There are plenty of ways to handle cost-per-click (CPC) bidding for pay-per-click (PPC) campaigns. But to make the most of your digital marketing budget, you’ll want to choose the type of bidding that delivers the best PPC performance.
Google Ads Smart Bidding is one of the more recent PPC tools to optimize your spending. Through Smart Bidding, a lot of the guesswork of adjusting your CPC bid limits is taken out as you let advanced machine learning help save you time and improve your ads’ performance.
But that’s not to say that older available bidding methods – mainly Google Ads automated bidding and manual bidding – don’t have their advantages. So if you’re using Google advertising agency tools for managing PPC campaigns, here are the pros and cons of Smart Bidding Google Ads campaigns to consider before you decide to use the bid strategy to get the best results and make the most of your budget.
What Is Google Ads Smart Bidding?
Smart Bidding in Google Ads allows advertisers to use machine learning to optimize their bids for conversions. Machine learning can make accurate predictions on different bid amounts and how they affect conversions through real-time data. Adjusting your bids manually in real-time would be impossible even for a team of Google Ads specialists as it constantly checks real-time data around the clock.
Google Smart Bidding vs. Automated Bidding vs. Manual Bidding
To better understand Smart Bidding Google Ads, business owners need to know what goes into PPC campaigns and how a PPC ads agency bases its decisions for digital marketing. There are two ways your website can reach the top spot of search engine results: Through a search engine optimization (SEO) strategy and a PPC strategy.
SEO is a long-term solution that takes time to rank for, but you don’t pay search engines like Google to put your website in the top spots. Through managing PPC campaigns, on the other hand, you and your competitors bid on certain keywords based on how much you’re willing to pay every time someone clicks on your ad. Whoever wins this auction gets the top spot of a keyword, and you only pay when someone clicks on the ad. Although it’s a short-term solution, there are many cases where PPC is the better digital marketing solution used instead of or on top of SEO.
There are different ways for a Google advertising agency to bid for the top spot of PPC ads. These can be separated into three categories: Google Ads Smart Bidding, Google automated bidding and manual bidding.
| Google Ads Smart Bidding | Google Automated Bidding | Manual Bidding | |
| What It Is | A form of automated bidding that optimizes bids for conversion or your given goals | A bidding method where Google uses automated rules and additional data points to adjust your bid as necessary, depending on your goal. | A bidding method where you manually set your maximum bids. It’s up to you how much you set your maximum bid at, but ideally, this number should be based on accurate and up-to-date performance metrics. |
| How It Works | Your online advertising agency can set up Google Smart Bidding for a new single campaign or change an existing campaign. Google will then set precise bids for every auction depending on your performance goals. | After setting up your Google Ads automated bidding, your bids will be automated based on your goals, maximum spending, and other rules. | Set your own maximum CPC for your ads, which serve as your default bid. That bid stays as-is until you change it. |
| Pros | • Advanced machine learning algorithm. This adapts your algorithm based on your performance and historical data. • True action-time bid optimization. Optimizes your bid for every auction based on the data available, allowing you to maximize your budget effectively. | • Comes in multiple automated bidding options: ○ Enhanced CPC ○ Maximize Clicks ○ Maximize Conversions ○ Maximize Conversion Value ○ Target Cost Per Action ○ Target Return on Ads Spend ○ Viewable Cost per Thousand Impressions ○ Cost Per View | • Best for new campaigns with no conversion data. New campaigns can’t benefit from Smart Bidding and Google Ads automated bidding if they haven’t reached the minimum amount of data needed. • Full control of the PPC campaign. Manual bidding provides full control over bidding. |
| Cons | • Lack of transparency. Not all information that affects Smart Bidding is available to all advertisers. • Lack of control. Smart Bidding means relinquishing bidding control to machine learning. | • Less control over the budget. Provide the budget, and Google will spend it on what it thinks gets you the best results for your goals. • Requires conversion tracking. If this isn’t enabled, it can be harder to track your conversions and make bad decisions based on this. | • You’ll have to spend more time checking performance. You’ll need to check back with your PPC campaign from time to time to see if changes need to be made. • Your data may be outdated. Google metrics are always changing, and those with Google automated bidding get to base their data points on real-time information. |
Smart Bidding shouldn’t automatically be your bidding strategy of choice until you know that you can best benefit from this option. It’s much better to discuss your goals and PPC performance with a Google Ads specialist and weigh in more of its pros and cons to see if this is the right solution to optimize PPC campaigns for your website.
