Finalist: Man vs Machine: Is Automated Bidding Software Right for You?
In theory automated bidding systems are a great tool. You set your target metric, assign it to your campaigns and sit back and watch it manage your keywords to your set target. I mean what could go wrong? It is supposed to save you more time in day to make your accounts better by not having to worry about bid management. It sounds perfect doesn’t it? I’m telling you to be careful about using an automated bidding tool, and here is why:
1. Make sure that you have an account big enough
Automated bidding tools are made for huge accounts that have thousands of keywords and millions in ad spend. Their algorithms are designed to handle these types of accounts. If you have a relatively small account there is a good chance that the algorithm is not going to give you the lift and efficiency you are looking for.
2. Be aware of lag time and seasonality
If your business has any lag between taking an initial action on your site and the completion of the transaction, you have to take this in account with automated bidding systems. While these systems claim to take this into account, there is not an effective way to program an algorithm to understand things like, “seasonality,” or “multiple day conversion process.”
Most business has a high point and a low point and as an account manager you should know exactly when this time comes into play and you should account for it. In the case of an automated system they are going after your target metric and using historical data to factor the bid. If you historically have a strong holiday season, but business falls off tremendously in January, “man” version of you would start to decrease bids knowing the conversion rate and demand will decrease “Machine” version of you won’t, since it will factor in the conversion rate of the previous strong months. By the time machine realizes that conversion rates have tanked, you have already over-spent with no results to show for it.
3. Does your target metric really matter?
Your target metric is supposed to be the most you are willing to pay for that action. For this test we ran with an automated bidding system we have a bidding folder and a control folder. We set a test target cost per action and that was the most that we were willing to spend. The folders ran for 18 days and the bidding was supposed to give lift to conversions all while staying below the target cost per action. Here are the results:
They missed the test target cost per action. The control outperformed the bidding folder. I gave them the benefit of the doubt thinking that it takes a couple of days to get the algorithm going and it should hit its stride in the last ten days of the test. Here are the results of the last ten days of the test.
Again they missed the target cost per action and instead of getting a downward trend it increased pretty significantly. The algorithm did not take in account the conversion was dropping the cost per action suffered because of it. The lessons learned from this is that if you have worked in account for a period of time and you know how the account is going to perform over time you can and will beat an automated system.
4. When is it ok to use an automated system
The perfect account to use an automated system is an account that has an unmanageable number of keywords to keep track of on a daily basis. By having a massive amount of keywords it helps as a buffer for the underperforming keywords and makes entire ad groups and campaigns perform. For those huge brands that have thousands of keywords and ad groups there is no way one account manager can keep track of that much traffic and be effective. That is what automated systems are designed for so keep that in mind if you are looking to go automated.
Get Your Brand in Front of Dedicated PPC Pros!
We're headed to London to join nearly 300 of our best PPC friends. And we still have a limited number of opportunities for your brand to join us!
The Top Ten Tips For Effective Dayparting
Determining your need for hour of day modifiers can provide extremely competitive returns based on time invested in implementing.
A bi-weekly newsletter packed full of resources and strategies that will help make you a better PPC expert.
Hanapin Marketing | The PPC Agency of Experts Behind PPC Hero
Should You Be Creating Device Specific Campaigns?
Creating new device specific campaigns is a lot of work and can potentially overcrowd your account. You need to determine if this tactic is right for you.
9 Hero Conf London Advanced Sessions You Can't Miss
If you'd like some more details (and we've got plenty of details), how about a rundown of the deepest, most actionable sessions you'll see. These 9 sessions are designed for the expert-level PPC professional.
Why Your PPC Account Isn’t Living Up To Its Potential
I will review common themes that I see in either prospective clients, new clients, or accounts that are red that aren't living up to their potential.
[New Webinar!] 6 Steps To An Advanced Competitor Analysis For Digital Marke...
In this new live webinar, Hanapin’s Jacob Fairclough and SEMrush’s Paul Klebanov will direct you through the process of analyzing your own account, comparing it to your competition, and taking the steps to put your brand above the rest.
5 Psychological Principles You Should Be Using In Your Marketing
I propose that knowing what your audience is thinking or even the steps in their thought process is even more beneficial than simply knowing who they are.
Add It To The List - Structured Snippets Now Available In Bing
Another item for the list of new features in Bing - Structured Snippets are now available to all U.S. advertisers, with international support already being rolled out.
Do You Want A Free PPC Hero T-Shirt?
We're conducting a brief 2-minute survey to get your thoughts and opinions. By taking the survey, you'll get entered to win a certified PPC Hero shirt! Fill out the survey by Friday, September 23rd.
4 Tips To Survive An Account Manager Change
Have you ever received a call or email from your agency that you will be getting a new account manager? The thought could be frightening, especially if you LOVE your current AM. After you take a deep breath and realize life will go on, keep...
Build Your PPC Network, One Pro at a Time!
Do you ever feel that the people who understand your role best live mostly on Twitter? Is it sometimes difficult to find those few individuals you know you can count on for the best PPC advice? We’ve got the solution for your paid search woes.
Balancing Volume, Competition, And Intent To Find The Right Keyword
Although it isn’t going to bring results as quickly as a PPC campaign (and you can even use these methods for PPC), you can’t go wrong with a good old organic traffic campaign running alongside your ads.