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Welcome to the second installment in our Value-Based Bidding (VBB) series. If you missed it, the first post was an introduction to Value-Based Bidding (what it does, how it works, and why you should care) and you can catch up here before checking out our VBB Best Practice Guide below!
Value-Based Bidding can help you scale and improve your advertising, but to truly get the most out of it you need to follow some best practices. We’ve done the leg work for you and compiled a list of them so you don’t have to waste your time scouring the SERPs for answers.
Good news! There are just six principles you’ll have to stick to. They are
When these principles are applied, you’ll set your company up for long-term and short-term success.
Sharing data that’s relevant to your business goals and not your marketing objectives will help you grow and succeed (we know they’re not always the same thing!). Ensuring this data is accurate will allow you to get the best results possible.
Quality data isn’t just about what you measure. It’s also what you shouldn’t measure (or evaluate). Periods of poor data and no data should be excluded. It’s not uncommon for conversion tracking to break due to website updates, accidental code removal, and other issues. You can only consider your data high quality when you confirm everything is working correctly.
Assigning value data to conversions gives them weight. If you make a page view a value of 1 and a form fill a value of 5, then Google will understand more about your goals. Think about this like customer surveys where you assign a value or weight to your thoughts. (You know those oft-used 1-is-worst and 10-is-best scales). By pulling micro conversions into the data stream, you’re teaching Google’s machine learning the path to your customers.
These conversion values can take two forms. They are static and dynamic. A static conversion value is a value you assign to the conversion, and it stays the same all the time. A dynamic conversion changes based on your parameters. For instance, a dynamic value is the transaction value of a purchase. As you can see, setting these up correctly will help you understand the true value of your ads.
The last core principle touches on your Smart Bidding settings. Your setup should be aligned to your goals; i.e. don’t choose maximize clicks and then expect your outcomes to be revenue or leads.
Some advertisers still don’t trust smart creatives, but did you know that more than 75% of advertising impact is determined by creative quality? (Marketing Land). Using smart creatives, a.k.a. responsive search ads (RSAs) and responsive display ads (RDAs), gives the AI many possible creatives that can be personalized for each circumstance.
While attribution may feel like an unimportant part of managing Google Ads, it’s actually a huge part of the process. This is how Google Ads places conversions in the user’s journey. Last-click attribution is incredibly limiting when it comes to a holistic view of data.
When you use other attribution models, especially the data-driven model, Smart Bidding evaluates the customer journey through all the touch points. It then prioritizes those it finds most impactful in the process.
The data-driven model uses machine learning to decide how much credit interactions get. This is done by using data from your account to understand which touchpoints are most important to the conversion. Then credit is assigned based on each keyword’s contribution during the customer journey. This model isn’t static. It learns over time based on the actual performance of your account. According to Google, using this model leads to 5% more conversions with a similar cost per conversion.
In the panic about cookie deprecation, you’ve no doubt heard plenty about the difference between first and third-party data; first-party data is your data, and it’s the most crucial set of insights you can provide to Google’s machine learning. It offers vital signals for Google Ads Smart Bidding’s machine learning, Google calls them audience signals. You can help the machine learn by:
Your audience lists give Google more data to leverage and give you more data to analyze in your reports.
It seems counterintuitive, but it’s also still true – marketing goals don’t necessarily equal business goals. CEOs and executives are constantly saying they don’t want the “into the weeds” answers marketers usually give because it’s hard to connect the dots on larger company outcomes. You’ll be happy to know Value-Based Bidding will put an end to these heated meetings.
In the past, it’s been difficult to optimize for anything other than marketing goals, which leaves a gap between your marketing and the outcomes you need to succeed in the business world. With Value-Based Bidding, you teach the platform what’s essential to your company.
You’ll concentrate on revenue and profit instead of clicks and conversions.
By adding numerical values to your conversion goals and uploading offline conversion data, you can teach the Google Ads AI to work smarter. You can drive qualified leads and decrease wasted spend. This will allow you to create more effective ads and increase revenue.
Your sales team will love the change in quality! Sales and marketing departments will need to find something new to argue over ????.
Since you’ve told the AI what you’re looking for and added the relevant data, it will bid based on closed leads rather than “conversions.” This means your budget will be focused directly on your objectives, with less spending on clicks and conversions that don’t turn into clients.
Using automation, you can train Google Ads Smart Bidding to optimize for predicted CLV. You can even use predicted CLV as a conversion value and add it to reporting. Utilizing this metric also enhances your budget allocation and boosts the effectiveness of your ads.
Another set of objectives we haven’t been able to differentiate well in the past is new versus returning customers for e-commerce. Google Ads has made that easier by allowing us to customize our campaign settings for this purpose. By default, your campaigns will target both new and current customers. But, if you want to focus on new customers or give them more weight, you can check a box and upload your customer list (must have at least 1000 users in the list).
What’s the upside to this? If new customers are worth more, it pays to focus more of your budget on acquiring them.
Following these best practices is, for many of us, a newish ‘How-To’ for setting up campaigns. However, when you follow them you’ll get better results that can be connected directly with your bottom line, and ultimately as a marketer, that’s the core of our role for the companies we represent. While this change in thinking (and setup) can feel a bit overwhelming at first, you’ll certainly breathe a sigh of relief whenever you have to discuss performance with stakeholders!
We love talking PPC and spend most of our time chatting with agencies, so if you have a question please do drop us a line!
Also, Adpulse comes with a 14-day free trial, and right now the first month is only $19.99/mth, so it’s a low-risk way to try it for yourself. Sign up now!
