Last Updated on: 21st February 2024, 09:27 pm
Can you trust Google to consider your best interests, or should you manually tweak every bidding setting? Today, I’ll walk you through everything you need to know to make an informed decision: should you use automated Google bidding?
Let’s find out!
Manual vs Automated Google AdWords Bidding: What’s the Catch?
There’s a good reason why I always tell my PPC consultancy clients that they should carefully evaluate if they want to bid manually or automate their Google Ads bidding.
On the one hand, Google has access to data you can’t possibly get.
It feeds the data into the automated bidding algorithm to help you reach specific goals.
However, if your tracking isn’t set up correctly and you’re not 100% confident in what you’re doing, you could lose money with improper bidding automation.
Before deciding whether to use Google Ads automated bidding, take all the personal factors into account:
- Your Google Ads account size – Do you only run a handful of ad groups for a single campaign, or do you have a multi-campaign account structure?
- Your goals and data – Do you have enough data to create goals corresponding to the automated bidding strategies? For example, if you know your cost per acquisition, then the automated target CPA strategy might be a good fit.
- Time and expertise – Do you have the time to adjust bids for each keyword manually? Do you know when to change them? Conversely, is your keyword targeting set up so automated bidding won’t waste your budget?
Great automation will elevate your Google Ads account. Unfortunately, there is a darker side to it. For example, one of my clients accidentally left an automated setting ticked on, resulting in thousands of dollars wasted.
On the other hand, I’ve worked with clients who saw 300% ROI increases because of automated bidding.
Cons of Google Ads Automated Bidding
Key Google Ads Automated Bidding Con: Forget about Transparency
Since your bids will vary with automated bidding, you won’t be able to review every single bid.
For example, Google may choose to bid $1 for a keyword once and then $30 another time. Their algorithm uses too many data points to convey through your Google Ads account.
Unfortunately, this means you get very little control. Automated bidding can blindfold you if you want to review your performance in detail, as is the case with many automated offerings from Google Ads, such as Smart Campaigns.
Similarly, if you want to understand how changes affect your account in real-time, you’ll need to circumvent Google and use tools like SpyFu.
Google needs data to optimise your account, but gathering it takes time. You’ll need to supplement it with manual research if you want to act on changes faster.
Is Your Tracking Set Up Correctly? Google Only Monitors Pixel Data
Suppose you choose the “Maximise conversions” automated bidding strategy. Before launching it, you’ll need to ensure your Google Ads conversion tracking is set up exceptionally carefully; otherwise, Google may disregard some information and waste your budget.
Similarly, Google only uses data it can get from your website. If you have additional data on your conversions (e.g., phone call information), Google’s automated bidding won’t be able to consider it.
This is not a problem for an internet-first business like SaaS advertising on Google, but it could get complicated if you have a lot of local traffic.
Google AdWords Automated Bidding Needs Significant Data Volume to Make Decisions
As advertisers or Google Ads experts, we can make decisions based on different information. As an algorithm, Google’s automated bidding only has data at its disposal.
To make the right decisions, Google’s algorithm will need data – and a lot of it.
For example, in the “Maximise conversions” automated bidding strategy, you’ll need a significant conversion volume tracked accurately to increase ROAS.
Volume isn’t a problem for a big advertiser. But if you’re a small business that wants to start using Google Ads?
It’ll take time.
Google Wants to Make the Most of Your Daily Budget with Maximise Conversions and Clicks
There’s nothing wrong with making the most of your daily budget, but automated bidding sometimes leads to Google forcibly spending your budget paying for leads more than what’s necessary.
A great way to ward against this is to set your Max CPC, i.e. the maximum amount you want to pay for each click. Still, it will require some research on your part to define the limits.
I also recommend keeping your daily budget lower than you’d like as you test the “Maximise Conversions” and “Maximise Clicks” strategies.
Key Google Ads Automated Bidding Con: Paying for Impressions You Don’t Need
Unless you have a significant budget and want to generate Coca-Cola levels of awareness, I never recommend using automated bidding for Target Impression Share.
Since the goal of this bidding strategy isn’t profitability but impressions, it can quickly spiral into paying for impressions that don’t generate significant returns.
(Generally, I recommend using Google Ads to generate high-quality leads instead of casting a wide net.)
Google AdWords Automated Bidding: Pros
Key Google Ads Automated Bidding Advantage: Get Access to More Keywords
Around 15% of Google searches are unique. You can’t find them in your keyword tool, but Google can find them and – with automated bidding – place your ad in front of the right people.
When faced with a unique search query, Google will evaluate if it matches your goal and then bid on (or skip) it.
This is a huge asset, as you may find queries your competitors don’t see.
Automated Google Bidding Uses Additional Data in Real Time
You can’t monitor every single bid – but Google can. And it can take different factors into account before deciding on the CPC bid.
For example, Google’s algorithm evaluates devices, locations, and (perhaps even) previous searches in real time before choosing how much to bid for the keyword.
Again, it pays to be careful – but it can be a great advantage in the hands of a seasoned Google Ads manager.
Google Automated Bidding Saves Time
Time-saving is one of the key reasons why small advertisers choose automated bidding.
If you know what you’re doing even without automation and your account is structured correctly, automated bidding is excellent.
But if you’re new to Google Ads, don’t waste your budget in hopes of letting your account run on autopilot. It takes time to find the best bidding strategy for you.
Should You Use Google Automated Bidding?
If the existing Google Ads automated bidding strategies match your goals (target ROAS, target CPA), consider using them.
If your goals don’t match the strategies available, you don’t have enough data or proper tracking, or you can’t afford to give Google a few hundred dollars to experiment with bidding, skip it. Just like with auto-applying recommendations, take Google’s suggestions with a grain of salt.
But no matter what you choose, consult an expert. If you’re a new advertiser and want to do everything on your own, get a copy of my best-selling Google Ads book to launch a successful campaign in 7 simple steps!
Automation is excellent, but make sure you know how to review its performance. With the correct Google Ads information, you’ll drive more top-quality leads into your funnel!