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Should you use Maximize Conversions or Manual CPC bidding in Google Ads?

bidding episode 1 Feb 02, 2024
Should you use Maximize Conversions or Manual CPC bidding in Google Ads?

In most situations, you should use Maximize Conversions bid strategy over Manual CPC.

Why should you care about my opinion? I'm Jyll Saskin Gales, and I bring you more than a decade of Google Ads experience. I worked at Google for six years and now I'm a Google Ads coach, consultant, teacher, content creator, speaker, author and podcast host. I've worked with more than 10,000 Google Ads accounts, showing business owners and marketers how to make more money from paid ads, and now I'm here to do the same for you right here, right now.

What is Manual CPC in Google Ads?

A Manual CPC bid strategy means that you as an advertiser are telling Google the maximum amount you're willing to pay per click.

Say that my CPC bid for keyword one is $3 and keyword two is $2. That tells Google I'm only willing to pay up to $3 per click on the first one and up to $2 per click on the second one. And remember, Google Ads works like an auction. So just as if you are bidding on an item on eBay, it doesn't mean you're going to have to pay $3, necessarily. It just means that that's the maximum amount you're willing to pay. And if other people bid, too, you're willing to go up to $3. But if the next bid hits $3.10, you lose. You're not willing to play anymore.

I don't recommend doing that - Manual CPC bidding - in most circumstances. I recommend Maximize Conversions as a great starting point for most campaigns.

 

What is Smart Bidding in Google Ads?

That's because Maximize Conversions is a Smart Bidding strategy, and that means that the Google Ads system is taking millions of signals into account. Not just the keyword, which is all you can really optimize for if you're manually bidding, but signals like what Google knows about the user, what device they’re on, the time of day, their internet browsing history, millions of things like that. And based on all of that, it's determining the best bid for every keyword, for every user, in every auction.

 

Lower CPCs are not always better

Something else to keep in mind is lower CPCs doesn't always mean better, because it's an auction. And so just like in an auction, the more desirable something is, the more expensive it is. Getting the cheapest clicks may bring you the cheapest, lowest quality traffic, which isn't necessarily a good thing, especially if what you're selling, you're making $50 or $100. Shouldn't you be willing to pay maybe $5 or $7 or $10 per click?

In the insurance industry, for example, CPCs can go as high as $100 or $150. Just for a click! I know that would be crazy for most businesses, but in an industry like that where they make thousands of dollars every single year from expensive insurance policies, it makes sense.

 

Exceptions: when Maximize Conversions may not be the best bid strategy for you

If you have no conversions yet in your account, you could choose to start with Maximize Clicks, let the system learn a little bit, and then move on to Maximize Conversions. Maximize Clicks is not a Smart Bidding strategy.

If you have a very, very low budget, and I would define that as less than $20 per day per campaign. Maybe you shouldn't advertise in the first place, but if that's the case - you have a super small budget - then one of these maximize bid strategies may not be the best choice for you. In that circumstance you may want to start with Manual CPC.

If you have a brand campaign and you want to advertise to people searching for your brand, that could potentially get quite expensive on Max Clicks or Maximize Conversions depending on if other people are bidding on your brand as well, so you may want to run that on Manual CPC. However, most clients I work with see a lot of success putting their brand campaigns on Maximize Conversions.

If you are running a competitor campaign, where you’re advertising when someone is searching for a competitor's name, that could be another situation where you may want to start on Manual CPC.

But for the most part, I recommend running campaigns on a Maximize Conversions bid strategy.

 

How to set a maximum CPC bid limit with Smart Bidding in Google Ads

Here’s an advanced tip I'll share with you. If you want a workaround to be able to use a Smart Bidding strategy, but also set a Max CPC, kind of have the best of both worlds, you can't do that within the campaign’s settings, itself, but you can do that by setting up what's called a Portfolio Bid Strategy.

You can do that by going to the Tools section of Google Ads, choose a Portfolio Bid Strategy, which is intended to put multiple campaigns under a shared Bid Strategy, and then add a Maximum CPC bid limit to that.

Again, I don't generally recommend doing this, but if you're someone who wants a little of column A and a little of column B, help yourself to that.

So in conclusion, Zach, thanks for your question. Do I recommend running campaigns with a Maximize Conversions bid strategy or a fixed CPC? The answer in the vast majority of use cases is I recommend Maximize Conversions.

 

This is an excerpt from the Inside Google Ads podcast, Episode 1. Subscribe to the Inside Google Ads podcast wherever you listen to podcasts to get more practical advice based on real-world experience with Google Ads accounts. Whether you're a novice or an experienced advertiser, tune in for valuable PPC tips that can transform your advertising approach and maximize your campaigns' success.


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