How To Tell If You Need Time Of Day Bid Modifiers

By Jacob Fairclough | @RealSecretJake | Senior Account Analyst at Hanapin Marketing

To be in the PPC industry, you need a strong love of optimization. Beyond the basics is a plethora of adjustments, one of which tends to be underutilized. I’m talking about the time of day bid modifiers. Often times the time of day scheduling is an either/or. Either ads are enabled or they are completely turned off.


Some accounts don’t need finer tuning, but many do. Ignoring hourly modifiers is either hurting you directly, by spending inefficiently or hurting your potential, by leaving conversions on the table. Today, we will look into time of day modifiers and figure out if you need them and how you can get started.


Where To Find The Metrics


You can find time of day metrics in both the dimensions tab of AdWords or Google Analytics.


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Finding time of day data in the AdWords dimensions tab


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Hour of day data in Google Analytics


From here you can segment performance by keyword, ad group, and campaign. The two you are most likely to use are campaign and account level. In Analytics, you’ll make the selection through the secondary dimension menu. In AdWords, the dimensions tab will default to the level you are currently viewing.


The benefit of the campaign level is that it is more specific to that group of keywords and ads. The upside of the aggregate is that you have more data to work with and often times the same trends will repeat across separate campaigns.


You could potentially look at ad group or keyword level data in Analytics, but they are of limited usefulness since the modifiers exist at the campaign level in AdWords. The only time I would recommend diving deeper is if you think different areas of the campaign behave vastly different. This is the exception rather than the norm and shouldn’t occur in well-organized accounts.


Viewing The Metrics


You may pick up on certain trends by looking through the default tables, however, it’s not the most intuitive way. It is easier to pick up on trends with a few basic graphs.


One of the most intuitive methods is plotting conversion rate along time of day. While the table shows you areas where it increases or decreases the graph clearly shows where there are sustained areas of higher conversions. Higher conversion rates mean more conversions for the click volume.


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Conversion rate by sessions


The other metrics you’ll want to review are total revenue or leads per hour. While the conversion rates or average order value sheds light on efficiency, it doesn’t tell you how much of an impact it will have. You want to focus on the higher traffic areas because the higher number of clicks leads the data to be more representative of actual behavior.


How To Get Started


You most likely don’t have enough data to go full-blown hour by hour for each day. You’ll want to focus on chunking the hours into segments. For example, performance between 8 AM and 2 PM is similar while we see the increase in conversion rates between 2 PM and 8 PM.


Or, using the example above we’ll want to adjust for the morning hours, as conversion rates are highest then. We want to capitalize on all of those clicks with higher potential. Taking click volume into consideration we want to find a strategy for later in the day as well, as our traffic peaks in the later afternoon and early evening hours.


Rather than set these modifiers hour by hour we can set them as discrete chunks and save a little time. For instance, we may set a modifier for 7 AM – 11 AM as those are our peak conversion times. Then we set an adjustment for 2 PM – 8 PM as those are the most competitive and highest volume times. Even though we lose out on base efficiency, if we don’t control this section of time, we risk losing a large amount of total revenue/lead volume.


There are plenty of ways to determine your bid modifiers. The most common method is to take the average CPA in the account and divide it by the CPA for that time period.


Bid Modifier = Day Part CPA/Account Average CPA – 1


This is one of the most accurate ways to do this, but I would advise setting a limit such as 20%. Go too far and you might bid yourself right out of the auction. While CPCs and cost are related you may find a -15% bid change leads to 30% in cost savings while a -30% bid change results in a 75% cost in savings but cuts off all your conversions.


Other metrics you should keep an eye on include CPC by hour and position by hour. Don’t optimize on these alone but keep them in mind to gauge the impact. Sometimes you will find large swings in CPC that are hidden when you only look at the average over a day. Secondly, depending on your CPCs, even small changes during high traffic times can lead to much higher spend if all competitors increase bids during the same interval.


What’s Next?


You don’t need to spend an excessive amount of time on bid modifiers as it can take a long time to accrue significant data at the hour level. Even the analysis can take up a large chunk of time if you dive too deeply.


This is why I proposed chunking your day into segments rather than going hour by hour for your changes. By setting basic modifiers you get started in the right direction and can start calculating data on the impact of the changes. This keeps you from overextending on valuable time for something that may have limited impact.


When checking in on early performance you shouldn’t worry about further adjustments right now. Rather ask, “Are they helping or hurting?” Think of the modifiers as a directional push.


Too often, we tout the data-driven nature of PPC and focus on over optimization. Rather than hitting specific numbers ask the more basic questions such as “What impact does a 10% bid modifier have on revenue volume?” These modifiers won’t save your account, but they give you more control over crucial moments during the day and can mean the difference between hitting and missing goals.