Episode 11: Google Bidding – Automated vs. Manual

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Today we are answering the question “when does Rubato use Manual Bidding and when do they use Automated Bidding on Google Ads?”

It is no secret that Google has recently pushed for Automated Bidding and has shied away from Manual Bidding. If you think about it, it makes a lot of sense why this is starting to happen.

There are 3 reasons Automated Bidding makes a lot of sense, and there are 2 key reasons Manual Bidding still makes a lot of sense – let’s break it down.

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What Is Automated and Manual Bidding?

So just for a quick recap, let’s cover what Automated Bidding and Manual CPC Bidding is. 

Manual CPC Bidding is a Google bidding method “that lets you set your own maximum cost-per-click (CPC) for your ads. This differs from automated bid strategies, which set bid amounts for you.” Essentially, you choose the maximum amount of money you’d like to spend for each click and you have the flexibility to determine which keywords are more profitable for you and act on them.

Automated Bidding is a newer Google bidding method “that automatically sets bids for your ads based on that ad’s likelihood to result in a click or conversion. Each type of automated bid strategy is designed to help you achieve a specific goal for your business.” With Automated Bidding, there is no manual updating and it does all the heavy lifting for you.

 

Why Automated Bidding Makes Sense

Now that we know what these are, we can cover how both methods can actually help you. With Automated Bidding, there are 3 reasons it can be beneficial, 2 of which are in the advertiser’s favor and one of which is in Google’s favor. 

Google image from Jemsu.com
    1. Automated Bidding tends to spend more efficiently. You can spend $1 and make more on this type of bidding than other types of Manual Bidding. ROAS and Conversions will also be higher with Automated Bidding, especially with eCommerce brands. There are caveats to this, but we will cover that in a minute.
    2. The types of campaigns you can set up with Automated Bidding are diverse within the funnel. Within Automated Bidding, there are Maximized Conversions, Target CPA, Target ROAS, and even bid per impression share and CPM (Cost Per Thousand) that can help you spend efficiently. At the top of the funnel, we use campaigns like Maximized Conversions, and lower in the funnel we use a lot of Target CPA. Maximized Conversions tells Google to “spend as efficiently as you can”. It brings a lot of conversions, so it typically has a higher cost. Target CPA is our favorite because it is much more niche. It tells Google “I can only spend $X on this conversion, so go out there and get any inventory that it makes sense to bid on for us at this cost”. Here, the volume is lower, but it works like a charm if you have data and have a controlled cost.
    3. It frees up inventory and brings more efficiency. This one is definitely in Google’s favor because as the inventory is more efficient, the more free the inventory for other advertisers. Diversification not only helps Google’s long-term business goals, but it helps users to not see the same thing which is also good for the business. For the advertiser, however, Automated Bidding makes sense from a pure ROAS (Return on Ad Spend) and efficiency standpoint.

 

Why Manual Bidding Makes Sense

Alright, so now for Manual Bidding. We know, anything with “manual” in it doesn’t sound the most fun, but there is huge value here we promise.

1. Manual Bidding makes for a mature funnel. When you’re bidding on keywords that are high in the funnel like Non-Branded Search, Youtube, Display, etc. – it is not where you’re expecting an impulse buy. Essentially, you do not expect efficiency from your spend. Ex: If you’re selling blue pillows and people search “blue pillows”, it is probably not going to end up in a direct sale. In Automated Bidding campaigns, Google wouldn’t even show such an ad because it knows people are probably not going to buy unless they have data on that through machine learning.

But, in Manual Bidding, you have the freedom to overwrite this and say no. You can still show your ad, even if you know they are not going to buy it. This is good to build up your funnel maturity so all customers at all stages in the funnel can interact or even see your ads. Automated Bidding will cut out all of the unnecessary searches to free up their own inventory and higher ROAS. However, that cuts out the middle part of the funnel and maybe a little too optimized. Building up your funnel is just as important, so keep that in mind.

2. Impression share is key to have in your strategy. Very similar to reason #1, you want to look at platform metrics and make sure you are getting impression share up! We’ve run Maximized Conversions up against Manual Bidding and what happens is ROAS on Maximized Conversions will be double, but impression share will be half. This goes back to the same concept of building up your funnel. Using this same example, on Manual, impressions will be double, but the ROAS will be half.

 

 If your impression share is lower, that means someone else’s impressions are higher. The only way to control this is through Manual Bidding to keep a good grip on your impressions in your audience.

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So there you have it! Manual bidding is still useful for those two reasons and it is good to keep both in the mix to maximize your funnel maturity, ROAS, and efficiency. 

If you need help brainstorming, we are happy to check out your campaign and see where we can help so drop a comment below or tap that chat button!

 

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