Visable 360
The B2B magazine for digital sales
Visable 360
The B2B magazine for digital sales

SEA trend of Smart Bidding: automatic bidding strategies

Can SMEs, too, use artificial intelligence (AI) for their B2B marketing? Yes – and it’s easy with Google Ads. That’s because Google has heavily invested in machine learning and is now leveraging this in Smart Bidding. But what can the smart advertising do for you? And which strategies promise the most success?

People are bidding on objects

What is Smart Bidding and where is it used?

Potential buyers send out millions of signals with every Google search that are impossible for a single person to interpret and consider. So how does a company know which search requests make sense to bid on for a Google Ad? The answer: Smart Bidding. With this Google technology, advertisers can optimise the analysis process and, thanks to machine learning, optimise their ad campaigns. To achieve this, the AI-controlled advertising uses various bidding strategies: smart campaigns. Companies can therefore save time and generate more conversions, sales and leads. Particularly suitable for Smart Bidding are performance-driven campaigns. Small and medium-sized enterprises, above all, can profit from this SEA trend – thanks to a more effective administration of campaigns and context-driven ads.

Smart Bidding: the SEA trend in 2020

Over the past few years, Google has been aligning its Ad Manager more and more to automated processes. Ads should be more effective. Especially in the past few years, many positive experiences have been made with this and many see Smart Bidding today as indispensable. Smart Google Ads analyse, for instance, not just end devices and keywords, but also where people are surfing and at which time they are more receptable to advertising. The work for this is done by the self-learning algorithm, which also optimises itself. It’s no wonder, then, that Smart Bidding is one of the biggest marketing trends in 2020.

Over the past few years, Google has been aligning its Ad Manager more and more to automated processes. Ads should be more effective.

At a glance: a host of Smart Bidding strategies

If you want to use Smart Bidding, you first have to select a bidding strategy. Four are especially important for companies:

1. Maximise conversions using Smart Bidding

The Google algorithm for this bidding strategy focuses on achieving as many conversions as possible within a predefined budget. This also works with low budgets and few conversions. The cost per action (COA) and the return on advertising spend (ROAS) do not play a role here.

2. Maximise conversion rates using Smart Bidding

The goal here is to maximise the overall conversion rate of your campaign within your budget. When you define your conversion tracking, you define which rate you want to increase, such as sales. The bids are then adapted individually for each auction, so that you must reckon with a possibly high cost per click (CPC).

3. Leverage Smart Bidding for CPA

How much do you want to spend per conversion? You define this using the CPA as your goal. This strategy is suitable for small campaigns, too – but only with one conversion goal, such as contact with a sales manager. Several goals could confuse the algorithm, so that it only focuses on the goal promising the most success – not on the goal most important for your company, for instance on newsletter subscriptions instead of lead generations.

4. Leverage Smart Bidding for ROAS

In this case, you can define the type of conversion that is most important to your company. The algorithm then focuses more strongly on this campaign goal with the aim to profitably realise it. This works especially well for online shops and many conversions. The focus is on profits you ultimately make and less on the cost for the conversion. Good conversion tracking is particularly important here.

Smart Bidding: dangers, too, lurk

The Smart Bidding algorithm first has to learn. Which is why Google recommends a learning phase of at least seven days. When it comes to more complex and bigger campaigns, it is recommended you take two to four weeks, whereby you don’t change anything during this time. Optimise your goals in small steps. If you make any big changes, the algorithm has to once again go into a learning phase. With Smart Bidding, Google Ads become less transparent in terms of what they actually are doing and the performance of individual keywords. For this reason, you should give conversion tracking even more attention. Possibly, you may even want to verify the results using A/B testing with manual campaigns.

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