CPA Bid Management – Google AdWords Conversion Optimizer

Google just announced the addition of Target CPA Bidding to its conversion optimizer tool.  With this feature, you can set the Target Cost Per Acquisition (CPA) Bidding at the campaign level which lets Google AdWords know the average amount you are ready to pay for a conversion.

When Google first introduced Conversion Optimizer, the tool had some shortcomings and in few occasions that I tried it, it did not have the results I was expecting and I had to move back to the manual bidding to keep the Cost per Conversion (CPA) in check.   However, over time Google’s bid management tool improved.

The challenge with the tool was that it was looking at the Max CPA bids (the bid amount you were willing to pay for a conversion for each Ad Group) as opposed to the target CPA which was making the tool less flexible and as a result, in some situations, it was limiting the chance of maximizing the number of conversions.  Bidding with a target or average CPA allows for maximizing the number of conversions while keeping your target CPA in mind.

For the CPA bidding option to be available in the “Advance Options” under “Focus on Conversions” section of campaign settings, you need to have Google conversion tracking active, have received conversions at a similar rate for a while and have at least 15 conversions recorded in the 30 days.

Google AdWords takes into consideration various factors when trying to analyze, optimize and maximize the ROI of a campaign such as keyword matches, search partner sites, content site topics, user location, operating system, browser, language setting, and seasonality.

In order for Conversion Optimizer to work properly, Position Preference and Advanced Ad Scheduling needs to be turned off.

This tool will make the need for a third party bid management software for those who do not manage the bids for their PPC advertising manually less relevant.

Filed Under: PPC Advertising • Search Engine Marketing • SEM