12 Best Google Ads Bidding Strategies To Win in 2021

Johnathan Dane
Johnathan Dane
Founder/CEO

People for years have believed that Google Ads bidding has been the holy grail to higher performing accounts.

And while they weren’t entirely wrong, the bidding opportunities you have today have grown dramatically.

That’s great news for you.

We’ve even created out own hybrid bidding strategies that have given performance lifts like the ones below:

Average CPC -31% | Cost/Conversion -33% | Conversion Volume +54%
Average CPC -29% | Cost/Conversion -26% | Conversion Volume +33%
Average CPC -34% | Cost/Conversion stayed the same | Conversion Volume +19%

Now beating your competitors in the Google Ads slugfest that happens 40,000 times every second isn’t easy. And more importantly, it doesn’t happen by accident.

There’s much more to Google Ads bidding than just the bid. What’s about audience conversion intent like? Do you have bid adjustments in place? Are you using Smart Bidding from Google?

The checklist can feel endless.

If you’re an eCommerce, SaaS, or lead gen company, we can help you with a custom marketing plan that helps you utilize the best Google Ads bidding strategies specific to your goals. 

Even if you’re still looking for your first Google Ads breakthrough and haven’t yet experienced the joy of virtually destroying your deep-pocketed rivals, I’ve got good news.

All it comes down to is arming yourself with the right tricks, tools, and tactics — 21 to be exact — and then releasing the Google Ads bidding monster.

Let’s jump in…

How Does Google Ads Bidding Work?

Google gives you a multitude of ways to bid for your ads, depending on what your end goal is. Most advertisers focus on clicks, impressions, conversions, or views (for video ads).

Google runs an auction every single time it has ad space available on a website or search result. Then the auction decides which ads will show at that moment in that space. Your bid puts you in the auction. Sounds simple enough, right? 

What to Focus On

Google Ads gives you several ways to bid for your ads, depending on what your business’s goals are, below we break down those options so you can choose which one would best suit your business goals. 

Bid Options:

  • Target CPA
    • Get the most conversions possible at target CPA set by you. This is best to use if you goal is to increase targets and leads
  • Target ROAS
    • Get the most Return On Ad Spend with this bidding strategy. Keep in mind, you should be comfortable spending up to 2 times your average daily budget with a Target ROAS strategy. Target ROAS is best to use for eCommerce campaigns without budget limitations. This is ideal if your goal is to increase profits
  • Maximize Clicks
    • With “Maximize clicks”, Google Ads automatically sets your bids to help get as many clicks as possible within your budget. This is ideal to use when you have a strong conversion performance and want to find more volume. If you want more clicks to your website, this is the strategy for you
  • Maximize Conversions
    • If your goal is to increase sales or leads, you can have Google automatically set your bids to help you get the most conversions within your budget. This strategy is great for using your entire budget in a single day- great for if you want to max out your spend every month.
  • Maximize Conversion Value
    • Google Ads automatically sets your bids to help you get the most conversion value within your budget. Google uses the info gathered surrounding device, location, time of day, demographics, query, and more to find the optimal CPC bid for each auction. 
  • Target Impression Share
    • Target impression share” automatically sets your bids to increase your ads’ chances of appearing in the search page area you select- this is ideal for achieving brand awareness

With so many options to choose from it can feel overwhelming and like you need to spend more to see results, but the good thing is, it’s not just about who is willing to pay the most on Google Ads. They take into consideration many other factors, including:

  • Geo location
  • Time of day
  • Device
  • Audiences your potential visitor is part of
  • Browsing behavior 
  • Intent
  • Expected CTR of your ad
  • Your Quality Score

So don’t feel discouraged if you don’t have a huge budget, Google will still help you reach your goals. 

Three Components of Google Ads Auction Rankings

Every Google Ads auction takes three major elements into account when it decides how your ad should rank:

1) Your max cost-per-click bid for the keyword

2) Your quality score for that keyword

3) Your ad extensions and their relevance to ad and keyword

Like I mentioned earlier, the Google Ads auction happens extremely fast (and extremely often). So it’s vital that you know what’s out there to take advantage of.

