bid strategy

Consider your goals   :

Each bid strategy is suited for different kinds of campaigns and advertising goals. For the purposes of bidding, you'll want to consider three basic types of goals, along with your current campaign settings.

·        If you want to generate traffic to your website, focusing on clicks could be ideal for you. Cost-per-click (CPC) bidding may be right for your campaign.

·        If you want to increase brand awareness—not drive traffic to your site—focusing on impressions may be your strategy. You can use cost per thousand viewable impressions (vCPM) bidding to put your message in front of customers.

·        If you want customers to take a direct action on your site, and you're using conversion tracking, then it may be best to focus on conversions. Cost-per-acquisition (CPA) bidding lets you do that.

(1)Focus on clicks with CPC bidding

If you're focusing on gaining clicks to generate traffic to your website, there are two cost-per-click bid strategies to consider:

(a)Maximize Clicks is an automated bid strategy. It's the simplest way to bid for clicks. All you have to do is set a daily budget, and the AdWords system automatically manages your bids to bring you the most clicks possible within your budget.

Maximize Clicks could be a good option for you if the following describes your campaign:

·        You have an advertising budget you'd like to reach consistently.

·        You don't want to spend time monitoring and updating individual cost-per-click (CPC) bids, and you're willing to let the AdWords system update CPC bids automatically.

·        You're mainly interested in increasing website traffic.

·        You're new to AdWords or don't know exactly how much to bid for particular keywords or placements.

Maximize Clicks isn't a good choice for you if your advertising goals include maintaining a specific ad position or cost per conversion. It isn't possible to set individual CPC bids with Maximize Clicks, but you can set a maximum CPC bid for your entire campaign.

Example

You have a website that sells a variety of art supplies, and your main goal is to bring more customers to your site. You have a set amount that you want to spend on advertising each month, and there isn't a particular product you want to emphasize most. Maximize Clicks lets you decide the overall amount of your budget, then we'll find you the most customers based on that.

(b)Manual CPC bidding lets you manage your maximum CPC bids yourself. You can set different bids for each ad group in your campaign, or for individual keywords or placements. If you've found that certain keywords or placements are more profitable, you can use manual bidding to allocate more of your advertising budget to those keywords or placements.

More about Manual CPC bidding

With Manual CPC bidding, you can fine-tune your maximum CPC bids to help control the cost and volume of clicks on your ads. Manual CPC bidding could be a good choice for you if your campaign fits this description:

·        You'd like to control maximum CPC bids for individual ad groups, keywords, or placements.

·        You're mainly interested in increasing website traffic, not necessarily brand awareness.

·        You don't need to reach a target budget every month. (If you do need to reach a target budget, Maximize Clicks may be a better choice.)

·        Your campaign targets the Search Network, the Display Network, or both.

If you're not sure which keywords or placements are most profitable, or if you don't have time to devote to managing manual bids, Maximize Clicks is probably a better fit for you.

Example

Although your website sells a wide range of art supplies, you're most interested in selling paint brushes. With Manual CPC bidding, even if your ad group has 15 keywords, you can choose to set a higher bid for only the keyword "paint brushes," which will apply whenever that keyword triggers your ad.

(2)Focus on impressions with manual vCPM bidding

Manual bidding for viewable impressions, also known as vCPM bidding, lets you control the visibility of your ads by fine-tuning your maximum vCPM bids.

Here are some cases in which we'd recommend manual vCPM bidding:

·        Your ads are designed to increase awareness, but not necessarily generate clicks or traffic.

·        You prefer the traditional industry metrics of vCPM (cost-per-thousand viewable impressions) campaigns.

·        You're targeting particular placements, not just keywords. (Combined with placement targeting, bidding for impressions can help ensure your ads appear to a specific audience that will be interested in your ads.)

·        You're mainly interested in increasing brand awareness. Image ads and other multimedia formats often serve that purpose best, and these ad formats run on the Display Network.

·        Your message is in the ad itself, so you don't need people to click through to your site. This may apply to events (such as a television premiere) or political advertising.

