A Guide to AdWords Bid Adjustments

By Rachael Law | @Law_Rachael | Account Analyst at Hanapin Marketing

Bid adjustments are a fundamental part of PPC. It’s important that you have a firm grasp of what your bid strategy is and what options you have in terms of actually changing those bids. While there are many bid management software options (Acquisio, Marin, etc.), we’ll go over the native features in the AdWords interface and the pros and cons of each.

Manual Bidding

If you are like many of us Hanapin Account Managers, you prefer to have the most control possible. This usually translates into manual bid changes through an Excel spreadsheet. Your bidding strategy will vary from account to account, but this strategy is generally how we approach the process:

Increase Bids

  • Keywords with relatively low average position that haven’t spent more than a threshold
  • Keywords that have converted within your goal CPA that are not in the top position

Decrease Bids

  • Keywords that have spent a significant amount without converting
  • Keywords converting at high CPAs

bid changes data

Again, your strategy may vary from account to account. I have seen some accounts where return on ad spend is best when ads are in position 3, as users are clicking multiple ads to do research before buying.

Pros & Cons of Manual Bidding

Pros:

  • Maximum control over your account

Cons:

  • Has the potential to be time consuming

Automated Bidding

To access the automated bid rules, either click the “Automate” button within the Keywords tab, or navigate to the Automated rules section of the Bulk operations tab on the left hand side of the interface.

automated bid rules

automated rules

This section is where AdWords allows you to set bid changes that will automatically run at the time and frequency you specify. This feature is ideal if you find yourself making the same bid adjustments week after week.

Pros & Cons of Automated Bid Rules

Pros:

  • Saves time by running automatically
  • More control than bid strategies

Cons:

  • There is some potential for error here if you don’t set up your rules correctly
  • Less control, you have to check the logs or change history to see what exactly was adjusted
  • Set it and forget it – if you don’t check in some time after the rules are set up you might not notice errors. It’s also important to change these if account goals change

Flexible Bid Strategies

With flexible bid strategies enabled, AdWords will automatically set bids to optimize towards a goal that you specify. These can be set for specific campaigns, ad groups, or keywords. There are 5 types of flexible bid strategies:

1)   Maximize clicks

2)   Target search page location

3)   Target CPA (only for campaigns & ad groups)

4)   Enhanced CPC (ECPC) (only for campaigns & ad groups)

5)   Target ROAS

bid strategy

bid strategy 2

Once you add a new bid strategy, there are many optional settings to give you a bit more control:

bid strategy 3

It is worth noting that you should keep in mind how many bid adjustments or bid strategies you are layering onto your campaigns. For example, in one of our accounts we had set up an automated bid rule to increase bids for a handful of keywords across multiple campaigns. However, it wasn’t adjusting bids on some keywords because a flexible bid strategy had been set for that campaign (another reason to check on your automated bid rules!). Check out this post on CPA flexible bidding results.

Pros & Cons of Flexible Bid Strategies

Pros:

  • Completely automated

Cons:

  • Not very much control – you’re trusting Google
  • Potentially murky results when layered with other bid adjustments and/or rules

Closing Thoughts

Each method of bid management has its pros and cons, and which one you choose depends on the account, goals, and your personal preference. Automated rules or flexible bid strategies might very well be worth testing in your accounts, but it’s not something you want to just set and forget, as they have the potential to affect performance greatly.

If you want the maximum amount of control over your account or you have very strict goals to adhere to, manual bidding might be the way to go. If you make the same bid adjustments week after week (converters get a 10% increase, high spenders get a 10% decrease, etc.) go ahead and try automated bid rules. If you’re a bit more open to testing and letting Google take the reigns, flexible bid strategies might give your account the boost it needs.

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