In this video you're going to learn about the
different bidding strategies you can use for your Google Shopping campaign.
We're going to go through each bidding strategy,
show you the advantages and disadvantages, and when you would use each one in each situation.
Firstly, if you're not sure what bidding means, or how the Google Ads auction work,
Google works on a pay-per-click model.
This means that Google is going to show your ads and your products to people searching on Google,
and they're going to charge you for each person that clicks your ad, and goes to your store.
Your bidding strategy is your way of telling Google how to show your products,
and how much you're willing to pay per click.
Maybe you really care about profits so you can use a target ROAS strategy,
and tell Google to maintain a ROAS of 4 on your campaign.
Google will aim to do this, and show your ads to the people that will try and get you
a target ROAS of 4 on your campaign.
Maybe you just care about getting as many people to your website as possible, in that case
you could use a maximize click strategy, and Google's going to go out and try and get a
huge volume of people looking at your store, regardless of the relevancy of that traffic.
Now, we're going to go deeper into these right now, but if you want to learn more
about the Google Ads auction, and how it works, I have a full video that takes you through this.
I'll leave a link to that down below.
Looking at the bidding strategies that we can use with Google shopping,
there are two main categories:
Automated and Manual.
Automated strategies are when we lean on Google to use their machine learning, and mountains of data.
This can be good and bad, as we'll learn.
It can lead to reaching people we would never have otherwise reached, leading to more sales,
but it can also cost more as the algorithm doesn't know who our customers are,
and needs to go through an extensive learning process.
At the beginning, generally we recommend starting with a manual bidding strategy,
so we can guide the algorithm to focus on what's really working,
and then later switch to an automated bidding strategy once we have enough data.
This does take more time to optimize the campaigns at the start, but it saves you a lot more money,
can get quicker results, and we have a full guide showing you how to do this strategy.
I'll leave a link to that down below.
Here are all the bidding strategies you can use for Google shopping.
Let's go through each one right now, one by one.
First, let's talk about the automated ones, and the most automated of the lot: Smart Shopping.
Smart Shopping is Google's most automated strategy of all time.
It's basically Google's don't think, and let us take care of everything strategy.
If you're watching this video after July of 2022,
feel free to skip past this section about Smart Shopping campaigns.
Google has actually made Smart Shopping campaigns redundant,
and have now introduced what are called Performance Max campaigns.
These are quite similar to Smart Shopping, but with a bit of a different strategy and approach.
We're getting some pretty awesome results with these campaigns for our clients,
and we'll leave some videos below showing how to run and optimize these profitably.
Okay, let's keep going.
Now, I have a full video on Smart Shopping versus Regular Shopping I recommend watching that.
If you haven't, I'll leave a link to that down below.
Smart Shopping campaigns are basically Google's black box bidding strategy, where you
have almost no control over the campaigns, and you receive almost no data from them.
You can adjust the budget, and provide an optional target ROAS to guide Google.
Now, when would we use Smart Shopping?
The rare times that I would recommend Smart Shopping is when you're an absolute beginner
to Google Shopping, and you don't have the time or the expertise to optimize your campaigns.
The other time I'd recommend it is,
when you've tested out manual and other automated strategies, and they've failed.
If this is happening you want to make sure that your store is also optimized for conversions.
We have a series of videos that show you what to do if you're not getting
impressions or clicks, you're not getting sales, or your campaigns aren't profitable.
I recommend going through those, I'll leave a link down below.
If you're going to run Smart Shopping, having a quality store with a high conversion rate is key.
Smart Shopping campaigns definitely simplify the management,
but they come at a cost of control, and insight.
You don't get insight into performance data, search queries,
or even performance of individual products.
You don't know what's working and what's not working, which is terrible if you want to use
all this information to inform the rest of your funnel, and marketing efforts, which you do.
Attribution also becomes more difficult as it lumps the performance of search, display,
and YouTube into one, and there's no way to report on the performance of each separately.
Of course in regular campaigns we see significant variation between each of these mediums.
So we want to measure that and adjust based on performance,
which we can't do with Smart Shopping.
We also can't add negative keywords,
which is a vital part of optimizing and scaling our campaigns.
We also have no control over our products,
so we can't focus on those with higher profit margins, or with better performance.
Everything is lumped into one campaign, and Google has no idea about our product goals.
As you can see there are many disadvantages to Smart Shopping campaigns,
particularly if you have the time to spend on properly optimizing a regular campaign.
They have their place, we just caution you on using them straight away.
Okay, let's now look at the target ROAS bidding strategy.
With this method Google will alter your bids
for you to try and achieve a target ROAS that you've set.
This is a great strategy, if your focus is on profitability and you
have existing conversion data in your account.
For example, if you know that your breakeven ROAS is 2.5, then you can set the target ROAS as 3.
This allows you to be profitable while also getting a volume of sales.
We love using the target ROAS bidding strategy,
but it does require you having existing data in your account.
Google needs to know who your past customers are so they can show to
the right people to hit this target ROAS goal.
That's why we usually start a new campaign on a manual CPC strategy,
get to 50 - 100 conversions per month, and then switch over to a target ROAS bidding strategy.