Finally, if you’re trying to reach the ultimate level of Google Ads success, then I highly recommend you read my post on Single Keyword Ad Groups (SKAGs), which has more than 250 comments since it was published.

In that post, I talk about the reason why you should care about the granularity of a Google Ads account and how it’ll give you even more of a positive bump for your Google Ads bidding strategies.

With all that said, it’s time to get deep into the details of Google Ads bidding.

Let’s dive in.

Manual vs Smart Bidding

What is manual bidding?

Manual bidding is a bidding method that lets you set your own maximum cost-per-click (CPC) for your keywords. With manual bidding, you only pay when someone clicks on your ad, not just views it. 

Pros

  • Manual CPC bidding gives you control to set the maximum amount that you could pay for each click on your ads.
  • The most granular control you can have over keywords in your campaign

Cons

  • Time-consuming

Potential for worse outcomes due to not using Google’s plethora of data on user behavior to drive bid calculations

It takes experience and deep knowledge of Google to make the campaigns effective, thus making it a bit difficult for new users

Doesn’t take Google’s machine learning into account when trying to find users who are most likely to convert on your offer.

What is smart bidding?

Smart Bidding is a subset of automated bid strategies that use machine learning to optimize for conversions or conversion value in every auction. This is a feature known as “auction-time bidding”. Smart bidding strategies include target CPA, target ROAS, maximize conversions, maximize conversion value, and Enhanced CPC (eCPC).

Pros

  • Uses machine learning to find users that are warmer to your offer than the average searcher
  • Wide range of contextual signals
  • Flexible performance controls
  • Transparent performance reporting

Cons

  • You lack visibility or control over the data being used
  • You lose some control of your budget
  • The broad data Google uses might not reflect your target audience but a more broad audience 
  • tCPA requires a healthy budget to perform properly (your daily budget needs to be at least 2x your tCPA goal for that campaign)

In earlier days when Smart Bidding was introduced, many marketers were skeptical about it, and for good reason. However, Google has done a tremendous job making Smart Bidding better and better and we highly recommend you consider adding it to your portfolio of bid strategies.

Google Ads’ (and everyone else’s) auction-based bidding model originally got its name from the Latin word “augeō,” which means “to increase”.

But “to increase” means to pay more. We don’t want to do that.

We want to make more profit.

When you’re setting goals for your PPC campaign, especially in the context of bidding and the average cost per conversion, you have to factor in the balance between conversion volume and cost per conversion.

For example, you can keep lowering bids, but that will eventually hurt your conversion volume.

You can keep increasing bids too, which might increase your conversion volume. But that will eventually increase your cost per conversion as well.

Best Practices

  1. Make sure your conversion tracking is audited and correct
  2. Make sure you attribution model is audited and correct
  3. A/B test your bidding strategies with Google’s Draft & Experiments feature
  4. Research your goals and choose a bidding strategy that best aligns with that
    • Ex: If you want to increase brand awareness focus on impressions, not clicks
  5. Evaluate the performance of your ads and don’t be afraid to adjust based on your findings 
  6. Be patient and wait for enough data to make the right decision about your bid adjustments – run things until you’ve reached at least a 95% confidence level
  7. Simplify your account structure so you can easily make changes to your bid strategies

Set Clear Goals

When it comes time to decide what you want your ads to achieve it is important to set realistic and attainable goals. It is also important to consider that it is unlikely that all of your metrics will go in the same direction at the same time, but that is okay. When it comes to hitting your goal metrics, it is okay to sacrifice smaller metrics to hit you bigger ones. 

Goal 1

  • Increase conversion rate by 20%

Goal 2

  • Increase ROAS by 15%

Goal 3

  • Decrease CPA by 45%

The Best Different Google Ads Bidding Strategies in 2021

Do you want to do things manually or automatically? The Google Ads bidding strategies we’re about to uncover can help you get closer and closer to your goals.

One thing to keep in mind, however, is that nothing should ever be set on auto-pilot.

