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Advantages and Drawbacks of Google’s Smart Bidding Strategy

There exist various methods to manage cost-per-click (CPC) bidding for pay-per-click (PPC) campaigns. However, to optimize your digital marketing budget, you’ll want to select the bidding type that yields the most effective PPC performance.

Google Ads Intelligent Bidding is one of the more recent PPC tools for maximizing your spending efficiency. Through Intelligent Bidding, much of the uncertainty in adjusting your CPC bid limits is eliminated as advanced machine learning steps in to save you time and enhance your ads’ effectiveness.

Yet, this doesn’t imply that older available bidding techniques – primarily Google Ads automated bidding and manual bidding – lack their merits. Therefore, if you’re utilizing Google advertising agency tools to oversee PPC campaigns, here are the advantages and disadvantages of Intelligent Bidding Google Ads campaigns to ponder before settling on the bid strategy to attain optimal results and make the most of your budget.

What Is Google Ads Intelligent Bidding?

Intelligent Bidding in Google Ads empowers advertisers to employ machine learning to fine-tune their bids for conversions. Machine learning can make precise forecasts regarding different bid amounts and their impact on conversions through real-time data. Manually adjusting your bids in real-time would be infeasible even for a team of Google Ads specialists, as it continuously monitors real-time data around the clock.

Google Intelligent Bidding Vs. Automated Bidding Vs. Manual Bidding

To gain a deeper grasp of Intelligent Bidding Google Ads, business owners need to comprehend the components of PPC campaigns and how a PPC ads agency bases its decisions for digital marketing. There are two avenues for your website to reach the top position in search engine results: via a search engine optimization (SEO) strategy and a PPC strategy.

SEO constitutes a long-term solution that necessitates time for ranking, yet you don’t pay search engines like Google to secure a top spot for your website. Conversely, in managing PPC campaigns, you and your competitors vie for specific keywords based on your willingness to pay each time someone clicks on your ad. The victor of this auction secures the top spot for a keyword, and you only incur charges when someone clicks on the ad. While it’s a short-term solution, there are numerous scenarios where PPC proves to be the superior digital marketing option, either instead of or in conjunction with SEO.

A Google advertising agency has various methods to bid for the top position in PPC ads. These can be categorized into three groups: Google Ads Intelligent Bidding, Google automated bidding, and manual bidding.

Google Ads Smart BiddingGoogle Automated BiddingManual Bidding
What It IsA form of automated bidding that optimizes bids for conversion or your given goalsA bidding method where Google uses automated rules and additional data points to adjust your bid as necessary, depending on your goal.A bidding method where you manually set your maximum bids. It’s up to you how much you set your maximum bid at, but ideally, this number should be based on accurate and up-to-date performance metrics.
How It WorksYour online advertising agency can set up Google Smart Bidding for a new single campaign or change an existing campaign. Google will then set precise bids for every auction depending on your performance goals.After setting up your Google Ads automated bidding, your bids will be automated based on your goals, maximum spending, and other rules. Set your own maximum CPC for your ads, which serve as your default bid. That bid stays as-is until you change it.
ProsAdvanced machine learning algorithm.This adapts your algorithm based on your performance and historical data.
True action-time bid optimization.Optimizes your bid for every auction based on the data available, allowing you to maximize your budget effectively.
Comes in multiple automated bidding options: ○ Enhanced CPC ○ Maximize Clicks ○ Maximize Conversions ○ Maximize Conversion Value ○ Target Cost Per Action ○ Target Return on Ads Spend ○ Viewable Cost per Thousand Impressions ○ Cost Per ViewBest for new campaigns with no conversion data.New campaigns can’t benefit from Smart Bidding and Google Ads automated bidding if they haven’t reached the minimum amount of data needed.
Full control of the PPC campaign. Manual bidding provides full control over bidding.
ConsLack of transparency. Not all information that affects Smart Bidding is available to all advertisers.
Lack of control. Smart Bidding means relinquishing bidding control to machine learning.
Less control over the budget. Provide the budget, and Google will spend it on what it thinks gets you the best results for your goals.
Requires conversion tracking. If this isn’t enabled, it can be harder to track your conversions and make bad decisions based on this.
You’ll have to spend more time checking performance. You’ll need to check back with your PPC campaign from time to time to see if changes need to be made.
Your data may be outdated. Google metrics are always changing, and those with Google automated bidding get to base their data points on real-time information.

Intelligent Bidding shouldn’t automatically be your bidding strategy of choice until you know that you can best benefit from this option. It’s much better to discuss your goals and PPC performance with a Google Ads specialist and weigh in more of its pros and cons to see if this is the right solution to optimize PPC campaigns for your website.

