OK…do you want to harness the power of Enhanced Campaign Bid Modifications without spending a ton of time and effort? Have I got a trick for you :.)
First, you need to have a large data sample…you don’t want to make such important changes based on minimal data.
In your campaigns, you’re going to have account data that looks something like:
Pretty basic stuff. Note that I’m using “Day of Week” dayparting as my post example here for the sake of brevity, though you can apply this trick to “Hour of Day” dayparting as well as Geo Bid Modifications.
Here, the average CPA is $3 but the range of CPAs is from $2.45 (low) to $4.26 (high). So…then I say to myself…by what % does each daily CPA deviate from the average?
OK. If we look at (Sunday) as an example, we see that the CPA is 51% higher than average CPA. Higher CPA’s aren’t good…they’re bad. So, to get our correct and final day of week bid adjustments, we’ve got to make the positive numbers negative and the negative numbers positive.
Please note the following:
1) I showed you a “Day of Week” example because it was easiest. However, in my experience, the Geographic Bid Adjustments are much more powerful than either “Day of Week” or “Hour of Day”. Even better, the Geographic Bid Adjustments are currently supported by AdWords Editor (the others aren’t), meaning you can quickly output all your Geographic Conversion Data, figure out how much the CPA for each Geo deviates from the average, and calculate your bid adjustment all in Excel in a matter of minutes (before uploading via AWE). Hopefully, AdWords Editor will soon support the other types of bid adjustments as well…making the changes in the UI is pretty slow.
2) Are these the absolutely optimum bid modifications you can make? Probably not. I bet someone who can fuse calculus and advanced statistics together could create a model superior than mine. After all, there isn’t an exact correlation between the bid modification and the effect on CPA.
However, I feel confident that this process can get you 85-90% of the optimum result in a relatively few minutes of work, and that’s pretty darned good in my book.
Also, please note that after your initial set of bid modifications have been live for a while, the relative percentages of each data segment will change so that revisiting this process periodically and making changes is absolutely appropriate.
Every account is different but when I’ve done major Geo Bid Modifications before, I’ve seen conversion rates go up in excess of 20%.