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Manage Search Bidding Like a Machine

Wayne Lieb
Manage Search Bidding Like a Machine Wayne Lieb

When an online search engine campaign fails to deliver the desired results, the first step a marketer usually takes to improve performance is to change bids. However, that is a tactical approach to optimizing search campaigns that often fails to address the underlying reasons for disappointing performance.


Marketers are under pressure to ensure that they are spending the budget efficiently (below CPA goals) and maintaining a respectable volume (ensuring that the desired number of actions is completed). The temptation to focus on bid management is understandable since changing bids is the fastest and easiest way to improve a campaign's CPA performance when a client demands results.  


Take this scenario as an example. You have an allowed CPA of $25 and a target of 1,000 sales. You should spend no more than $25,000 to meet that goal. If you see that you are spending too much with acquisition costs above the budget, you reduce the bid price to lower the CPA. However, this comes at the cost of a lower position on most engines.


You are now getting an excellent CPA (well below the allowable cost), but your lower position on the search engine leads to fewer clicks. You have reduced your CPA at the expense of volume.


Most marketers will respond to that problem by increasing bids, which leads to a higher position on the search engine and more clickthroughs. You notice that you are driving more volume and getting more sales, but at a higher cost that destroys your CPA targets.


This is a vicious cycle of spikes and lows that traps many marketers. The marketer thinks he or she has done everything possible to make the campaign work and even tries to change the campaign. The client deems search marketing a failure and decides to spend their money on other mediums instead.


Best of both worlds


The best way to attack the problem of under-performing search campaigns is to automate bid management and utilize your own time for more strategic matters.


Humans are smarter but computers are faster. Automated bid management brings the best of both worlds to search marketing campaigns -- it allows humans to set bid strategies that are followed by programs that are able to compute millions of possibilities a second and make a decision far quicker than any human possibly could.


Automated bid management applies various rules that help you achieve your positioning and bid amount goals. Be warned, however, that no amount of rule setting will help you if your goals are unrealistic.


Caution must be taken with new campaigns and results need to be monitored very closely. You should only apply your bid management rules once you have tracked what your best converting keywords are, what your bad performers are, as well as which keywords are high in CTR and low on desired actions.


Different rules will apply to different buckets of keywords and it is only by testing that you will know how to achieve optimal results.


So once you have submitted listings that adhere to the search engines' guidelines, gone live with them on your engines of choice and have used an automated bid process, what can you do to optimize campaigns? Focus more attention on other critical success factors and test results against a broad range of metrics:



  • Measure the results you get from different titles and descriptions

  • Learn what gets you your best CTR and test different landing pages (your landing page is vital in turning a click into a sale/desired action)

  • Ensure that your conversion process is easy and quick to produce the desired results

  • Run surveys and get user feedback that will help you streamline your conversion process.

Many marketers neglect these fundamentals, but they are critical to ensuring the consistent success of a search campaign. Automate your bid management process and focus on optimizing your campaign at all levels.


Additional resources:



Wayne Lieb is director of search marketing at Acceleration. .

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