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Directional Bidding 101

Look, I get it. You want control. You want to do it your way. You want to be in the system, fine tuning and optimizing to your heart’s desire. You want to know that it was your effort that got you or your client the money. We’ve all been there! However, let me be the first to tell you that the Google bidding platform is no place for ego. When it comes to bidding strategies, there is a place and a time for total control, but there are also many opportunities for automation that you need to take advantage of if you are going to continue to manage more and more Google Ads.

Google, as a company, is pushing automation bid strategies more and more as they evolve and fine tune their own platform. If you’ve ever spoken with a Google rep for more than ten seconds, then you’ve heard the words “Target ROAS” and “Target CPA” at least a dozen times. An automated bid strategy can really help you scratch that itch, if you are willing to give it a try.

This can be a dangerous game to play, you might be nervous to put your money or your client’s money in the hands of Google… you’re not wrong to feel that way. They are a business after all, and they are here to take your money and as much of it as they can. However, the only thing scarier than trusting Google with automated CPC bids is handling those bids on your own with a manual bid strategy, especially if the campaign you’re looking to optimize has a large number of keywords. That’s why automated and directional bidding at regular intervals can improve accounts with simple changes made in bulk across many keywords.

Before we dive in too deep… Let’s answer the question… What is directional bidding? Directional Bidding - is the process of using layers of filters (usually at the keyword level) to make bulk changes to push keyword performance towards a given benchmark KPI

In order to fully take advantage of directional bidding you will need active conversion tracking and solid KPIs (usually based on product margins). 

Let’s consider this example in order to full demonstrate the benefits of directional bidding...

  • Stacey has an account with many, many keywords, and she has a manual bid strategy. 
  • Instead of looking at each keyword one by one, she can use one or more filters to isolate some fraction of the total keywords based on performance indicators. It is worth noting that if Stacey chooses to go down this route, she must take some time before diving in to really think through and establish those performance indicators, as they will become a very important piece in providing the direction that the directional bidding will take. 
  • Let’s say her goal for a non-branded is a return on ad spend (Conversion Value/ Cost) of 2.00, but her non-branded keywords are yielding a return of 1.5 on average. She can create a filter to isolate poor performing ads.

How does one create such a filter? Great question!

  1. First she sets her date range. If she hasn’t optimized the account before, she should look at the past few months to get a good idea of what has been happening and where she wants her campaigns to go.
  2. At the keyword level, she clicks on “create filter”. 
  3. She fills in her KPI for the filter (i.e “keywords with a conversion value/ cost < 2). This establishes the rule that all of the selected keywords will live by.
  4. Using the check box, she selects “all filtered keywords” to include all of the keywords that she has specifically selected with her filter.
  5. She changes the max CPC bids on the selected keywords by a percentage factor, say 5-10%.
  6. That’s it! When Stacy does this at regular intervals, say every 2-4 weeks, the account is constantly focusing spend less on inefficient keywords. The process shifts any focus away from poorer performing keywords, and therefore allows better performers more chances

Although this is not a completely hands-off approach to keyword bidding, it does allow you to minimize the time you spend in each set of keywords. You still have control over your domain, and you can totally claim that the amazing performance was due to your brilliant bidding strategy. It’s the best of both worlds!


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