navigating the maze of google bid adjustment v2

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Dr Wing Yee Lee | Senior Manager, Business AnalyticsNavigating the Maze of Google Bid Adjustment

© 2013 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

Show of Hands

2

www.papyrusonline.com

1. Enhanced Campaigns

2. Mobile

3. Google Recommended Bid Adjustment

4. Location

5. Time of Day

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Before and After

3

50p 80p 20pBefore:3 different bids

After:1 bidn multiplier

× (1+=

80p

20p

-75% )

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The Things People Say To you…

4

www.grist.org

You should raise your location bid adjustment on the keywords with high

conversion rates.

Increase bids when the user is within a certain radius of the store.

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Location Avg. Position Conversion Rate

A 1.2 34.37%

B 1.2 34.21%

C 1.3 31.22%

D 1.2 28.74%

You should raise your location bid adjustment on the keywords with high

conversion rates.

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1 1.5 2 2.5 3 3.50%

5%

10%

15%

20%

25%

30%

35%

40%

Regional Conversion Rate and Avg. Po-sition

Avg. Position

Con

vers

ion

Rate

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Increase bids when the user is within a certain radius of the store.

Do you have evidence to support this may work?

Can you track?

How to decide on the radius?

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Google Recommended Bid Adjustment

8

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Computer/Tablet ROI vs. Mobile ROI

9

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Bid Adjustment Calculation Method: RPC-based

Desktop / Tablet

Mobile Ratio

RPC £20 £10 2:1

Bid (Max CPC) £2 £1 2:1

Average CPC £1.8 £0.50 3.6:1

ROI £11.11 £20 0.6:1

10

Desktop / Tablet

Mobile Ratio

RPC £20 £10 2:1

Bid (Max CPC) £2 ? 2:1

Mobile Bid Adjustment = ?

Answer = -50%

£1

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Bid Adjustment Calculation Method: ROI-based

11

Desktop / Tablet

Mobile Ratio

RPC £20 £10 2:1

Bid (Max CPC) £2 £1.8 1.11:1

Average CPC £1.8 £0.9 2:1

ROI £11.11 £11.11 1:1

ROI Ratio = 0.6:1

Assuming the same bid-CPC ratio on mobile

Mobile Bid Adjustment = ?

Answer = -10%

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Beware of CPC Fluctuations

12

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RPC-based vs. ROI-based

Method Benefits Drawbacks

RPC-based More stable Does not account for Bid-to-CPC ratio between devices

ROI-based Closer to optimal

Regular re-calculations required to take into account of CPC fluctuations

13

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Use Weighted Ratios

Desktop/Tablet Mobile BidAdj.

RPC Clicks Revenue RPC Clicks Revenue

Keyword A

£1 100 £100 £1 100 £100 0%

Keyword B

£10 10 £100 £1 10 £10 -90%

Total £1.82

110 £200 £1 110 £110 -45%

14

Example credit to Kohki Yamaguchi

...

...

21

12

21

1

1

KwKw

KwletDesktopTabKw

MobileKwKw

letDesktopTabKw

MobileKw

ClicksClicks

ClicksRPCRPC

ClicksRPCRPC

entBidAdjustm

Mobile Bid Adjustment = ?

Answer = -8%

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Day of Week Bid Adjustment

15

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Time Bid Adjustment

16

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Time of Day Bid Adjustment

17

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A Convoluted Bid

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Say you want to make brownies…

400g caster sugar225g butter, melted60g cocoa powder1 tsp vanilla extract4 eggs225g plain flour½ tsp baking powder½ tsp salt60g walnut halves

450g

40g

5

Source: Pinterest – Stefanie Angus

Source: makemelaugh.com

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A Convoluted Bid

19

×(1+=

80p

20p

-75%

= 16p

-20%

= 24p

+50%)×(1+

)×(1+

)

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How to Navigate the Maze of Google Bid Adjustment

Taking advice with a pinch of salt

(including mine!)

Applying a few mathematical tools

Being aware of making convoluted bids

20

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