How to Determine a Bidding Strategy for Different Types of Ads
When I first learned to ride a bike, I remember being scared. It was a daunting process because I had never done it before and was scared of falling.
I remember feeling similarly when I started running paid advertising campaigns at the marketing agency I worked for. Doing something for the first time can be an intimidating process.
However, as a marketer, understanding how to set up your paid advertising campaigns is important so that you can get the most out of your budget.
You can do this by using different types of bid strategies for different types of ads.
Below, let’s review the bid strategies that produce results when using Facebook ads and PPC / Google ads.
Facebook ad bid strategy
If you are just starting out with Facebook Ads, figuring out which strategy to use is not easy.
Fortunately, Facebook has a guide that explains the different bid strategies you can use. Let’s dive into these strategies and see how to determine which one is right for you.
1.Lowest Cost (Auto Bid)
With this strategy, you don’t have a lot of manual work to do. In fact, Facebook is the one that automatically creates the bid.
If you’re looking to spend your entire budget, this is a great choice for you. It’s a hands-off strategy, and you can get more bang for your buck while on your budget.
How do you know if this is a strategy you want to implement? This is a good idea if the goal of your campaign is brand awareness, impressions, traffic, post engagement, or lead generation.
2. Bid cap
This strategy is slightly different due to the manual processes. In this case, you are the one making the bid.
This is a good option when you want more control over costs. In fact, you may not even be spending your entire budget on this strategy.
This type of strategy works for the same types of ads as the lowest cost strategy. It’s just more manual and gives you more control over your spending. In addition, you can use it to increase your competitiveness compared to other advertisers.
3. Upper cost limit
If the goal of your ads is traffic, event responses, offsite conversions, or lead generation, this is a great option too.
With this strategy, Facebook sets the bid while you determine the maximum amount you are willing to spend.
You can use this type of bid strategy when you want to maximize cost efficiency and keep costs within a certain threshold.
4. Target costs
This strategy is another semi-automatic option that allows Facebook to select the bid while you set a target price. This is the price you want to be aiming for, but Facebook could easily be over-spending or under-spending.
If you want to keep costs constant, this is a good strategy. You can predict your costs and get the best possible conversions on your target costs.
However, it is important to keep in mind that you could lose other cheaper options.
This is a good strategy if your ad is targeting traffic, lead gen, or conversions.
5. Value optimization with minimal return on ad spend (ROAS)
If you set your goals for app installs, conversions, or catalog sales, this is an interesting bid strategy.
With this strategy, Facebook sets the bid that is specific to value optimization. If you are using ROAS as your primary success metric, this is a good option.
This bid strategy focuses the campaign on the bottom line so you get the most opportunities while maintaining minimal ROAS.
6. Highest value
If you want to spend your entire budget and get the highest ROAS, this is a good bid strategy.
It’s handy, which means Facebook is managing the bidding. You can spend your budget while getting the most valuable results.
This is a good strategy if your ad is targeting app installs, conversions, or catalog sales.
Now that we’ve learned more about Facebook ad bid strategies, let’s dive into strategies that you can use with pay-per-click (PPC) ads, whether it’s done through Google or another search engine.
Google Ads / PPC bid strategy
Much like Facebook ads, getting started with PPC ads can be a difficult task if you’ve never done it before.
Before reviewing the Google bid strategy options, it is important to understand how to create a campaign.
In the following video, HubSpot Academy shows you how to create your first Google Ads campaign and how the Google Ads auction system works.
Now let’s dive into the options Google has for bid strategies.
1. Manual cost per click (CPC)
Similar to the manual strategies for Facebook, this is a good strategy for you if you want more control over costs and spending.
With the manual CPC, you choose the price you want to pay for each click. Then Google will make sure you never spend more than that amount on a click.
2. Target cost per acquisition (CPA)
This strategy can help you set a target CPA that will let Google know how much you want to spend on creating an action.
According to Google, “Target determines CPA bids based on historical information about your campaign and the analysis of the context signals available at auction time automatically an optimal bid for your ad every time it is eligible to display. Google Ads sets these bids at an average CPA Achieve Corresponds to your goal in all campaigns using this strategy. “
With this setting, you’ll pay for conversions rather than clicks.
3. Goal ROAS
Similar to the ROAS strategy for Facebook, PPC ads also allow you to specify how much you want to get back from your ad spend.
This is a great strategy if you want to get more conversion value on a ROAS goal you set yourself.
4. Maximize the clicks
Sometimes when you’re setting up a PPC campaign, all that interests you is maximizing your clicks.
In that case, you can use this strategy to have Google automatically adjust your campaign to get the most clicks.
This is the easiest and easiest way to bid for clicks. All you have to do is set your average daily budget and Google will do the rest.
5. Maximize conversions
If conversions are the main metric you use for success, consider a strategy for maximizing conversions.
With this strategy, Google focuses on optimizing your bid strategy to get conversions.
This is a good strategy if you want to spend your entire budget while getting the best conversions possible.
6. Location of the destination search page
If you want your ad to appear in a specific spot on the search engine’s search results page, this is a good strategy.
Google tweaks your bid strategy so that your ad appears in a specific location.
7. Target outranking percentage
This type of strategy allows you to choose how often you want to outperform your competitors on Google.
This is a good strategy if your focus is on making your ads more competitive.
8. Improved CPC
This strategy allows you to automatically adjust your manual bids to maximize conversions.
This is just an expanded version of the manual CPC strategy. Testing CPC ads is a great strategy to learn more.
Ultimately, you should experiment and find out which strategies will work for your business. Even if you are running an automated bid strategy, it should be carefully monitored and the results monitored.