You (or your agency partner) should always keep tabs on fluctuations in performance. And if you improve your conversion rates through landing page testing, understand that your bidding goals can improve and change very quickly (for example, higher conversion rates can support more aggressive bidding strategies).

Here’s a look at the different Google Ads Automated bidding strategies available today:

And here’s a look at some of the sub-bidding options you have once you select a bidding strategy you want to try.
Target CPA bidding

Strategy 1: Manual Cost Per Click (CPC)

Manual cost per click allows you to set bids at either the ad group or keyword level.

Setting individual bids at the keyword level allows for the highest level of control. Ad group level manual bids, in contrast, give the same bid to all the keywords or placements within that ad group.

Pros

  • Provides the highest level of control on your bids
  • Your max. CPC bid is the most you’ll be charged for a click, but you’ll often be charged less

Cons

  • Requires more work, time, and experience to get the most of the bids and get the best results
  • Less detailed reports than automated bidding  
  • Doesn’t leverage Google’s machine learning algorithm to find users that are more likely to convert than others

Important Note: Keyword level bids override ad group level bids.

Here’s a look at what that looks like- This give you the option of setting your bids manually, for maximized clicks, eCPC, conversion optimization, and flexible bid strategies

This is usually the best bidding strategy for new advertisers. You can keep a close eye on performance and make sure that none of your ads are overspending.

Strategy 2: Automatic Cost Per Click (CPC)

Automatic cost per click gives Google control to adjust your bids up or down. This helps give you the most clicks within your daily budget for that specific campaign.

This is a decent bid strategy if you need to drastically reduce budgets and don’t want to lose impression share too fast.

It also works well if you don’t have a lot of conversion data and want to gather as much traffic data as possible.

Pros

  • Allows you to quickly launch new campaigns
  • This is a common bid strategy to gather data, quickly

Cons

  • Doesn’t allow you to control things via CPC, CPA, or ROAS
  • Allows Google to bid however high/low they want, which can be scary
Take a peek at what that will look like.

One of the downsides to this bidding strategy is that it doesn’t allow you to set max CPC bids at the individual keyword level.

If some keywords are performing better than others, for example, you may want to increase those specific bids. But if you use automated bidding, you won’t have that level of control.

Another key to remember is that your goal for this strategy isn’t clicks, it’s conversions. So you can test this Google Ads bidding strategy, but it may not work out for you.

Strategy 3: Enhanced Cost Per Click (eCPC)

Enhanced CPC (eCPC) gives Google the freedom to increase or decrease your bids by 30%.

Google tells us that they use historical conversion data and their algorithms to predict which searchers are more likely to lead to a conversion and which aren’t.

In the event that a conversion is likely to happen, Google will increase your max CPC bid by up to 30%. It does the opposite for conversions that are less likely.

Google says that “eCPC can help you get more conversions while maintaining or reducing your cost per conversion.”

It also gives you manual bidding control but still has some wiggle room to bid up for a click if it thinks that user is likely to convert.

But take that with a grain of salt.

If you’re curious, try it on a smaller campaign first. Measure the cost per conversion, conversion rate, and conversion volume as an apples-to-apples comparison.

Pros

  • Typically increases click-through rate (CTR) and conversion rate (CVR)
  • Reach more people in a broader audience

Cons

  • Because of the lack of bid caps, you can see an increase in CPC which could not be profitable for your account
  • The lack of bidding control can see you spending more than you have budgeted for in mere days
  • eCPC is not a standalone automated bid strategy. eCPC works by automatically adjusting your manual bids for clicks that seem more or less likely to lead to a sale or conversion on your website
Simple as that.

Sometimes this is a default bid setting when creating new campaigns, so be aware if you don’t want to use it at that given time.

Strategy 4: CPA Bidding/Target CPA (Used To Be Called Conversion Optimizer)

Also known as conversion optimizer, CPA bidding allows Google to adjust bids to average a certain cost per conversion goal that you’ve set.

Based on the history of your Google Ads account and conversion volumes, CPA bidding needs at least 15 conversions over a span of 30 days to become active.

