When I first learned how to ride a bike, I remember being scared. It was a daunting process because I'd never done it before and was terrified of falling.
I actually remember feeling similarly when I first started getting into paid advertising campaigns at the marketing agency I worked at. The first time doing anything can be an intimidating process.
But as a marketer, it's important to understand how to set up your paid advertising campaigns so you get the most out of your budget.
To do this, you can use several types of bidding strategies for different types of ads.
Below, let's review the bidding strategies that will drive results when you use Facebook ads and PPC/Google Ads.
Facebook Ads Bidding Strategy
When you're just getting started with Facebook Ads, it's not easy to figure out what strategy to use.
Luckily, Facebook has a guide that explains the different bidding strategies you can use. Let's dive into those strategies and figure out how to determine which one is right for you.
1. Lowest Cost (Auto Bid)
With this strategy, you won't have a lot of manual work to do. In fact, Facebook is the one who sets up the bid automatically.
If you want to spend your full budget, this is a good choice for you. It's a hands-off strategy and you can get more bang for your buck while spending your budget.
So, how do you know if this is a strategy you'd want to implement? Well, this is a good idea if the goal of your campaign is brand awareness, impressions, traffic, post engagement, or lead generation.
2. Bid Cap
This strategy is slightly different because of the manual processes. For this one, you'll be the one who sets up the bidding.
This is a good option if you want more control over the cost. In fact, with this strategy, you might not even spend your full budget.
This type of strategy works for the same types of ads as the lowest cost strategy, it's just more manual and gives you more control over your spending. Plus, it can help you increase competitiveness against other advertisers.
3. Cost Cap
If the goal of your ads is traffic, event responses, offsite conversions, or lead generation, then this is a good option as well.
With this strategy, Facebook sets the bidding while you determine the maximum amount you're willing to spend.
You could use this type of bid strategy if you want to maximize cost-efficiency and keep cost within a certain threshold.
4. Target Cost
Another semi-automatic option, this strategy will allow Facebook to choose the bid while you set a target price. This is the price that you'd like to strive for, but Facebook could over or underspend slightly.
If you want to maintain a consistent cost, this is a good strategy to look into. You'll be able to predict your cost and get the most conversions possible at your target cost.
However, it's important to keep in mind that you could lose out on other cheaper options.
This is a good strategy if the goal of your ad is traffic, lead gen, or conversions.
5. Value Optimization with Minimum Return on Ad Spend (ROAS)
If you set your objectives to app installs, conversions, or catalog sales, then this is an interesting bid strategy to consider.
With this strategy, Facebook sets up the bid that's specific to optimizing value. If you're using ROAS as the primary metric of success, this is a good option.
This bid strategy will focus the campaign on the bottom line, so you get the most opportunities while maintaining a minimum ROAS.
6. Highest Value
If you want to spend the full budget and get the highest ROAS, then this is a good bidding strategy.
It's hands-off, meaning Facebook manages the bidding. You can spend your budget, while achieving the highest value results.
This is a good strategy if the goal of your ad is app installs, conversions, or catalog sales.
Now that we know more about Facebook ads bidding strategies, let's dive into strategies you can use with pay-per-click (PPC) ads, whether it's through Google or another search engine.
Google Ads/PPC Bidding Strategy
Similarly to Facebook ads, getting started with PPC ads can seem like a difficult task if you've never done it before.
Before you review the options for Google bidding strategies, it's important to understand how to build a campaign.
In the video below, HubSpot Academy reviews how to build your first Google Ads campaign and explains how the Google Ads auction system works.
Now, let's dive into the options that Google has for bidding strategies.
1. Manual Cost Per Click (CPC)
Similar to the manual strategies for Facebook, if you want to have more control over the cost and spend, this is a good strategy for you.
With manual CPC, you select the price that you're willing to pay for each click. Then, Google will ensure you never spend over that amount for a click.
2. Target Cost Per Acquisition (CPA)
With this strategy, you can set a target CPA that lets Google know how much you want to spend on producing an action.
According to Google, "Using historical information about your campaign and evaluating the contextual signals present at auction-time, Target CPA bidding automatically finds an optimal bid for your ad each time it's eligible to appear. Google Ads sets these bids to achieve an average CPA equal to your target across all campaigns using this strategy."
With this set up, you pay for conversions rather than clicks.
3. Target ROAS
Similar to the ROAS strategy for Facebook, you can determine how much you want to get back from your ad spend with PPC ads as well.
This is a great strategy to use if you want to get more conversion value at a target ROAS that you've set yourself.
4. Maximize Clicks
Sometimes when you set up a PPC campaign, all you care about is maximizing your clicks.
When that's the case, you can use this strategy to let Google adjust your campaign automatically to get the most amount of clicks.
This is the simplest, most straightforward way to bid for clicks. All you need to do is set your average daily budget and Google will do the rest.
5. Maximize Conversions
On the other hand, if conversions are the main metric you're using for success, you might want to look into a maximize conversions strategy.
With this strategy, Google will focus on optimizing your bid strategy to help you get conversions.
This is a good strategy to use if you want to spend your entire budget while getting the most conversions possible.
6. Target Search Page Location
If you want your ad to rank in a specific place on the search engine results page, this is a good strategy to consider.
Google will optimize your bidding strategy to get your ad to show up in a specific place.
7. Target Outranking Share
With this type of strategy, Google allows you to choose how often you want to outrank your competitors.
This is a good strategy if you're focused on increasing the competitiveness of your ads.
8. Enhanced CPC
With this strategy, you can automatically adjust your manual bids to try to maximize conversions.
This is just an enhanced version of the manual CPC strategy. If you're testing out CPC ads, this is a good strategy to learn more.
Ultimately, you should experiment and figure out which strategies work for your business. Even if you do an automatic bidding strategy, you should watch it carefully and monitor the results.
Originally published Aug 28, 2020 4:00:00 AM, updated August 28 2020