AdWords Bidding Strategies For Beginners

AdWords Bidding Strategies For Small Businesses & Beginners

AdWords Bidding Strategies range from simple to complex. This article will make sense of everything a beginner needs to take control of their AdWords bid strategy, simply.

AdWords is about, well, words. You are choosing words that best represent your business so that searchers to find you online, right when they’re looking for something you offer. More specifically, AdWords is about keywords. You may not have guessed just important numbers are to AdWords. In previous articles, we have gone over AdWords account creation, keyword selection, location, budgets and more. Now, let’s discuss AdWords bidding strategies. 

Cost-per-click and bid strategy influence your budget and reach in your AdWords campaigns. You first encounter this seemingly simple but deceptively complex question quickly when signing up for an account: Set Your Bid – meaning what is the most you’re willing to pay for a click on your ad?

Without much to reference, it is a daunting question to face. What bid is too low? Or too high? While Teacup tries to help with AdWords bidding strategies we also want to provide some info so you can confidently begin your bidding.

Why You Should Know AdWords Bidding Strategies?

AdWords is based on an auction. Every time there is ad space open, such as a search result, news site etc, AdWords will run an auction, allowing businesses, like yours, to bid for that spot. i.e. Your bid puts you into the auction for the open ad space. 

Keep in mind, it is not only how much you bid that wins you the auctions but it is also the quality of your ad, relevancy of your keywords to the search, landing page and past performance. So another bidder may bid higher than you but if their overall quality isn’t as high you certainly have a good chance at winning the auction. In the end you usually pay a lower price for bids because only have to pay the amount needed to hold the ad position, which is known as your Actual Cost Per Click. But once you have selected some of your keywords, bidding is really about how much those keywords are worth to you.

If you want your precious brand traffic, you’re going to have to pay for it.  – Aaron Levy

Choosing Automated or Manual Bidding?

Within this question of how much you would like to bid, you’ll need to decide whether you would like to do automatic or manual bidding. Don’t just shrug your shoulders and pick but you can certainly change your AdWords bid strategy later when you explore different campaign types. Your first campaign will be either search only or search with display so the focus will be Cost-Per-Click. Other campaign types have other intents such as impressions, views or conversions. Cost-Per-Click has either the automated or manual bidding choices.

Automated Bidding

Google strongly suggests using their automated option, which is an algorithm to choose what they consider to be optimal bids. You set your budget and AdWords will automatically adjust your bids to get your most clicks as possible within that budget. While being hands-off allows for more ease and efficiency in your time, you still have to track activity on your account. This is especially true for automated changes, and wanting to understand your campaign better. This is also known as Maximized Clicks. Watch out though! This bidding strategy is all science, and no art. Sometimes you end up paying a lot more for clicks than they’re worth. 

Manual Bidding

This option is for those of us who want more control of our AdWords bids. Here you can set various bids, for ad groups, specific keywords and ad placements. You will need a bit more knowledge to begin those other areas of bidding. Manual bidding is great for when you want to really want to put more of your budget in a specific area. While this may sound like the more challenging choice it is actually a great place to start so you can understand your campaign and budget a bit closer. Remember, you know your business, and your customers, far better than anyone else. Including Google!

So How Much Should You Be Bidding In AdWords?

Start small! Beginning this process is about learning comfortably, so you can have a great AdWords experience. We highly recommend starting at a $1, or even less. This will allow low stakes and easy monitoring, and you can always increase your bid. It’s good not to get caught up too quickly and overspend. Start to explore which keywords work and you will start to figure out the optimal bidding strategy for your business needs. A good starting point though is a look at Google’s Keyword Planner. You’ll find help here when it comes to budget friendly keywords. 

Even once you get to the point of trying higher bids, Google isn’t going to try to take your money if the bid below you is much lower. In the end, if your win the auction, they only charge you 1 cent more than the bid below yours. Say you feel really great about a bid and you price it at $5. The business below you prices at $1. You definitely wouldn’t want to pay that extra $4! Thankfully Google would only charge you $1.01 for your ad.

And yes, for certain industries bids can very extremely high.