If you meet those criteria, the CPA bidding can only be held back by budget caps that you might have.

I’ve found that CPA bidding is much more effective on the Google Ads Display Network (where a lot more factors are responsible) versus the Google Ads Search Network. On the latter, keyword intent can be very obvious and lead to a conversion.

As with all Google Ads bidding strategies, always record pre-performance and compare it with post-performance after you implement a new bidding strategy.

Pros

  • If your main advertising goal is getting conversions (like sales, signups, or mobile app downloads), then Target CPA bidding can help automatically get more conversions for your budget.
  • It uses your conversion tracking data to avoid unprofitable clicks and get more conversions at a lower cost
  • Target CPA automatically generates bids to try and meet your target CPA

Cons

  • Cannot be used on shopping campaigns 
  • Does not allow you to separate bids for display network and search network advertising
  • tCPA requires a healthy budget to perform properly (your daily budget needs to be at least 2x your tCPA goal for that campaign)
So, there you go.

Strategy 5: CPM Bidding (Cost Per Thousand Impression)

Only available for Display Network and YouTube campaigns (like remarketing), CPM bidding allows you to set target bids that accumulate after 1,000 impressions.

Google once allowed max CPM bidding but has since changed it to what’s called Viewable Cost Per Thousand Impression bidding (vCPM).

CPM bidding doesn’t charge you for clicks. But it will charge you for impressions of your ads, even if they’re shown below the fold where a user won’t see them.

Pros

  • A great way to raise brand awareness
  • Predictable pricing 

Cons

  • You risk being charged for ads your audience isn’t actually seeing
  • ROI on CPM can be lower on low trafficked sites
  • High trafficked sites can leave you “viewed” without being seen, causing you to spend more on poor results
 Here’s what that will look like.

Voila!

Strategy 6: Target Search Page Location (No Longer Exists)

Are your ads performing really well in a specific page location, like above the organic search results or on the sidebar? Then this bid strategy will be fun for you to test out.

Target Search Page Location, in addition to being a really long name, automatically adjusts bids to help you get your ads to the top of the page or the first page of search results.

In other words, this bid strategy will give you the best chance of being included at the top of page #1 in the SERPS.

Pros

  • Higher ad visibility with the potential of free exposure if your ad isn’t clicked
  • Potentially higher click-through rate 

Cons

  • If you do not keep an eye on it it can increase your ad expenses on its own
  • Clicks are not guaranteed to be accurately targeted than those with a lower CPC, costing you more money for the same results 

Here’s a look at the options you used to be able to set:

This is what it used to look like

 Strategy 7: Target Impression Share

Target impression share bidding automatically sets bids to help achieve your Impression Share goal across all campaigns using this strategy.

There are three options for the Target impression share strategy, depending on where you want your ads to show: 

  • On the absolute top of the page, 
  • On the top of the page, 
  • Anywhere on the page of Google search results. 

Google Ads automatically sets your bids to show your ad, based on your placement settings.

The Max CPC bid limit is a cap on bids set by this bid strategy. If you set your limit to low you risk restricting your bids which can effect your goals. 

Pros

  • Great for brand keywords that you want to ensure you’re showing up for as much as possible (target 95% impression share)
  • Helps ensure that your search top IS is exactly where you want it

Cons

  • Lose control of limiting max CPCs
  • Doesn’t necessarily optimize for conversions
This is what it used to look like

Strategy 8: Target Outranking Share

Are you basing all your performance goals on how much you can outrank a certain competitor?

This bidding strategy could help you out quite a bit. (It also strokes the ego… and can be a little bit dangerous.)

By entering your competitor’s domain, you can tell Google how often you want your bid to outrank them. This is called the “Target outranking share”.

Pros

  • Increases search visibility over a direct competitor through specified targeting 
  • You can take the market share directly from a competitor with Target Outranking

Cons

  • Much more expensive than other strategies, in particular, if you are targeting competitors which better quality scores
Pretty cool, right?

If you set your target outranking share to 50%, then Google will bid to outrank that specific competitor in 50% of the auctions.

