Google Ads Bid Strategy Update: The End of an Era
August 26, 2021
In the ever-changing digital marketing environment, it shouldn’t come as a surprise to PPC marketers that Google has recently announced an update. This time to discontinue two of its campaign bid strategy settings.
You may have already noticed some changes regarding Google’s bidding strategy options found in your campaign settings. Google is continuing to push smart bidding as a priority. This makes it even more essential for PPC marketers to utilize Google’s automation technologies.
Below, we’ll go over the most recent Google Ads bid strategy update in detail so that you know how to plan.
Bid strategy update: tCPA and tROAS smart bidding options are discontinued
So, what is this change, you ask? On July 22nd, Google announced that it would be moving away from the very popular and often used bid strategies tCPA (Target Cost per Acquisition) and tROAS (Target Return on Ad Spend).
This left only “Maximize Conversions” and “Maximize Conversion Value” as the only conversion-focused automated bidding strategies that Google offers. In the screenshots below, you will notice that the options to choose “Target CPA” and “Target ROAS,” are no longer available for advertisers. Which were present as recently as mid-July,
After the initial bid strategy update announcement and immediate reaction to the news, marketers sigh in relief that this change was not as significant as first anticipated, after further investigation.
Bid strategy recap
Let’s first recap how tCPA and tROAS function in Google Ads. Both campaign strategies rely on Google’s smart bidding technology. This aids in bidding into the Google Ads auction based on thresholds you set.
Target CPA bid strategy allows you to set a goal for how much you want to spend per conversion. The goal of Target ROAS strategy is to meet the highest percent return on ad spend possible. Which is seen at the campaign level.
These two bid strategies will no longer be available for you to choose at the campaign level. However, their functionalities are present within Google’s bid strategy settings. They will just look slightly different.
How does this affect performance?
As mentioned above, Google is going away from its beloved tCPA and tROAS campaign bid strategies. Going forward it’s meshing its CPA and ROAS automation technologies. Each option is now found under Maximize Conversions and Maximize Conversion Value bid strategy types.
At first impression, hearing the news of this change caused a (warranted) unpleasant reaction from performance-based marketers. Many concluded that the proven and successful bid strategies over the years were getting the boot. Which meant that their bidding strategies would no longer function the same way. This, however, is not the case.
In the blog post released by Google detailing the new update, Google was sure to specify that there will be no impact to bidding behavior due to this change. Additionally, the campaigns currently utilizing a tCPA or a tROAS will continue to function in the same way. Which will automatically change over to the new bid strategy.
To simplify this change, Google states that no action is required as a result of this change.Although notes that it’s important to still be aware of it. Campaigns using the tCPA bid strategy will continue to bid to meet the cost per acquisition you set. Your tROAS bid strategy will still try and give you conversions at the highest possible return on ad spend.
Creating new campaigns focused on Google Ads bid strategy update
When creating new campaigns and/or changing your bid strategies, you will no longer see the option to choose the aforementioned bid strategies. Instead, you will be given the opportunity to choose from Maximize Conversions or Maximize Conversion Value. But here’s the catch:
- Maximize Conversions: This bid strategy will now feature the option to implement a target CPA–if you would like–and will have the same bidding behavior as the tCPA bid strategy.
- Maximize Conversion Value: This bid strategy will now feature the option to target a return on ad spend–if you would like–and will have the same bidding behavior as the tROAS bid strategy.
As you now know, tCPA and tROAS bid strategies are no longer options in the main bid strategy settings,. However, they will still be available as a subset of the Maximize Conversion and Maximize Conversion Value campaign bid settings. Which is why this change is important to know. It’s necessary to limit confusion, but it’s not significant in terms of changing the way you go about your campaign bidding strategy.
Although this bid strategy update seems to be daunting at first, it really doesn’t present us with many significant changes. Instead, it presents us with an opportunity to improve our campaign performance. On top that it offers insights into Google’s continual push toward more automation in its bidding strategies.
As PPC Hero’s Khushboo Aulakh puts it, “This approach is designed to help advertisers lower the risk of diminishing returns, as max conversions and max conversion value get more aggressive in driving revenue and lowering CPAs.”
The evolution of smart bidding allows PPC marketers the ability to compete. Even the little fish in a saturated market are able to more easily reach their performance goals.
The new and improved Maximize Conversions and Maximize Conversion Value campaign bid strategies are just additional steps in the Google Ads automation process. It was not the first stride towards automation, and it will most certainly not be the last.
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