May 14, 2019
The Ultimate Guide to Google Ads Smart Bidding
Like most paid search pros, I want my Brand keywords in top position for every impression, thereby ensuring that my competition doesn’t steal my brand traffic. However, focusing purely on showing in Average Position 1.0 does not guarantee that you’ll always meet your account goals. Just like any paid search campaign, your brand performance will vary based on changes in competition, seasonality, and other factors, and your response to these changes should always be focused on achieving overall account goals.
When you see Average Position on brand terms begin to decline, either because new competitors are bidding on your brand keywords or other trends are impacting your brand campaign, you should carefully analyze where you are seeing the biggest impacts. You will likely see an increase in Average CPC for core brand terms, but you should be able to maintain your Average Position without significantly increasing your bids, since you should have very high quality scores for these terms.
However, you will likely see more significant increases to Average CPC for your indirect brand terms, such as ‘brand reviews’ or ‘brand vs competitor.’ Because the searcher’s intent for these terms is focused on finding information, and broader than just navigating to your site, you will likely have to pay more to maintain position. Terms like these also provide an opportunity for your competitors to move into a stronger position. In addition, there are queries like ‘brand software’ where many thousands of advertisers are running ads on broad match keywords containing ‘software’. Some of those ads will show for your brand queries.
In general, you should allow your account goals to guide your bidding strategy. If it’s very important that you own your space and show up all the time in Average Position 1.0, then you will need to increase your bids and accept higher brand CPAs or a lower return on ad spend (ROAS) for brand.
If your goal is to maximize account-wide ROAS, you will likely encounter diminishing returns if you significantly increase your brand bids. In one recent example, improving our average position from 1.4 to 1.3 caused our ROAS for that campaign to fall by nearly 49%. We judged that the investment required to achieve this small improvement in Average Position did not justify the significant drop in ROAS. When we reduced bids, ROAS recovered almost immediately, jumping 31% in less than a week.
Ultimately your Average Position is less important than your main account goal. If owning your space is of supreme importance, you can be more aggressive with your brand bidding. Though we should note that achieving Average Position 1.0 on all brand queries (including misspellings, variants, etc.) is often very difficult and gets quite expensive. Even Metric Theory does not have Average Position 1.0 for all its brand queries. There are a few core brand terms where our Average Position is 1.3 due to Theory.com (a clothing retailer) showing up on occasion.
With all that in mind, if your goal is to maximize ROAS or achieve a goal CPA, you may find that an Average Position of 1.3 is optimal for your brand keywords.