Strategy 9:  Maximize Clicks

This automated bid strategy is just like automated CPC bidding.

Again, be aware that this strategy can lead to lower-quality clicks, which can lead to lower-quality conversions.

Pros

  • Simple and straightforward – this is a basic automated bidding
  • Most efficient strategy for traffic generation

Cons

  • Clicks tend to be lower quality
  • Less targeting = less desirable results 

Strategy 10: Target Return On Ad Spend (ROAS)

Do you have a certain ROI you want to hit when it comes to your PPC agency spend?

If so, targeting return on ad spend (ROAS) might be for you. ROAS is a metric that takes your conversion values (set at the conversion tracking stage) or Google Analytics eCommerce revenue values into account.

Let’s say you’d like a 7x ROI. This means that for every $1 you spend on clicks, you’re expecting $7 in return.

You’d set your target ROAS as 700%, as eBags did (successfully) in this Google case study.

Pros

  • Geared towards eCommerce platforms with multiple products – can take the headache out of identifying the right balance between volume sellers and high-margin winners
  • Helps put your ads in front of “buying-ready” audiences

Cons

  • Requires that you feed Google the necessary info (product revenue) to know which keywords are most profitable and will optimize toward the terms that will return the best ROAS
  • Doesn’t work for all websites

Strategy 11: Portfolio Bid Strategies

Now that we know a little more about what Target CPA can do on its own, let’s talk more about what portfolio bid strategies are and why they’re an important piece to the puzzle.

“An automated, goal-driven bid strategy that groups together multiple campaigns, ad groups, and keywords. Portfolio bid strategies automatically set bids to help you reach your performance goals. They include the following Smart bidding strategies: Target CPA, Target ROAS, Maximize conversions, Maximize conversion value, Maximize clicks, and Target impression share.

Once you create a portfolio strategy, it will be stored in your Shared Library. This is the central location for managing your portfolio bid strategies and tracking their performance.

There are two main benefits to implementing portfolio bid strategies:

  1. They can improve the speed of optimizations within a group of campaigns by combining the learnings of all campaigns under the same roof (faster learning period = faster rate of optimization)
  2. They unlock an option for us to layer Max CPC bid limits ON TOP OF Target CPA campaigns and provide an extra layer of control that most advertisers aren’t currently taking advantage of

Pros

  • Eliminates the risk of overspending on any click (you can set a max CPC)
  • Lowers the average CPC immediately which usually correlates in a lower CPA

Cons

  • Impression share drops because you’re purposefully removing yourself from the most expensive auctions

Tips And Tactics For Google Ads Bidding

By now you should be familiar with the different ways you can set up bidding for your Google Ads. it’s time to look at six specific opportunities within the platform that you can use to augment your auction results.

1) Bid Modifiers

Did you know that all devices, days of the week, time of day, and geographic locations perform differently?

Within Google Ads, you can run reports based on those metrics and see where it may make sense to increase or decrease bids depending on performance.

To see device performance, you can segment your campaigns or ad groups and see the individual device performance.

See the difference in cost per conversion?

You might find, for example, that mobile devices are driving conversions at a lower cost. If so, it would make sense to set a 20% positive bid modifier on mobile devices for that specific campaign to get more volume.

However, do note that Smart Bidding strategies are very good at catching this automatically.

To see the day of the week or time of day performance, you can go to Ad Schedule, then look at it by Day & Hour, Day, and Hour.

Here’s how to get to that view.

When looking at this report, you can see if you should not advertise during certain hours of the day because the cost per conversions are too expensive. You might also find that Saturdays and Sundays have lower relative cost per conversion, so you could target those days specifically.

To see geographic performance down to the city level, you’ll want to stay on the Dimensions tab and then View: User locations.

See the difference in performance down at the city level.

You might find that the city of Dallas (for example) is more expensive than Los Angeles when it comes to conversion costs. If that’s the case, you could set a negative bid modifier of 20% for Dallas.