Google Intelligent Bidding Pros

1. Real-Time Bidding

Following the implementation of Smart Bidding Google Ads for your campaigns, Google can interact and bid on unique search queries. Instead of bidding on every single keyword, Google examines relevant search queries in real time and bids on those that align best with your campaign.

This stands as one of the most valuable advantages of utilizing Smart Bidding. When using manual or automated bidding, it’s unfeasible to have a team of Google Ads specialists checking search queries and data around the clock and adjusting bids as necessary. With Smart Bidding, Google handles PPC management more efficiently.

2. Formulate Bids Based on Unavailable Data

Manual bidding involves adjusting bids whenever you deem fit, while Google Ads automated bidding adapts based on your established parameters. Ideally, you should adjust these based on user data accessible to everyone to maximize your budget. Through Smart Bidding, not only does Google base your adjustment on your own conversions, but it also utilizes a complete set of user data available to it. This encompasses data that the average advertiser doesn’t have access to.

This means that Smart Bidding’s machine learning grounds your PPC campaign bids on real-time data. While the extent of the impact of this additional data on your campaign isn’t clear, it’s an advantage if you aim to enhance your PPC performance.

3. Simplified Optimization of PPC Campaigns

Smart Bidding permits you to “set and forget” your new or existing campaign when managing your PPC campaigns. This implies that you don’t need to keep tabs on all the data and search queries related to your campaign. Instead, let Google’s advanced machine learning handle most of the guesswork and the necessary adjustments to maximize your ad spending.

If you lack the resources or expertise to track conversions or determine an optimized bidding amount manually, this is one of the strengths of a Smart Bidding strategy.

Google Intelligent Bidding Cons

1. Lack of Clarity

Google’s advanced machine learning has access to more data than most advertisers. While this can be an advantage for fine-tuning a campaign’s bids

, it also becomes a drawback if you want to track performance. If you’re keen on delving into the detailed performance of each keyword, you’ll find that a significant portion of the data is restricted. Moreover, you can’t entirely discern the factors influencing each bid adjustment.

2. Reduced Control Over Bids

It will be some time before machine learning attains perfection, so there’s still a likelihood of errors such as Google’s broad data and keyword bids not aligning with your own target audience. After all, Google may not grasp your business as intimately as you do.

This poses an issue when you identify a need to fine-tune your bids based on your own observations. Employing Smart Bidding entails entrusting the task to machine learning, irrespective of your familiarity with your website’s historical online conversion metrics. Consequently, you exert less control over managing PPC campaigns and PPC management.

3. Requires Some Data

Google Ads asserts that Smart Bidding can be effective even for new campaigns without data. However, this is contingent on the presence of other existing campaigns that can furnish data. And for precise results, your data must meet the threshold for a minimum number of conversions.

Should My PPC Campaign Be Using Smart Bidding?

Consider the choice between Smart Bidding, automated bidding, and manual bidding akin to purchasing a car. In this scenario, Smart Bidding is akin to buying a car and then hiring a driver to operate it for you. This is a splendid option for individuals who lack the know-how to drive a car but wish to reach a specific destination with it. Nevertheless, in the long run, you still don’t acquire the skill of driving.

The same principle applies to Smart Bidding. Smart Bidding is an excellent choice for small businesses to fine-tune their bids and display their ads for brand awareness, traffic, and conversions. However, this isn’t a sustainable solution, as your campaign relies solely on what Google perceives as beneficial for your campaign.

Over time, once the metrics and data from your Google Ads agency account amass sufficiently for sound observations, you can begin to steer your own bids and enhance your PPC campaigns. There are merits to manual bidding or utilizing Google Ads’ automated bidding. While Google possesses a comprehensive view of your keywords, you possess a superior understanding of your campaign objectives and target demographics. In such instances, it’s prudent to incorporate human insight into navigating your campaigns. This is where a PPC ads agency proves particularly advantageous.

Fine-Tune PPC Campaigns With The Google Ads Experts At Leadshouse

At Leadshouse, we refine our clients’ PPC campaigns for optimal outcomes. Whether your aim is to boost visibility, brand recognition, or amplify conversions, we collaborate with you and your Google Ads agency account to yield results and position you prominently for pivotal keywords.

For cost-effective marketing strategies, partner with an online advertising agency boasting years of experience and an in-depth comprehension of how to leverage your PPC campaigns. Get in touch with us today for your complimentary proposal for our PPC management services.

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