AI and machine learning are becoming an integral part of advertisers’ bidding strategies. But applying automation to your brand’s campaign and strategies is by no means a quick fix. It adds a layer of complexity that can be a powerful tool to improve your digital ad performance when combined with smart reporting and data management.
In a recent webinar, Lew Brannon, Growth Media Strategist at Tinutii, and Anna Shutko, Product Marketing Manager at Supermetrics, discussed:
- The power of Google’s ad tech combined with human intuition
- The way automation has changed bidding strategies
- How advertisers can leverage those innovations through the WISE approach to automated bidding
Here are the key takeaways from their discussion.
What are Google’s automated bidding options?
Google offers two automated “smart” technologies for advertisers: Smart campaigns and smart bidding. The two are often confused, so let’s dive into what each one entails.
Formerly called AdWords Express campaigns, smart campaigns are fully automated campaigns that remove all the targeting options that you typically have in a standard campaign. Smart campaigns have a low barrier to entry as they require minimal ongoing management, more or less allowing Google to run the campaign for you.
There are two types of smart campaigns offered through Google Ads: Smart Shopping campaigns and smart campaigns.
Smart Shopping campaign placements include:
- Google Search Network
- Google Shopping
- Google Display Network (GDN)
- Google App
Smart campaign placements include:
- Google Search Network
Like any new ad technology, there are pros and cons to smart campaigns. The biggest pros are that smart campaigns take a lot of the work of creating and maintaining off your plate by automating every piece of your campaign and using auto-bidding.
While automation can be a huge time saver, those same features also present some downsides. Smart campaigns offer you little control over your campaigns, making you fully relying on technology. You also only have access to limited analytics with smart campaigns.
Smart bidding, on the other hand, refers to the suite of automated bidding strategies offered by advertising platforms like Google Ads and Facebook Ads. Smart bidding strategies allow you to take advantage of your Google Ads campaigns by setting targets for your results, which Google will automate your bidding to meet.
Smart bidding strategies set by Google
Google offers six different smart bidding strategies:
- Target CPA (cost per acquisition): Google will manage your bids so that you get as many conversions as possible at that target CPA.
- Target ROAS (return on ad spend): Google will try to give you the most revenue possible within your budget.
- Maximize Conversions
- Enhanced CPC (cost per click)
- Maximize Clicks
- Target Impression Share
Brannon recommends focusing on target CPA and target ROAS for the best results. Target CPA is a great strategy for a smaller catalog with low variance in price points and a high sales volume, such as cosmetics. Target ROAS is better for catalogs with highly variable price points or a wider variety of products.
No matter which smart bidding strategy you use, here are some of the key considerations that Brannon recommends to make the most of your automated bidding options:
- Smart bidding and smart campaigns only work within a broader strategic framework based on core business goals.
- Account structure is key, so make sure you group keywords and targeting based on shared themes, goals, funnel stages, etc.
- Structure your campaigns based on funnel tactics. For example, retargeting and prospecting should be separate campaigns, as should acquisition and re-engagement.
- Use shared budgets and portfolio bidding strategies.
- In place of the time and resources, you would spend on real-time bidding, supplement your workflow with key reports and tools to make sense of performance and equip internal stakeholders with big-picture takeaways.
A WISE approach to smart bidding and campaigns
At Tinuiti, we recommend using a WISE strategy: Winners, Increase, Suppress, Everything else. The WISE approach involves segmenting your Smart Shopping campaigns into four different campaign types based on the performance of your products. The WISE approach uses the target ROAS bidding strategy, so you can focus on maximizing your return on ad spend across product types.
Winners: These are products you want to dedicate the most budget to and bid most aggressively for. These are your top converters, “hero” products, and loss leaders. Set a 250% target ROAS for this campaign.
Increase: These are products you want to increase visibility on, often because they are in-season or new additions to your catalog. If you find Google is ignoring any of your products, this category will help. Set a 300% target ROAS for this campaign.
Suppress: These are products you want to spend less of your budget promoting, such as costly, non-converting products. Past-season and outlet products fit well here. Set a 1000% target ROAS.
Everything else: This category is for any products that don’t fall into Winners, Increase, or Suppress. Set a baseline bid for these that aligns with your overall goal. We recommend a 400% target ROAS.
Why use the WISE approach?
The WISE approach lets you better pinpoint a target ROAS for each campaign, rather than lumping all of your products into one Smart Shopping campaign. When you separate campaigns by product performance, you can better segment bidding and budget. This also lets you take back some of the control that an automated technology like Smart Shopping takes away.
All in all, a WISE approach to automated bidding lets you take advantage of the benefits of Smart Shopping more efficiently.
How to leverage data analysis and reporting for your automated bidding campaigns
As we mentioned earlier, one of the key pieces of a successful automated bidding strategy is data analysis and reporting. Here are Shutko’s recommendations for building your data strategy:
- Put in the groundwork to develop a data strategy. Ask yourself: What data do we have? What data are we missing? Who will be using these reports? Where will we pull our data from?
- Choose a tool that serves a specific reporting purpose.
- Create the first draft of your reporting dashboard, then share with stakeholders. Adjust your report based on feedback.
- Same time by reusing your dashboards as templates instead of starting each dashboard from scratch.
“Now we’re more concerned now about portfolio management of all of our budget and bid strategies. We’re looking at media mix modeling, and we’re looking at the holistic strategy. How’s omnichannel performing? How can we create these custom flexible solutions for reporting and data visualization? We’re analyzing our creative across all channels and how that plays into our search campaigns and our shopping and display. And we’re constantly looking at ways to evolve marketing automation.”
– Lew Brannon, Growth Media Strategist at Tinutii
“You can see how our thesis today is more about making sure that you’re adapting to leverage these technologies. And, most importantly, supplementing these smart bidding strategies and smart campaigns with ways that you can see the data and help you continue to tell that story and make sense of everything,” Brannon says.
All in all, here are the key things to focus on to make the most of your automated bidding and smart campaigns:
- Embrace smart bidding within a WISE framework.
- Evolve your skills and approach to match the changes in the industry and the evolution of AI-powered marketing.
- Focus on improving your data analysis and reporting process.
- Learn how to build marketing reports using different tools.
Click here to watch a recording of the webinar and learn more about how a WISE approach can help you leverage Google’s automated bidding technology.