The Ultimate Guide to Google Ads Bid Strategies

By: Jyll Saskin Gales, Google Ads Coach

Are you feeling overwhelmed by the sheer number of bid strategies in Google Ads? Do you find yourself scratching your head, wondering which one is the right fit for your campaigns? Let's clear that up for you right now. Google Ads offers a variety of bidding options, and choosing the right one can significantly impact your campaign's performance.

My goal is to provide you with a clear, concise guide to every bid strategy available in Google Ads. I'll help you understand the purpose of each strategy so you can confidently pick the best one for your goals, every time.

Here's what we'll cover:

• The four main categories of Google Ads bid strategies: Impression-based, click-based, view-based, and conversion-based (also known as smart bidding).

• A detailed breakdown of each bid strategy: Understanding how they work and what they optimize for.

  • Smart Bidding strategies
    • Maximize Conversions
    • Target CPA
    • Maximize Conversion Value
    • Target ROAS
  • Click-based bid strategies
    • Maximize Clicks
    • Target CPC
    • Manual CPC
  • View-Based bid strategies (for Video Campaigns)
    
    • What is a view in Google Ads?
    • Target CPV
    • Maximum CPV
  •  Impression-Based bid strategies
    • Target CPM
    • Viewable CPM
    • Target Impression Share

• Practical advice: When to use each bid strategy to achieve your desired results.

Understanding Google Ads Bid Strategies: A Comprehensive Guide

Google Ads bid strategies can be broadly categorized into four types, each designed to optimize for a specific outcome:

• Conversion-Based (Smart Bidding): Focuses on actions users take on your site, like purchases or form submissions.

• Click-Based: Aims to drive website traffic.

• View-Based: Designed for video campaigns, focusing on user engagement with your video ads.

• Impression-Based: Prioritizes visibility and reach.

Let's dive into each category to understand their nuances.

Conversion-Based Bid Strategies, aka Smart Bidding

Smart Bidding strategies are usually your best bet because they focus on getting users to do something valuable, like making a purchase, filling out a form, or calling your business. These bid strategies leverage Google's machine learning to optimize bids at auction time, considering a multitude of signals to find the right users for your business.

Here are the four smart bidding strategies:

1. Maximize Conversions

   • Goal: To get you the most conversions possible within your budget.

   • How it works: Google automatically sets bids for you to maximize your conversions, taking into account various contextual signals at the time of the auction. Even though it optimizes for conversions, you still pay per click.

   • Compatibility: Search, Display, Demand Gen, and Performance Max campaigns.

   • When to use: This is an excellent starting point for new campaigns or when you want to get as many conversions as possible without a strict cost per conversion target.

2. Target CPA

   • Goal: To get you as many conversions as possible at a specific average cost per conversion (your "target CPA").

   • How it works: You tell Google your desired CPA, and it adjusts bids to try and achieve that average. Unlike "maximize" strategies, "target" strategies prioritize efficiency. If Google can't hit your target, it might not spend your full budget.

   • Compatibility: Search, Display, Demand Gen, Performance Max, and App campaigns (where it's called Cost Per Install or Cost Per In-App Action).

   • A note on device bid adjustments: If you set a device bid adjustment with Target CPA, it won't directly lower your bids. Instead, it will lower your target CPA for that device. Just trust me - don't try a bid adjustments.

   • Pay Per Conversion (Display Campaigns Only): In some Display campaigns, you might see an option to "Pay Per Conversion," meaning you only pay when a conversion happens. However, this has strict eligibility requirements and is rarely available.

3. Maximize Conversion Value

   • Goal: To spend your budget to get you the highest total conversion value possible.

   • How it works: This strategy is ideal when your conversions have different monetary values (e.g., selling items that cost $10, $100, or $1,000). Google optimizes for the total revenue generated, rather than just the number of conversions.

   • Compatibility: Search, Display, Demand Gen, and Performance Max campaigns.

   • When to use: Best for ecommerce businesses or those with varying conversion values.

4. Target ROAS 

   • Goal: To get you as much conversion value as possible at a specific return on ad spend or ROAS (calculated as conversion value divided by cost).

   • How it works: You set a target ROAS (e.g., 150%, meaning you want $1.50 back for every $1 spent on ads). Google will adjust bids to try to achieve that average return. Like Target CPA, this strategy prioritizes efficiency.

   • Compatibility: Search, Shopping, Display, Demand Gen, Performance Max, and App campaigns.

   • When to use: Crucial for ecommerce or any business where conversion value is measurable and you need to ensure profitability. This strategy requires sufficient conversion data to learn effectively.

Click-Based Bid Strategies

When your primary goal is to drive traffic to your website, or you can't track conversions for some reason, these strategies come into play.

1. Maximize Clicks

   • Goal: To get you as many clicks as possible within your budget.

   • How it works: Google automatically sets bids to maximize clicks on your ads. While automated, it's not a "smart" bidding strategy as it doesn't consider the same depth of signals as conversion-focused strategies.

