The Necessity of Regular Bid Changes

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

Bid strategy is often lost in all the talk about keywords, structure, and ad copy. At its core, AdWords has always been an auction. Bids ultimately have a major impact on the success of an account.


Bid strategy should always be under evaluation. At no point should you settle on “well that is what the bids have always been set to”. This attitude will either lead you to underspend or overspend. No matter how many keywords you add or ad variations you try, you will always be held back by a poor bidding strategy.


By taking control of your bids, either manually or via bid rules, you can better pace your account against the marketplace. Since AdWords is an auction, your competitor’s bids will have an impact on yours. By routinely changing bids you can continually adapt to the market, pushing and pulling where needed to hit your goals more easily.


Spending Too Much


Besides capping budgets or pausing parts of your account, bids are the top way to control costs. Naturally higher positions cost more than lower positions and get more clicks, creating more spend.


By reducing bids en masse, you can easily pull back on your total spend without sacrificing certain parts of your account. This generic Band-Aid solution can be effective in keeping the impressions flowing while controlling costs. This won’t be something you do routinely but is a great way to let a portion of your account slow down a bit without stopping completely.


Spending Too Little


If spend and clicks are too low, you may opt to increase bids. This strategy works in reverse to the example above. Rather than make bulk cuts, you make increases to groups of keywords to increase traffic.


You might use this strategy for a new campaign. You don’t have enough data to evaluate where the optimal bid is so you decide to let the traffic flow in for a week or two before evaluating.


Rather than go keyword by keyword, you instead increase all bids by 20%. This should increase traffic to your new keywords, more easily allowing you to evaluate performance over the coming weeks. This isn’t just for new campaigns though. In e-commerce it is a viable strategy for new product launches or limited time windows.


CPAs Are Too High or ROAS Is Too Low


The first two examples were quite simple and only an introduction to the topic. The most often reason for changing bids is to correct performance issues. These issues usually come in the form of high CPAs or low ROAS, both symptoms of overpaying for conversions. Sometimes it is necessary because lead quantity or revenue is more important than spend but this tactic is not often sustainable over the long term.


When it comes to routine bid management, the basic concept it to regularly evaluate performance and adjust the bids accordingly. If CPA is too high, reduce the bids, if CPA is low and you want to try gaining more volume, you may increase the bids.
These could be minor or major changes. If CPA is way too high, you may implement large changes while small tweaks may be all that is needed when you are around goal levels. Based on this strategy you can see why you shouldn’t be worried about routine bid changes.


Why Routine Changes Matter


Changing the bids isn’t the only issue as frequency also comes into play. You never want to change bids to frequently or you’ll never get a stable baseline. You don’t want to wait too long either since it’ll be harder to stay the course over time.


Many of my own accounts do well with weekly bid changes. Depending on current performance I may look back 14 days, 30 days, etc. I find myself using 14 more often but have not seen major changes between 14 and 30. You could even use 7 days or 45 days if you’d like. The main concept to keep in mind is changing it up every now and to account for variance over time.


By continually adjusting bids you not only keep pace with the marketplace but also have a better grasp of performance. By understanding and developing a bidding strategy, whether automated or manual, you are better able to align yourself in auctions to hit your goals. The biggest mistake you can make when it comes to bid changes is being passive over time in turn causing you to be more reactive when performance eventually starts to change.


By considering your bidding strategy in routine maintenance, you take control of your account. While adding keywords and updating ad copy is easy, it is only the first step. If you really want to win in the crowded AdWords market place, you need to take control of your bids.