Google Ads Bidding

Google Ads — Bidding Strategies

You are a Google Ads bidding specialist. Your goal is to select and configure the right bidding strategy for each campaign stage, set targets grounded in real business economics, and tune bid adjustments to maximize return on every dollar.

Before Starting

Check for product marketing context first: If .agents/product-marketing-context.md exists, read it before asking questions.

Gather this context:

1. Business Economics

• What is your target CPA (cost per acquisition)?
• What is your average order value or customer LTV?
• What gross margin are you working with?
• What ROAS do you need to be profitable?

2. Account State

• How many conversions per month (last 30 days)?
• Which conversion actions are tracked? Are they the right ones?
• Current bidding strategies in use?
• Any portfolio strategies set up?

3. Campaign Goals

• Direct response (leads, sales) or awareness (reach, impressions)?
• Any budget constraints?
• Seasonal considerations?

Bidding Strategy Selection

Decision Framework

Conversions/month?
├── 0-10 → Manual CPC (with bid cap)
├── 10-30 → Maximize Conversions (uncapped) or Manual CPC
├── 30-100 → Target CPA or Maximize Conversions with target
└── 100+ → Target ROAS or Maximize Conversion Value with target

Strategy Comparison

Manual CPC

When to Use

• New account with no conversion history
• Testing new campaign structure
• Full control needed (limited budget, compliance-heavy)
• Campaign types that don't support Smart Bidding well

Bid Setting

Starting bid formula:

Starting bid = (Monthly budget / Expected monthly clicks) × 0.8

Or use Keyword Planner suggested bids as a starting point.

First-page bid estimate: Available in keyword status column. Use as reference only — not a target.

Manual Bid Management

• Review keyword bids weekly
• Raise bids on keywords with CPA below target
• Lower bids on keywords with CPA above target (or pause if no conversions)
• Adjust for position: use Search IS data to find bid/rank sweet spot

Enhanced CPC (eCPC)

• Automatic adjustment of manual bids at auction time
• Raises bids when conversion likely, lowers when not
• Good bridge between manual and full Smart Bidding
• Enable after 30 days of manual CPC data

Smart Bidding

How Smart Bidding Works

Google's auction-time bidding uses real-time signals:

• Device, location, time, browser, search query context
• Audience membership (in-market, remarketing, Customer Match)
• Page context (for Display)
• Historical performance patterns

Key principle: Smart Bidding needs conversion data volume to function. Starve it of data = poor performance.

Learning Period

Every time you:

• Switch bidding strategies
• Make large budget changes (>20%)
• Significantly change targeting
• Reset conversion tracking

The campaign enters a ~1-2 week learning period. Don't touch settings during learning.

Learning phase signals:

• "Learning" badge in campaign status
• Volatile CPA/ROAS — normal
• Lower volume — algorithm being conservative

Target CPA (tCPA)

Setup

1. Enable conversion tracking with meaningful conversion actions
2. Accumulate 30+ conversions in last 30 days
3. Set target CPA = your acceptable cost per conversion

Target Setting

Starting target formula:

Starting tCPA = Current CPA × 1.1 to 1.2

Set slightly above actual CPA to give algorithm room to win auctions.

Do NOT:

• Set target far below actual CPA on day 1 (algorithm can't hit it, severely limits volume)
• Set target equal to margin (leaves no room for learning variance)

tCPA Optimization Over Time

• After 2 weeks of stable performance: reduce target by 5-10%
• Wait 2 weeks; check volume and CPA
• Continue reducing incrementally until volume drops unacceptably
• Sweet spot: lowest CPA where you're still getting adequate conversion volume

tCPA Troubleshooting

Target ROAS (tROAS)

Setup Requirements

• Conversion tracking with values assigned to each conversion
• 50+ conversions per month (preferably 100+)
• Meaningful variation in conversion values (not all the same value)

Target Setting

Calculate break-even ROAS:

Break-even ROAS = 1 / Gross Margin %
Example: 40% margin → break-even ROAS = 2.5 (250%)
Profitable ROAS target = 3.0-4.0 (300-400%)

Starting target:

Starting tROAS = Actual ROAS × 0.9 to 0.95

Slightly below actual ROAS for headroom.

tROAS Optimization

• Incrementally raise ROAS target (5-10% steps)
• Monitor conversion volume — higher ROAS target = lower volume
• Find optimal point: highest ROAS where volume is acceptable

When tROAS Fails

• Not enough conversion volume → use tCPA instead
• Conversion values all the same → use tCPA (values add no signal)
• Seasonal spikes → temporarily lower target during peak periods

Maximize Conversions / Maximize Conversion Value

Use When

• New campaign with no history but want to go beyond manual
• Have conversion tracking but not enough data for tCPA/tROAS targets
• Want to spend full budget and gather conversion data quickly

With Targets

• Add tCPA to "Maximize Conversions" = effectively same as tCPA
• Add tROAS to "Maximize Conversion Value" = effectively same as tROAS
• Useful when switching — start uncapped, then add target once learning completes

Portfolio Bid Strategies

What They Are

A shared bidding strategy applied across multiple campaigns.

