01 Dec How often should you change bids for your keywords?
The AdWords advertising system utilizes an auction-like process to decide which advertisers’ ads get to show and in which order. By bidding higher or lower, you can appear at higher or lower positions, depending on what your competitors are bidding
Bid optimization is one of the oldest features in the SEM software industry. Options for automated bidding are available but not all agencies and consultants have the budget or inclination to pay for the system to help them manage their AdWords account. So the option left to them is manually setting and tweaking bids over time.
How different people approach manual bidding?
Some people like the approach of going in daily, weekly or monthly and comparing performance over time to see if there’s been a change. Others simply like to examine positions, and for keywords that are showing too low, bid them up. The more sophisticated will actually examine cost per lead or Return on Ad Spend (ROAS), and adjust bids based on that — keywords with CPAs higher than the account average are bid down, and keywords with CPAs lower than the account average are bid up.
When is the right time to tweak a bid? And how often should one change the bids?
Answer is simple, Analyze! Analyze bids more frequently rather than just taking a look once a month. Check how many clicks and conversation a key word got. Depending on this you can modify your bid. But this just one way of doing it and once week or a month won’t be an enough time to decide whether a keyword is working. Sometimes it takes a little longer for a keyword to get noticed.
But till that time comes, you don’t have to just sit and wait, spare your time implementing more advanced optimization techniques like dayparting, or mobile or geographic bid modifiers. That way, you can improve performance in other ways and have plenty of “evidence of industry” for your boss or client, besides just lots of bid changes.
If you have a keyword with 200 impressions, eight clicks and one conversion that cost you an average of $3.00/click when the account CPA is $30.00, what does that tell you about whether you’re bidding too high or too low for that keyword?
Answer: absolutely nothing. Don’t even bother calculating what CPA you just achieved; it’s not even worth your time. Basically, you have No idea what is up with that keyword. Because a single conversion is not enough to tell you anything!
While tweaking the bids of a keyword, certain problems may arrive. For instance, People who religiously adjust their bidding on a weekly basis are particularly susceptible to this. Since you’re disturbing the bids, you’re mixing data from different bid levels together. So if you examine performance over the last month, you have maybe three weeks at one bid and one week at another bid, would you remember all of you bid history? The answer is obvious, NO!
Another problem is there’s a tendency to jerk bids around. You change a keyword’s bid one week, then you forget and change the same keyword’s bid the next week… in the opposite direction. Or you may be making the same decision twice — bidding up, then bidding up again the next week before there’s been enough time for data to accumulate at the new level.
What are the solutions to tackle these problems?
You can associate that keyword with other keywords in the same keyword space — i.e., you can analyze at the ad group level, or the campaign level, or associate the keyword with others in other ways, in order to aggregate and get more data.
Or you can simply… wait.
Account managers hate waiting; they like to tell their boss they are in there tweaking the account, making changes left and right, and so forth. It feels bad to not make bid changes. What if someone looks at the account history and sees you haven’t made any bid changes in months? Won’t it look bad?
But guess what: If you don’t have enough data for a rational decision, you shouldn’t be making changes!