2) Bidding Rules

Google Ads allows you to set certain bidding rules that will pause, enable, and change bids and/or budgets depending on your chosen parameters.

Depending on your tab view within Google Ads, you can set rules at the campaign, ad group, ad, or keyword level.

As an example, you can create a rule to raise bids by a certain percentage if the average cost per conversion is below a certain level. Another rule can raise your bid if the average ad position is low to help you increase conversions.

Here’s an example of what creating a rule looks like.

To create bidding rules, just click the “Automate” button. From there you can select which type of rule you want to put in place.

3) Bidding Scripts

Google Ads scripts allow you to automate your Google Ads activity according to specific time intervals and other available metrics.

Using scripts allows for greater customization beyond regular Google Ads rules, as you can get really creative with what you want to control. Like changing your bids based on weather patterns, for example.

Without getting too technical (or confusing myself) you can dive deeper into the bidding scripts already available, and also see what else might interest you with Google Ads scripts.

4) Bidding For Sales, Not Conversions

A lot of people will look at a Google Ads account and work towards getting more conversions for the sake of conversions.

But that’s wrong.

Are you trying to generate leads or acquire users for your SaaS business? Then it’s extremely important to know that not all keywords are created equal.

If you’re not tracking which keywords are generating sales (again, not just leads), then you’ll treat all PPC traffic as the same with an arbitrary cost per conversion goal.

Some keywords will have a higher sales rate than others.

When that happens, you should be okay bidding more aggressively for those keywords and be okay with a cost per conversion that’s higher than the account average.

This will help you close more deals and achieve more revenue, which should be your ultimate goal anyway.

Depending on the time of year, your Google Ads performance will differ if you’re a seasonal business.

This means that your conversion rates could go down and your cost per conversion could go up.

The opposite could also happen during Christmas time.

If your conversion rates may be much higher than they usually are, you have a reason to bid aggressively and capture as many conversions as possible. But after Christmas, when that performance doesn’t continue, your bids should reflect that change.

Keep this in mind as you’re looking at your account for yearly season trends (inside your Dimensions tab).

6) Different Keywords, Different Offers, Different Margins

Have you ever split tested your landing page offers?

If so, then you know how much of a conversion increase (or decrease) you can expect. And when that happens, your sales/closing rates improve or worsen too.

Like average order values for eCommerce sites, different keywords bring in different margins and dollar values.

It’s important to stay away from a “blanket bid” mentality. Not all keywords should be held to the same bidding goals.

As you keep testing new offers, keep a close eye on what changes (like time to close, and sales/closing rates) after the initial lead is captured.

7) Bid Bumping

Many people start out very conservatively with their bids when launching a new campaign.

But what if you did the opposite?

Bid bumping is a tactic that allows your keywords to maintain a high average position, even after you’ve lowered your bids.

It works by temporarily paying a higher CPC and getting a higher click-through-rate. By then slowly lowering your bids, you can find that your performance stays but your average CPC and conversion cost goes down.

8) RLSA Competitor Bidding

RLSA competitor bidding is one of the 35+ different retargeting campaigns I mentioned in a past post. It allows you to bid more aggressively for searches by visitors who have already been on your site or landing page.

By adding an audience to an existing competitor search campaign, RLSA competitor bidding allows you to add a bid modifier to your keyword bids. You can be much more aggressive and are more likely to convert a past visitor who’s familiar with your brand.

9) Bidding On Branded Keywords

Seems like a no-brainer, right? But bidding on branded keywords does more for you than just being able to control your ad message.

In addition to sending branded visitors to a dedicated landing page (compared to a static homepage), branded keywords can lead to an increase in overall account health and performance improvements for other keywords.

This doesn’t mean that you have to fiddle with changing bids at the branded keyword level. But it should be something you consider, even if you think you’re already getting organic clicks for “free”.

What’s Next

While bidding is important, it’s far from the most effective type of SEM management out there.

With wins from landing page testing and conversion rate optimization, you might find that your problems of bids being too competitive or expensive may disappear.There are more than 21 different Google Ads bidding strategies and options above to choose from. Which one will you test first?

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