Flexible Bidding Strategies

This week Matt Umbro (@Matt_Umbro) came up with yet another great question set titled “Flexible Bidding Strategies.” The following is the transcribed Streamcap from the live chat:

Q1: What are your thoughts on bid management software in general? Why?

  • I’m not big on bid management software. I like to get my own hands dirty with managing bids, etc! – Nathan Schubert (@NateSchubert)
  • If they are setup properly they are amazing when you scale a campaign! Need to manage the % auto vs manual. – Russell McAthy (@therustybear)
  • Bids may not be #1 task of acct management, but it’s the client’s money. Like to be able to monitor closely. – Theresa Zook (@I_Marketer)
  • Bid management tools can be useful to automate certain tasks and help augment human talent. – Jeremy Brown (@JBGuru)
  • Not a big fan of bid management, but am always willing to test. – Matt Umbro
  • Exp with Doubleclick a mixed bag at best. For bid mgmt per se it has helped, but it makes a lot of other things more complicated. – Max Fink (@maxfink_SEM)
  • Search tools must do more than just automate bids. Software that only provides rules or portfolio is only doing 1/5 of the work. – Chris Haleua (@chrishaleua)
  • Bid Management Software is often necessary, but not always as crucial as some people would have us believe. – Martin Rottgerding (@bloomarty)
  • Prefer to manage by hand. Additional work involved with bid mgmt programs hasn’t saved time or shown much benefit. – Nicole Mintiens (@Tregesy)
  • I dig bid management software, large KW inventories are just unmanageable otherwise. – Heather Cooan (@HeatherCooan)
  • Search tools must provide a balance of ad testing, kw suggestions, attribution reporting, smart alerts, targeting, and bidding. – Chris Haleua
  • Bid mgmt platforms seem better for plain vanilla ecommerce than for anything that has any ext revenue dependencies like leadgen. – Max Fink
  • To get the best results you have to invest a lot of time setting up the BM S/W, personally I’m more a hands on fan. – Andrew Baker (@AndrewBaker72)
  • Helpful for managing many large accounts with varying KPIs. Also, very expensive.. I prefer the manual approach. – Dave Rosborough (@daverosborough)

Q2: Are you currently using any of the flexible bid strategies allowed by AdWords? If so, which one(s)?

  • Target CPA to combat EC margin disruptions now that I can’t manually control tablets! The others I’m not too excited about…but I will play with bid to ROAS. – Heather Cooan
  • No, but I’ve tried Target CPA in the past. – Jonathan Levey (@jlevey)
  • No, we use Kenshoo. – Jeremy Brown
  • I’m using target CPA in a few ancillary campaigns…so far so good. – Matt Umbro
  • No. The good old Conversion Optimizer is just much more flexible. “Flexible” target CPA doesn’t seem to have any advantage. – Martin Rottgerding
    • The problem I’ve always had with CO is that it locks you out of kw level opts. The flexible option allows for this. – Heather Cooan
      • Also locks out newer features like bid adjustments. – Timothy Jensen (@timothyjjensen)
      • True, but it doesn’t allow for different adgroup level CPAs which is a huge setback. – Martin Rottgerding
        • Yes it does, you can still adjust the CPA at the ad group level like you would CO or use a separate FBS. – Heather Cooan
  • In general, I’m testing out the flexible bidding strategies in campaigns that won’t make huge differences. – Matt Umbro
  • I’m testing position bidding based on position analysis for a few campaings. – Sean Evanko (@sevanko)
  • The target CPA FBS is great for holding volumes while manually adjusting problem CPA ad groups and kw’s. I’m digging the smarts of conversion optimizer + flexibility. – Heather Cooan
  • Have you had any success with the new ROI-based option? – Dave Rosborough
    • Haven’t used it yet…in fact, just saw it for the first time in an account today. – Matt Umbro
  • I’d wish flexible CPA wouldn’t look at campaigns individually – no idea why Google implemented it that way. It’s useless to us. – Martin Rottgerding
  • I wonder if anyone loves their bid mgmt software? Doubleclick gets a C- at best in terms of usability, IMHO. – Max Fink

Q3: Why would you use flexible bid strategies?

  • It’s strange that you have to delete bid adjustments 1st. We don’t have to delete CPC bids – why not just mute adjustements? – Martin Rottgerding
  • I am personally using flexible bidding strategies to test effectiveness and potenially find a bidding solution. – Matt Umbro
  • I’m using them to preserve volumes and combat high CPA’s post EC migrations. – Heather Cooan
  • Just activated a flexible strategy and then CO. It actually preserved my bid adjustments in both cases. – Martin Rottgerding

Q4: What are some benefits of the “Enhanced CPC” flexible bidding strategy?

  • The only benefit is that you don’t have to apply it campaign wide. – Martin Rottgerding
  • "Enhanced CPC” flexible bidding will help optimize the bids of the keywords which convert better. – Jonathan Levey
  • Haven’t tested it yet – I don’t like the idea giving that much control. – Sean Evanko

Q5: Do you believe the new bid strategy, “Target ROAS,” will be useful? Why or why not?