Manual vCPM bidding probably isn't for you if the goal of your campaign is a direct response from customers, like buying a product or filling out a form.

Example

You're giving a free concert in Paris, and want to get as many music lovers to come as possible. You're running a campaign with vibrant image ads that share the date, time, and location of the event -- everything a music fan needs to know to show up. As long as people see your ad, they'll know your whole message. Viewable CPM bidding can help you get it in front of as many eyes as possible.

(3)Focus on conversions with Target CPA bidding

Target CPA (cost-per-acquisition) bidding is an advanced option that lets you bid directly for conversions.

Your campaign must meet a few requirements in order to be eligible for Target CPA bidding:

·        You have conversion tracking enabled.

·        Your campaign targets the Search Network, the Display Network, or both.

We also recommend your account meet these criteria:

·        Your campaign is direct-response oriented. For example, the campaign focuses on generating sign-ups or sales on an e-commerce website.

·        Your campaign has a single well-defined conversion type, such as a completed purchase or sign-up.

·        Your campaign has a relatively stable conversion rate, with no major changes (such as redefining the conversion event or moving the conversion tracking code) within the last 2 weeks.

·        For best performance, your campaign should receive at least 50 conversions per month. AdWords relies on historical conversion data, so the longer conversion tracking has been running, the more data the system has, and the better job it can do optimizing your return on investment (ROI).

About return on investment (ROI):

Whether you use AdWords to increase sales, generate leads, or drive other valuable customer activity, it's a good idea to measure your return on investment (ROI). Knowing your ROI helps you evaluate whether the money you're spending on AdWords advertising is going to a good cause: healthy profits for your business.

How ROI Works

ROI is the ratio of your net profit to your costs. It's typically the most important measurement for an advertiser because it's based on your specific advertising goals and shows the real effect your advertising efforts have on your business. The exact method you use to calculate ROI depends upon the goals of your campaign.

One way to define ROI is:

    (Revenue - Cost of goods sold) / Cost of goods sold

Let's say you have a product that costs $100 to produce, and sells for $200. You sell 6 of these products as a result of advertising them on AdWords, so your total cost is $600 and your total sales is $1200. Let's say your AdWords costs are $200, for a total cost of $800. Your ROI is:

    ($1200 - $800) / $800

    = $400 / $800

    = 50%

In this example, you're earning a 50% return on investment. For every $1 you spend, you get $1.50 back.

For physical products, the cost of goods sold is equal to the manufacturing cost of all the items you sold plus your advertising costs, and your revenue is how much you made from selling those products. The amount you spend for each sale is known as cost per conversion.

If your business generates leads, the cost of goods sold is just your advertising costs, and your revenue is the amount you make on a typical lead. For example, if you typically make 1 sale for every 10 leads, and your typical sale is $20, then each lead generates $2 in revenue on average. The amount it costs you to get a lead is known as cost per acquisition.

Why ROI matters

By calculating your ROI, you can find out how much money you've made by advertising with AdWords. You can also use ROI to help you decide how to spend your budget. For example, if you find that a certain campaign is generating a higher ROI than others, you can apply more of your budget to the successful campaign and less money to campaigns that aren't performing well. You can also use ROI data to try improve the performance of the less successful campaigns.

Use conversions to measure ROI

To identify your ROI, you first need to measure conversions, which are customer actions that you believe are valuable, such as purchases, signups, web page visits, or leads. In AdWords, you can use the free conversion tracking tool to help track how many clicks lead to conversions. Conversion tracking can also help you determine the profitability of a keyword or ad, and track conversion rates and costs-per-conversion.

Tip

Many AdWords advertisers use Google Analytics to track conversions. It's a free web analytics tool that helps you learn how your customers interact with your website. Learn more about importing conversions from Google Analytics..

Once you've started to measure conversions, you can begin to evaluate your ROI. The value of each conversion should be greater than the amount you spent to get the conversion. For example, if you spend $10 on clicks to get a sale, and receive $15 for that sale, you've made money ($5) and received a good return on your AdWords investment.

 

 

Return on investment (ROI)

How much profit you've made from your ads compared to how much you've spent on those ads.

