Enhancements

Improved Machine Learning Algorithms

Google has enhanced its machine learning algorithms to better predict conversion rates and conversion values. These improvements allow Smart Bidding to make more accurate bid adjustments based on a variety of signals, including device, location, time of day, language, and operating system. These enhancements aim to increase the precision of bid adjustments and improve overall campaign performance.

Increased Use of First-Party Data

With increased privacy regulations and the phasing out of third-party cookies, Google Ads has shifted to using more first-party data in its bidding strategies. Advertisers are encouraged to use their own data, such as Customer Match lists, to refine targeting and bid optimizations. This change helps maintain ad relevance while respecting user privacy.

Flexible Bid Strategies and Controls

Google has introduced more flexibility in bid strategies, allowing advertisers to set target return on ad spend (ROAS) and target cost-per-action (CPA) at the campaign or portfolio level. Additionally, new controls have been added to help advertisers better manage their budgets and allocate spend across different campaigns or keywords.

Seasonality Adjustments and Simulators

Google has introduced tools like seasonality adjustments and bid simulators to complement Smart Bidding. Seasonality adjustments allow advertisers to inform Smart Bidding of expected conversion rate changes during special events or promotions, ensuring that bid strategies remain adaptive. Bid simulators provide insights into how different bid levels could impact performance, helping advertisers make informed decisions.

Examples of Smart Bidding Strategies

Target CPA (Cost Per Acquisition)

This strategy sets bids to help get as many conversions as possible at the target cost-per-acquisition (CPA) you set. It is useful for advertisers focused on maximizing conversions within a specific budget.

Target ROAS (Return on Ad Spend)

This strategy sets bids to maximize conversion value while trying to achieve an average return on ad spend (ROAS) equal to the target you set. It is suitable for retailers or e-commerce businesses focusing on maximizing sales revenue.

Maximize Conversions and Maximize Conversion Value

These strategies focus on increasing the total number of conversions or conversion value received, without a specific target CPA or ROAS. They are useful for advertisers looking to get the most out of their budgets without strict ROI requirements.

References

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