October 8, 2021
The Ideal QA Process in Digital Advertising
Bid adjustments are an integral part of achieving PPC account goals. However, many people don’t realize that bid strategy will vary dramatically depending on whether the account goal is efficiency-based or growth-based. Everyone knows that we bid keywords up and down based on performance, but it is important for clients to understand the different bidding routes we can take to achieve their goals.
Keyword Bidding
On the surface, some scenarios are simple. If our client wants to be in #1 position for their branded terms when competing with aggressive resellers, and they don’t care how much it costs, we can use an automated bidding algorithm that keeps us in position #1. Or, let’s say we are trying to get lean and cut wasted spend in an account – we can do a simple filtered search in AdWords or Kenshoo to pause keywords that spent more than $200 over the past 3 months with no conversions.
Things get more complex when an account is performing close to goal and we want to maximize growth. For example purposes, let’s say that our client is a lead-based company that has historically seen leads come in between an $80-$150 CPA. They are trying to balance driving leads to a growing sales team while keeping investors happy with a profitable CPA. After a few months of Metric Theory optimizing campaigns and getting to know the client’s business, we have determined that leads become unprofitable when CPA creeps above $130. When CPA dips below $80, we sacrifice volume (which aggravates the sales team).
Additional Bidding Options
In addition to bid adjustments that are based on a keyword’s specific performance, we often make adjustments based on mobile device, geography, income level, time of day, and day of week. We like to layer these on top of one another to allocate spend to the strongest performers. However, it’s hard to determine what a “strong” performer is if we don’t have a precise and pre-determined goal. Having a distinct goal allows us to tailor every decision we make towards that goal, so that we can drive the best possible performance for the account.
Let’s take a look at one campaign’s performance by day of week and see how our recommendations would differ depending on the account’s goal.
Before We Start
When creating bid analyses, it’s important to look at performance in a more segmented manner than at the account level. We always analyze Shopping, Display, Brand, and Non-Brand separately, so we can optimize towards the unique performance of each campaign type.
Goal #1: Maximize Conversions Under a $120 CPA
Our client is currently in growth mode. This campaign is pretty close to our CPA goal, so a few minor adjustments here can make this campaign more efficient and allow us to shift more spend to our better performing days. We have noticeably less traffic on Friday, Saturday, and Sunday, and the weekends have a CPA well above our goal. Placing a bid modifier on these few days can allow us to get closer to the $120 CPA goal at the campaign level.
Goal #2: Maximize Conversions Under a $130 CPA
After further analysis, our client allows us to open the CPA floodgates a bit more to capture as many leads as possible. Just a $10 increase in our CPA allowance makes for a significantly different course of action. We’d still be bidding down on the weekends, but we can afford to increase bids on Monday – Thursday.
Goal #3: Cut CPA to $80
Things are changing for our client, and the sales team can’t handle the lead volume. This presents an opportunity for us to become super efficient and work towards an $80 CPA goal. This campaign has a much higher CPA than our goal. Instead of placing varying negative bid modifiers on every single day, we would make keyword bid adjustments across the campaign. However, we have enough data to know that Saturday and Sunday are weaker performers, so we would leave those negative bid modifiers in place. For the other days of the week, we can take another look at day of week performance in a couple of months, after we’ve accrued some new data.
Even at a glance, our bid adjustments vary for each of these different goals. This really emphasizes the importance of setting concrete goals to work towards, so we can make the best decisions for the account at every single level – from campaign budgets to keyword bids to day of week modifiers.