  • Yes, I’m excited about this one. ROAS is a very granular way of looking at sales. Could be fabulous. – Theresa Zook
    • Potentially, all speculation right now, will have to dig in and test! – Matt Umbro
  • Perhaps, but there are so many variables involved with hitting a target ROAS that i don’t know the system accounts for. Plus, we optimize for ROI (including mgmt fees and margins) Target ROAS won’t necessarily take these items into account. – Matt Umbro
  • I think it could be great, but it’s an advanced feature. 80% of advertisers won’t even find it. – Robert Brady (@robert_brady)
  • Target ROAS can certainly do a much better job than target CPA bidding for certain accounts. Very + experiences for some. – Max Fink
  • If it works it could replace 3rd party bid tools thanks to RealTimeBidding. But the requirements prevent use in small campaigns. – Martin Rottgerding
    • Yep, T-ROAS reduces the motivation one has for a 3rd party system–if it works through AW natvely though I am not sure. – Max Fink
  • Yes. Other metrics like conversion rate can often trick you into thinking everything is performing perfectly. When in reality, profit may be suffering despite the other metrics looking good. – Dave Rosborough
    • Also worried about double conversions (those who refresh thank you page), though issue for target CPA as well. – Matt Umbro
      • Same as any other 3rd party tool using adwords tracking – not a real problem. – Martin Rottgerding
  • Target ROAS faces the same challenges as any other bid tool but has access to more levers. If you use other tools for this, try it. – Martin Rottgerding
  • Sounds promising but as anything w/ Google, always remember their new features benefit G 1st, clients 2nd. – Nathan Kilen (@nathankilen)

Q6: Do you tend to set your flexible bidding strategies at the campaign, ad group, or keyword level? Or all?

  • I’ve been testing more holistically so far…will move to specific ad group and keyword options shortly. – Matt Umbro
  • Not testing yet, but when I start, plan to start campaign-wide & refine from there. – Theresa Zook
  • Seems like ad group/keyword level options would be time consuming. I like the idea of testing holistically at first. – Dave Rosborough
  • Separate goals at lower levels can be helpful if you believe the system is wrong somewhere. But the overall goal stays the same. Except if you’ve been using CPA bids to emulate target ROAS – then you need adgroup bids at least. – Martin Rottgerding

Q7: Do you believe there is value to the “Target search page location” flexible bidding strategy?

  • Yes absolutely. If you mean for Google, that is. – Martin Rottgerding
  • I believe all AdW options need significant data to perform properly. I have no acct large enough to accurately test this. – Theresa Zook
  • I have one client where being in the top 3 is a big priority. Useful there. – Robert Brady
  • Considering the est bid info is always really off for 1st or top pg, not sure I want G making adjustments for me? – Julie Bacchini (@NeptuneMoon)
    • I agree. Those estimated bids are about as reliable as keyword QS. – Martin Rottgerding
  • If you really need top of page bids, I believe you should set them manually. Recipe for disaster otherwise. – Martin Rottgerding
  • I’ve always wondered what happens if Google gets 4 people w/ flex. bids for positions 1-3. – Robert Brady
  • We have some campaigns where est say should be $28 for top spot & it actually costs us $12. HUGE difference! If you’re not managing this stuff yourself, how would you know that you didn’t need to pay over $12 for that spot? – Julie Bacchini
    • Good point, that’s why it’s best to start these bidding strategies on lesser impactful campaigns. – Matt Umbro
    • I might *use* automated tools, but can’t imagine I’d *start* with them activated. – Theresa Zook
  • Bottom line is I’m going to test these bidding strategies and if they work great, if not no harm no foul. – Matt Umbro

Resources

More PPCChats

Don’t forget to stay tuned for the next #PPCchat on Tuesday at 12 noon Eastern, 9 am Pacific and 5pm in the UK. Same Chat time, same Chat channel.

Participants

Check out the PPCChat Twitter list to see and connect with all current and prior participants.

• Matt Umbro (@Matt_Umbro)
• Paul Kragthorpe (@PaulKragthorpe)
• Andrew Baker (@AndrewBaker72)
• Chris Haleua (@chrishaleua)
• Dave Rosborough (@daverosborough)
• Heather Cooan (@HeatherCooan)
• Jeremy Brown (@JBGuru)
• Jonathan Levey (@jlevey)
• Julie Bacchini (@NeptuneMoon)
• Martin Rottgerding (@bloomarty)
• Max Fink (@maxfink_SEM)
• Nathan Kilen (@nathankilen)
• Nathan Schubert (@NateSchubert)
• Nicole Mintiens (@Tregesy)
• Robert Brady (@robert_brady)
• Russell McAthy (@therustybear)
• Sean Evanko (@sevanko)
• Theresa Zook (@I_Marketer)
• Timothy Jensen (@timothyjjensen)
 

Flexible Streamcaps Provided By

This is a guest post by Paul Kragthorpe; WebRanking SEM Manager in Minneapolis, Minnesota, #PPCChat Streamcap Grabber, SEO Blog Author. Connect with me @PaulKragthorpe, and Google Plus.

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