   • Compatibility: Search, Shopping, Display, and Demand Gen campaigns.

   • When to use: Ideal when you're focused purely on increasing website visits and not necessarily on immediate conversions.

2. Target CPC

   • Goal: To get you as many clicks as possible at a specific average cost per click.

   • How it works: You set a target CPC, and Google aims to average out to that cost per click over time. This is a relatively new strategy that focuses on efficiency (cost per click) rather than volume of clicks.

   • Compatibility: Demand Gen campaigns only.

   • When to use: If you have a specific budget for clicks and want to maintain a consistent average cost.

3. Manual CPC

   • Goal: To give you full control over your bids.

   • How it works: You manually set the maximum amount you're willing to pay per click. Google will not bid higher than your specified amount. It's a hands-on approach with no automation.

   • Compatibility: Search, Shopping, or Display campaigns.

   • When to use: When you want precise control over your bids and are comfortable with the manual effort involved.

View-Based Strategies (for Video Campaigns)

These strategies are specifically for video campaigns where the goal is engagement and views. Understanding what constitutes a "view" in Google Ads is important, as it varies based on the ad placement.

What is a view in Google Ads?

• In-stream ad: 30 seconds watched, or the end of the ad, or an interaction (whichever comes first).

• In-feed placement: User clicks thumbnail, or watches autoplay for at least 10 seconds, or to the end (whichever comes first).

• Shorts ad: 10 seconds watched, or the end of the ad, or a click on the call to action (whichever comes first).

Now, for the strategies:

1. Target CPV

   • Goal: To get as many views as possible at a specific average cost per view.

   • How it works: You set your desired average cost per view, and Google optimizes to achieve that average. This is an automated strategy where you pay per view, not per click.

   • Compatibility: Video views subtype of Video campaigns.

   • When to use: The most common strategy for video campaigns focused on getting views and engagement.

2. Maximum CPV

   • Goal: To give you manual control over the maximum amount you're willing to pay per view.

   • How it works: You set the highest amount you'll pay for a view. This is a manual bidding strategy.

   • Compatibility: Only available in video campaigns for ad sequence (meaning it's rarely used).

   • When to use: Extremely niche scenarios where you need very tight control over individual view costs in specific video campaign formats.

Impression-Based Bid Strategies

When your objective is awareness, visibility, or reach, these strategies are your best bet. We measure the value of impressions using CPM (Cost Per Mille), which means cost per thousand impressions.

1. Target CPM

   • Goal: To get as many impressions as possible at a specific average cost per thousand impressions.

   • How it works: You set a target CPM, and Google aims to average out to that cost. You pay for impressions (when your ad is shown). This strategy optimizes for unique reach, aiming to show your ads to as many different people as possible.

   • Compatibility: Reach-focused Video campaigns.

   • When to use: When your primary goal is brand awareness and maximizing the number of unique viewers for your video campaigns.

2. Viewable CPM

   • Goal: To maximize viewable impressions at a specific cost.

   • How it works: You set the maximum amount you're willing to pay for a thousand viewable impressions. An ad is counted as viewable when 50% of it is on screen for at least one second. This is a manual bidding strategy.

   • Compatibility: Display campaigns.

   • When to use: For Display campaigns where you want to ensure your ads are actually seen by users.

3. Target Impression Share

   • Goal: To achieve a specific visibility for your ads in Google Search results.

   • How it works: You bid for visibility, choosing whether you want to appear at the absolute top of the page, anywhere at the top, or anywhere on the page. Even though it's impression-based, you still pay per click in search campaigns.

   • Compatibility: Search campaigns (Google Search only, not search partners).

   • When to use: When brand visibility and occupying a prominent position in search results is crucial. Be aware that aiming for a high impression share can increase your costs.

Which Bid Strategy Should You Choose?

Now for the million-dollar question! While the "best" strategy depends on your specific goals, here's a simplified guide:

• For Search, Display, Demand Gen, or Performance Max:

  • Start with: Maximize Conversions. This helps you gather initial conversion data.

  • Aim for: Target CPA or Target ROAS as soon as you have enough conversion data, usually 30 conversions in 30 days for Target CPA and 50 conversions in 30 days for Target ROAS. These "target" strategies allow you to scale your campaigns profitably by focusing on efficiency. Think of "maximize" as a stepping stone to "target" strategies.

• For Shopping Campaigns:

  • Start with: Maximize Clicks or Manual CPC.

  • Aim for: Target ROAS as quickly as possible. Since shopping campaigns are often directly tied to sales, optimizing for return on ad spend is key.

• For Video Campaigns:

  • You'll almost always opt for a video views campaign, which means using Target CPV bidding. If your goal is pure reach, then Target CPM is your friend.

By understanding these strategies and their optimal use cases, you'll be well-equipped to make informed decisions that drive better results for your Google Ads campaigns.