AdWords Bidding Strategies

Finding the best AdWords bidding strategies will come over time as you learn the AdWords platform. But before your start looking at technical strategies think of your business individually. Know your goals that your want to reach with using AdWords, and even when it comes to the kind of bidding your choose to do.  To focuse on getting more traffic and clicks you would of course pick CPC Bidding.  If generating more awareness of your business matters, you could choose an Impressions strategy or vCPM (cost per thousand viewable impressions). Or, if you have videos you want more people to view you would go with a cost-per-view (CPV) bidding strategy.

As you go about creating your strategy here are few tips to be mindful of:

  • Conversion Tracking: If you want to know if your ads are leading to conversions set up conversion tracking on your AdWords account. 
  • Quality Score: Always take steps to improve your quality score. This will help with winning at the auction.
  • Small Changes: Always make any changes in AdWords in small bites. As you make these changes you will know where your weak and strong points are as well as what are actually changes in the marketplace.
  • Landing Page: Don’t forget about continuously improving your landing pages as well, they are important to get action towards your business goals.

 

 

AdWords Bidding Strategies For The Win

Sometimes, keywords get competitive. The first page and the top spot are coveted. Here are a few ways to help you get into to those valuable ad positions and keep your ad rank high. These top positions are not necessary to be successful in AdWords but they can be good goals to aim for, if you get there cost-efficiently.

Bidding For The First Page

How often do you go past the first page in a search result? Rarely, right? Even scrolling all the way to the bottom of the first page might be quite a distance for a lot of us. With that in mind we all know that getting an ad on the top of that first page is quite valuable. If your bids are not already getting your ads to the first page, Google will give you some strong hints to raise your bids. This could also be because your Quality Score is just not cutting it. Your options are to improve your Quality Score or bid more. 

Once you are already navigating through AdWords, take a look at the estimates in the Keywords tab > Columns > Attributes. You’ll find Google’s suggested bid raise here. However, before raising your bid, you should check to see if your quality score is below 6. While 6 is average, the higher you get your quality score, the cheaper that raise will be to get you to the first page.

Bidding For The Top Spot

Like a spot on the first page, there is also an estimate in the AdWords platform for the first position. Which is nice and useful. Again, be mindful of your quality score; Ad relevance, Landing page experience and CTR. But you should really be looking at your Cost Per Acquisition (CPA) and conversions rates first. This is because these two metrics determine whether it’s even worth chasing this top spot at all.

The higher your ad rank number the better. Being in the top, first position or page may be extremely desirable, but being in position 2 or 3 can prove to have very similar conversion rates for lower cost. So don’t be discouraged by these positions and continue to optimize these important metrics to keep yourself in a healthy ad position.

AdWords Bidding Strategies for Single Keyword Ad Groups

If you use Single Keyword Ad Groups (SKAG) you’ll need to bid a little differently. Using a SKAG is a great way to keep your campaign organized, cost efficient and highly relevant to searches. The exact match improves Click Through Rate (CTR), due to higher relevancy. The Broad and Phrase matches provide a higher number of impressions and offer great keyword discovery for a low cost. Higher CTR often means higher Quality Score. Having both quality score and CTR doing well means your ad position becomes healthier. Furthermore, if you keep this up you may be able to bid lower or have a lower CPC. This means your Cost Per Conversion (CPA) is lower as well. Ding Ding Ding!

 

Bid at the keyword level here, not the ad group. Bid enough to get your exact match to the first page. Then, bid about 25% lower on the phrase match. The broad match keyword gets the lowest bid at about 50% less than your exact match.

For example:

Exact Match: [wedding videographer] – Bid: $2
Phrase Match: “wedding videographer” – Bid: $1.50
Broad Match:  +wedding +videographer – Bid: $1

The result is:

[wedding videographer] – bidding the most, because you’re highly relevant.
price for a “wedding videographer” – Bidding lower but competitively for a search that will usually be relevant
+videographer for my +wedding – Bidding lowest because this is relevant for a broad range of searches. Some searches will be relevant while others not at all.

Stay In Control Of AdWords Bidding Strategies

AdWords is obviously a puzzle of words and phrases, putting the right ones together to created a desirable picture for the whole internet, or at least your little corner of it. You will still need to think about numbers but bidding can be done successfully if you patiently take it slow and keep your business goals in mind. You could also let us at Teacup handle the hard part and make sure you get results quicker. We don’t want you to spend a whole lot of time or money. Let us do your bidding 😉

 

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