Keep in mind that when you use a target ROAS bidding strategy
it can be quite sensitive to the goal ROAS that you set.
Don't make changes before big events like, Black Friday because changing your goal sends Google
into a learning phase, which can really tank your conversions leading up to these big days.
Target ROAS is a great strategy overall, just make sure you get conversions first,
otherwise you'll waste a lot of ad spend as Google shows your products to random people
because it doesn't yet know what your products are, and who's going to convert.
It's much more efficient to start with a manual bidding strategy first,
and later switch to a target ROAS strategy.
Plus, you'll save money too.
The next one we have is the infamous maximize clicks.
This strategy sets up your bids to get as many clicks as possible,
within your maximum daily budget.
Let that sink in for a second - "As many clicks as possible for your daily budget".
Maybe you're realizing the problem with this strategy.
Google here is going to see your daily budget say of $50,
and stuff it with the cheapest clicks it can possibly get.
This is a problem, because often the best clicks,
those that convert into customers are expensive for a reason,
and that's because other advertisers know their good clicks and are also bidding on them.
This means that with a maximize click strategy, Google is going to avoid these clicks,
and get you the cheapest clicks, which aren't necessarily going to convert.
As you may have figured out, having thousands of people view your website means nothing,
if they're not potential customers that are going to lead to profits.
For example, if I'm selling power drills on my store, I want to show for people searching for
power drills, but if Google's going to get me cheap clicks for 'drill sergeant memes',
that's not going to be very helpful for me for getting profits.
Now, I know this is an extreme example but this
is why we don't use maximize clicks, unless in rare cases.
That is when we're trying to get as much brand awareness as we possibly can for a store.
i.e. We don't care about profitability,
and we just care about eyeballs, or when we have a multi-tiered campaign strategy
where we want to also target brand queries, with one of the campaigns.
This is a more advanced strategy, and if you're starting out with
Google Shopping campaigns this is not useful for you at all, at this time.
We only do this once we're generating hundreds to thousands of conversions per
month from our campaign, and we want more granularity with search query targeting.
Just know that for now, I don't recommend using a maximize clicks
bidding strategy for your Shopping campaign.
The next strategy we have is the Maximize Conversion Value bidding strategy.
This strategy works by trying to get you as many sales as possible,
not volume of customers, but volume of sales value.
This strategy uses your conversion tracking,
and prior conversion data to try and get you as much sales as possible.
It focuses on sales, which is great, if that's what you're about.
This is a great strategy to test out,
just make sure you have historic conversion data in your account .
We recommend at least 50 - 100 conversions.
Also make sure your conversion tracking is perfectly set up.
This is crucial. 👀
If you haven't set up your conversion tracking properly,
go and check out our full video on how to do this.
I'll leave a link down below.
The disadvantage of Maximize Conversion Value,
is that it doesn't specifically focus on profitability, just volume of conversion value.
Ideally we recommend starting your shopping campaign with manual CPC,
then trying out a target ROAS bidding strategy.
If that isn't working, then test out Maximize Conversion Value.
Okay, now we have our Manual CPC bidding strategy.
This is where you manually tell Google how much you want to pay per click for your campaign.
We can even get more granular and tell Google how much we want to pay per click,
per individual product, and this is where the secret sauce is.
If you keep going through our free Google Shopping course on our website, you'll see that this is one
of the fundamental strategies of building, and scaling a profitable Google Shopping campaign.
We start with a Manual CPC bidding strategy, we focus on the products that are performing well,
get cheaper clicks and cheaper sales, and later once we have the conversion data,
we switch to a target ROAS strategy.
We do this, because we can do it from the start of the campaign
as soon as we start getting those initial sales.
We can also target products that have higher margins,
have more stock, or are performing better with the shopping algorithm.
The disadvantage is that it takes time and knowledge to do this.
Of course, we teach you absolutely everything in our Manual Bidding Strategy video.
After that, you just need to check it regularly.
Usually, once every 1 - 2 weeks to make sure it's performing well.
The more clicks you get, the more data you're going to have and the
quicker you can make optimizations and changes.
Now, once we get to 50 - 100 conversions per
month that's when we can switch over and test out a target ROAS as bidding strategy
Finally, we have the bidding strategy Enhanced CPC.
This is where you use manual bidding,
but let Google use a little bit of their machine learning algorithm.
They'll now marginally increase or decrease your manual bid,
based on whether Google thinks that click is going to convert or not.
It gives you the control of manual bidding while also allowing you to
lean on Google's algorithm, just a little bit.
Google does have a lot of data on its users, so we do like to lean on Google a little bit
at the start, as we're doing our manual bidding optimizations.
Usually, we do turn this on as we run our manual bidding strategy
just to get a little bit of an edge from Google.
There we go guys, they're the different bidding strategies for our Shopping campaigns.
What they are, when we use them.
If this video was helpful, please give it a like and let me know in the comments down below.
As you may have noticed, it's actually part of our free Google Shopping course on our website.
There are over 40 videos showing you how to set up, optimize, and scale your shopping campaigns.
It's 100% free, with no sign up required.
I'll leave a link down below.
Thanks for watching guys.
I'll see you in the next video.
Bye for now.