To calculate ROI, take the revenue that resulted from your ads, subtract your overall costs, then divide by your overall costs: ROI = (Revenue - Cost of goods sold) / Cost of goods sold.

Example

Let's say you have a product that costs $100 to produce, and sells for $200. You sell 6 of these products as a result of advertising them on AdWords. Your total sales are $1200, and your AdWords costs are $200. Your ROI is ($1200-($600+$200))/($600+$200), or 50%.

To help measure your AdWords ROI, you'll need to track conversions, actions that you want your customers to take on your website after clicking your ad such as a purchase, sign-up, or download. Try conversion tracking or Google Analytics, free tools to help you track conversions in your account.

ROI is typically the most important measurement for advertisers because it shows the real effect that AdWords has on your business. While it's helpful to know the number of clicks and impressions you get, it's even better to know how your ads are contributing to the success of your business.

 

 

 

About conversion tracking

Conversion tracking is a free tool that shows you what happens after a customer clicks on your ads -- whether they purchased a product, signed up for your newsletter, called your business, or downloaded your app. When a customer completes an action that you've defined as valuable, these customer actions are called conversions.

Why use conversion tracking

·        See which keywords, ads, ad groups, and campaigns are best at driving valuable customer activity.

·        Understand your return on investment (ROI) and make better informed decisions about your ad spend.

·        Use flexible bid strategies (such as target CPA, enhanced CPC, and target ROAS) that automatically optimize your campaigns according to your business goals.

·        See how many customers may be interacting with your ads on one device or browser and converting on another. You can view cross-device, cross-browser, and other conversion data in your “All conversions” reporting column.

How conversion tracking works

Conversion tracking starts with you creating a conversion action in your AdWords account. A conversion action is a specific customer activity that is valuable to your business. You can use conversion tracking for these sources:

·        Website actions: Purchases, sign-ups, and other actions that customers complete on your website.

·        Phone calls: Calls directly from your ads, calls to a phone number on your website, and clicks on a phone number on your mobile website.

·        App downloads and in-app actions: Downloads of your Android or iOS mobile apps, and purchases or other activity within those apps.

·        Import: Customer activity that begins online but finishes offline, such as when a customer clicks an ad and submits a contact form online, and later signs a contract in your office.

The conversion tracking process works a little differently for each conversion source, but for each type besides offline conversions, it tends to fall into one of these categories:

·        You add a conversion tracking tag, or code snippet, to your website or mobile app code. When a customer clicks on your ad from Google Search or selected Google Display Network sites, a temporary cookie is placed on their computer or mobile device. When they complete the action you defined, our system recognizes the cookie (through the code snippet you added), and we record a conversion.

·        Some kinds of conversion tracking don’t require a tag. For example, to track phone calls from call extensions or call-only ads, you use a Google forwarding number to track when the call came from one of your ads, and to track details like call duration, call start and end time, and caller area code. Also, app downloads from Google Play will automatically be recorded as conversions, and no tracking code is needed.

Counting conversions

There are two important conversion tracking metrics: conversions and converted clicks. You can view both metrics in your conversion tracking reports.

·        Conversions
For each conversion action, you can choose to count every or one conversion after each click. The "Conversions" column of your reports will display conversions within your chosen conversion window, according to your selected counting method. The "Every" setting is useful for counting every instance of sales, while "One" is used to count only one conversion when the same person generates multiple leads (Example: one person fills out 2 different forms requesting to be contacted about different services you offer.)

·        Converted clicks
The "Converted clicks" column shows you the number of AdWords ad clicks resulting in one or more conversions within your chosen conversion window. Note that the converted clicks count doesn't reflect the relative value of each converting click. Clicks that lead to high-value conversions (such as multiple purchases) aren’t distinguished from those that lead to low-value conversions (such as a single newsletter sign-up). Also, you can't segment the "Converted clicks" column by conversion name, source, or category, because each ad click can lead to multiple conversions. If you were to segment by conversion name, some converted clicks could be counted more than once, and your segmented converted clicks would add up to more than the total.

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Written by OM MAURYA SIR

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