Google Smart Bidding Pros
1. Auction Time Bidding
After running Smart Bidding Google Ads for your campaigns, Google can interact and bid on unique search queries. Rather than bidding on every single keyword, Google looks at relevant search queries in real time and bids on those that best match your campaign.
This is one of the most valuable benefits of using Smart Bidding. When using manual or automated bidding, it’s unfeasible to have a team of Google Ads specialists checking search queries and data around the clock and adjusting bids as necessary. With Smart Bidding, Google does PPC management for you more efficiently.
2. Develop Bids Based on Unavailable Data
Manual bidding means changing bids whenever you see fit, while Google Ads automated bidding adjusts based on your set parameters. Ideally, you should be adjusting these based on user data that’s available to everyone to maximize your budget. Through Smart Bidding, not only does Google base your adjustment based on your own conversions, but with the full suite of user data available to it. This includes data that the average advertiser doesn’t have access to.
This means that Smart Bidding’s machine learning bases your PPC campaign bids on real-time data. While it’s unclear how much this extra data affects your campaign, it’s an advantage if you want to improve your PPC performance.
3. Easier To Optimize PPC Campaigns
Smart Bidding allows you to “set and forget” your new or existing campaign when managing your PPC campaigns. This means you don’t have to keep track of all the data and search queries related to your campaign. Instead, allow Google’s advanced machine learning to handle most of the guesswork and the necessary adjustments to maximize your ad spending.
If you don’t have the resources or skills to track conversions or provide an optimized bidding amount manually, this is one of the strengths of a Smart Bidding strategy.
Google Smart Bidding Cons
1. Lack of Transparency
Google’s advanced machine learning has access to more data than most advertisers do. While it can be an advantage to fine-tune a campaign’s bids, it also becomes a disadvantage if you want to track performance. If you’re interested in looking into the granular performance of each keyword, you’ll find that a lot of the data is limited. What’s more, you can’t totally tell what goes into each bid adjustment.
2. Less Control Over Bids
It’ll be a while before machine learning is perfected, so there’s still a chance of mistakes like Google’s broad data and keyword bids not matching your own target audience. After all, Google might not quite understand your business the way you do.
This poses a problem when you see a need to tweak your bids based on your own findings. Using Smart Bidding means leaving the work to machine learning, regardless of what you know about your website’s historical online conversion metrics. Thus, you have less control over managing PPC campaigns and PPC management.
3. Requires Some Amount of Data
Google Ads claims that Smart Bidding can work even on new campaigns without data. However, this can only work if you have other existing campaigns that can get data. And to get accurate results, you need your data to meet the threshold for a minimum number of conversions.
Should My PPC Campaign Be Using Smart Bidding?
Think of choosing between Smart Bidding, automated bidding and manual bidding as buying a car. In this case, Smart Bidding is buying a car and then getting a driver to drive it for you. This is a great option for those who don’t know how to drive a car but want to go to a certain destination with it. But in the long run, you still don’t know how to drive.
The same applies to Smart Bidding. Smart Bidding is a good option for small businesses to optimize their bids and put their ads up there for brand awareness, traffic and conversions. But this isn’t a long-term solution, as your campaign only relies on what Google thinks your campaign can benefit from.
Over time, once the metrics and data from your Google Ads agency account are enough to make solid observations, you can start to control your own bids and optimize your PPC campaigns. There are some advantages to manual bidding or using Google Ads’ automated bidding. Google has a broad and general view of your keywords, but you know your campaign goals and target audiences better. In this case, it’s best to have human insight when navigating your campaigns. This is where a PPC ads agency is particularly beneficial.
Optimize PPC Campaigns With the Google Ads Specialists at Thrive
At Thrive, we optimize our clients’ PPC campaigns for the best results. So whether your goal is to improve visibility, brand awareness or increase conversions, we can work with you and your Google Ads agency account to deliver results and put you in the spotlight for keywords that matter.
For cost-effective marketing strategies, work with an online advertising agency with years of experience and a thorough understanding of how to leverage your PPC campaigns. Contact us today for your free proposal for our PPC management services.