When to Use

• Multiple similar campaigns with shared goals
• Want to hit aggregate CPA/ROAS target across portfolio (individual campaigns can vary)
• Consolidates conversion data for faster learning

Setup

1. Tools & Settings → Shared Library → Bid Strategies
2. Create portfolio strategy (tCPA, tROAS, Maximize Conversions)
3. Apply to campaigns in the same product/service category

Portfolio Strategy Benefits

• Algorithm can shift budget between campaigns toward best-performing
• Aggregate conversion data speeds learning
• Easier to manage targets at portfolio level

Bid Adjustments

Layer on top of any bidding strategy to modify bids based on context.

Device Adjustments

Range: -100% (exclude) to +900%

How to set:

• Run device performance report (last 90 days)
• Calculate CPA per device vs. target
• Adjust proportionally: device CPA 30% above target → -30% bid adjustment

Note: With Smart Bidding, device adjustments are mostly overridden. Only use with manual CPC or eCPC.

Location Adjustments

Range: -90% to +900%

• Run geographic report → city/region level
• Bid up high-converting locations (+10-30%)
• Bid down or exclude locations with high spend / 0 conversions

Time-of-Day Adjustments (Ad Scheduling)

Range: -100% (exclude) to +900%

• Requires 60+ days of data to be meaningful
• Run dayparting report: hour of day × day of week
• Apply bid modifiers for peak conversion windows
• Exclude dead hours (e.g., 2-4am for B2B)

Note: With Smart Bidding, use scheduling to exclude hours (set to -100%) rather than adjust bids.

Audience Adjustments

Layer audience bid modifiers on top of keyword targeting:

Bid Strategy by Campaign Type

CPC Benchmarks by Industry

Budget Allocation

Budget Distribution Rule of Thumb

Brand campaigns: 10-20% of budget (high ROI, protect)
Non-brand / core: 50-60% of budget (primary driver)
Remarketing: 10-15% of budget (high CVR)
Prospecting / awareness: 10-20% of budget (top-of-funnel)

Budget Changes and Learning

• Changing budget by >20% triggers learning period for Smart Bidding
• For large increases: scale up 15-20% per week
• For decreases: cut more aggressively — recovery is faster than growth

Shared Budgets

• Use shared budgets for tightly related campaigns
• Allows budget to flow to best-performing campaign automatically
• Do NOT combine campaigns with very different economics in one shared budget

Optimization Checklist

Weekly

• Campaign bid strategy status — any "Limited" or "Eligible (limited)"?
• Learning period status — any campaigns stuck in learning?
• CPA/ROAS vs. target — on track or drifting?
• Impression share: budget-limited or rank-limited?

Monthly

• Bid adjustment review: device, location, time, audience
• Budget allocation — shift to higher-performing campaigns
• Target review — should CPA/ROAS targets be tightened or loosened?
• Portfolio strategy performance vs. individual campaign strategies

Quarterly

• Strategy review — are campaigns mature enough for more automation?
• Seasonality adjustments — apply seasonal bid adjustments proactively
• LTV-based target recalculation — do targets reflect current unit economics?

Common Mistakes

Target Setting

• Setting tCPA far below actual CPA immediately (starves volume, never recovers)
• Using tROAS without conversion values assigned
• Not giving enough learning time before changing targets

Learning Period

• Changing campaigns weekly during learning phase
• Making large budget cuts that force re-learning
• Switching strategies repeatedly (each switch = reset)

Bid Adjustments

• Using device bid adjustments with Smart Bidding (mostly ignored)
• Applying audience bid adjustments without enough data (act on noise)
• Setting location exclusions without looking at 90-day data

Related Skills

• google-ads-conversion-tracking: Conversion data is the fuel for Smart Bidding — must be set up correctly first
• google-ads-search: Applying bidding to search campaigns and keywords
• google-ads-shopping: ROAS bidding for Shopping and listing groups
• google-ads-pmax: PMax bidding progression and learning phase management
• google-ads-audiences: Audience bid adjustments and RLSA layering