Bid adjustments allow PPC managers to increase or decrease the amount they are willing to pay per click depending on the search audience. For example, if your company is based in Chicago and you tend to get more sales from around Chicago, you may want to make sure your ad shows higher in the search results for people near Chicago who are more familiar with or loyal to your brand. Therefore, you could increase your bids for just that audience by, let’s say, 30%. For searchers in the rest of the country, you’d save money by remaining in a lower position since they are less likely to purchase from you, but you’ve increased your chances of being seen by the audience that is more valuable to you.
Keep in mind that the intended effect when adjusting bids is a change in position, not a change in budget allotment.
Theoretically, the actual CPC for this audience may increase and this audience may win more impressions due to the higher bid. However, bid adjustments will not automatically favor one audience over another. It will not push more of your budget towards the more qualified audience.
Here are a few important things to keep in mind when implementing bid adjustments:
- Increasing bids in ad groups with an average position of 1 will usually not be very effective. You’re already achieving position one, so the change won’t make a difference. In rare cases, however, some ad groups will have an average position of 1 but lose impression share due to rank, which can be a result of competition or relevancy to certain queries. When this is the case, bid increases may help capture more impressions. Take a look at those stats to see if bid adjustments would be helpful.
- Adjusting bids for more than one factor can have more extreme effects than you intended. Let’s say that in one campaign you have a 20% bid increase in place between 11 am and 2 pm every weekday and you have a 20% bid increase for searchers within 30 miles of Chicago, and then you also have a 20% bid increase for anyone who has previously visited your site. That means that the bids for searches near Chicago during 11 and 2 on weekdays by people who have recently visited your site are getting bumped up by over 60%. If that is not the intended outcome, one of these rules is going to have to change. Remove the bid adjustments for audiences that are least important to you.
- Understand your goal and make sure you’re using the right strategy. Ask yourself what effect you’re trying to get out of the adjustment. Are you trying to increase average position and impression share? Are you trying to reduce spend and average CPC? Do you just want to capture more of the traffic coming from a specific region? Bid adjustments may not always be the answer for what you’re trying to solve. Sometimes it makes more sense to break out new campaigns with differently targeted settings.
- Understand the impact of your bid adjustments. Compare your average CPC before and after implementation to see if it made a significant impact overall. Also, calculate some examples to see what your new bids will actually end up being.
