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CPA bidding concerns

| ‎04-04-2012 09:38 AM
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Hey, so I've been trying CPA bidding.  
I'm a little concerned though that one of my keywords that usually shows up in spot three has dropped since making the change.  


Thoughts? 

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Re: CPA bidding concerns

Reply to TatM
| ‎04-04-2012 09:50 AM

Hello TatM,

 

In starting of CPA bidding you can see drop down in CTR or ads position, or sometime you can higher cost per conversion but as camapign goes on CPA start giving better results. One of ther reason for this is Google take some time to analysis your past conversions data and then show your ads when they have maximum chances to get conversion.

 

For better result, do not make changes when you are using CPA and set Google suggested CPA bid for camapign. Kindly read Conversion Optimizer article for more information.

Dinesh
My Blog
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Re: CPA bidding concerns

Reply to DineshSEM
| ‎04-04-2012 12:20 PM
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Thanks for the tip.

Is there any idea how long I should wait to give the conversion optimizer a chance before going back?

Any chance of irrevocably hurting my campaign?
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Re: CPA bidding concerns

Reply to TatM
| ‎04-04-2012 05:54 PM
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Hello,

 

Wait for atlest 7 days and then compare how it works for your campaign. Please note CPA work better if your campaign is optimized in good way, means you should have high themed ad groups with 2-3 good ad texts, keywords have good QS and ctr. or other wise you can't get best result of conversion optimizer.

Dinesh
My Blog
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Re: CPA bidding concerns

Reply to DineshSEM
| ‎04-04-2012 06:12 PM
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Gah, it said its going to spend .59 cents per click on average and it's been spending like 90 cents!  

 

My clicks before were like 40 cents...

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Re: CPA bidding concerns

[ Edited ]
Reply to DineshSEM
| ‎04-04-2012 06:23 PM
Last edited 04-04-2012 06:25 PM by tomhalejr

Not to disagree with Dinesh, but even 7 days may be a little too quick to give the axe to CPA bidding. The more historical data the sytem has over time, the better it seems to get at increasing conversions, and reducing the cost per conversion. A couple more things you may want to take into consideration:

 

1. Try using "optimize for conversions" as your ad rotation settings. It may be the default setting for a CPA campaign now, but double-check in your campaign settings.

 

2. "Tightly themed adgroups" takes on a whole new meaning when you are talking about CPA bidding. Since your bids can only be set at the adgroup level, the closer the keywords are to each other in terms of average cost per conversion (within the adgroup), the more effective the software can be.

 If one keyword has an average CPA (cost per acquisition) of $100, and another KW in the adgroup has an average CPA of $10, the CPA bid of the adgroup could be too high or too low to be effective, given the vast differences in KW performance.

 

I really like CPA bidding, now more than ever. BUT, it is a different approach than max CPC bidding, and you have to use a slightly different strategy. If the position is too low for your goals, you could raise your max CPA to increase position. That does not mean you will absolutely pay more per conversion (than with CPC bidding), it just means you're telling the system it's OK if it has to spend a little more in the short term to get it's bearings. Then - if, when the conversions begin to increase, you can lower the max CPA, possibly maintain position, and increase conversions for less cost. The sytem needs some time, and some up's and down's, just to know what the max and the average CPA are over time.

Tom

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Re: CPA bidding concerns

Reply to tomhalejr
| ‎04-04-2012 06:26 PM
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Ahh, ok.  


So there's no chance of me hurting my long term performance?  

 

Also my ad groups are really big but I lose rank and quality score when I switch it to a new ad group! 

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Re: CPA bidding concerns

[ Edited ]
Reply to TatM
| ‎04-04-2012 07:15 PM
Last edited 04-04-2012 07:16 PM by tomhalejr

"Hurting" long term performance does depend on what you consider performance. :smileyhappy: If clicks, avg. CPC, avg. pos. etc. outside of conversion performance is your goal, then yes, optimizing for conversions may, to some degree, "hurt" those other performance factors. At least, in the very short term. I have seen some cases where CPA campaigns improve in more than just conversion stat. categories over time

 

If the reason why you are advertising using adwords to begin with is to improve the bottom line of the business, and conversions are the performance measurement of that goal, then all other factors are only relavent to your goals as they apply to increasing overall profitability. If a KW has a QS of 1, but generates 80% of your overall revenue, would you stop advertising on that keyword because it has a low QS? Sure, if you could improve that QS to 10, you would do even better, but the current situation is what it is, and you have a business to run. :smileyhappy:

 

"Also my ad groups are really big but I lose rank and quality score when I switch it to a new ad group!"

A couple of things here. First, even if you only use exact match keywords, you may see a temporary QS/rank decrease whenever you "migrate" a keyword. If that keyword (let's stick to exact only for the sake of simplicity) has a historical QS of say 7, if the KPI performance of the new adgroup/campaign is equivilent to previous performance, you should see the QS/adrank improve fairly quickly. Perhaps closer to a week than a month.

 

Though, I wouldn't let a temporary reduction in QS/adrank prevent me from maximizing the long term return on the most profitable (exact) keyword terms. If you improve more than you lost over the course of the month, and get more profitable conversions for less total cost at the end of the month, quarter, year, etc. then the longer you wait to optimize because of short term concerns, the less profit you will make in the long run.

 

I'll admit, I have never used CPA bidding for anything other than exact match keywords. The number of variables with broad/phrase match are just too great to get a real apples to apples comparison of CPC vs. CPA bidding. The non-converting underlying search terms are the issue. If you use the search terms report to find your highest converting exact match keywords, try using those keywords in a new campaign. Run it long enough to be eligible for CPA bidding, and then optimize that campaign for conversions. If you lose some QS/adrank, but dramatically increase conversions, you're making more money all around.

 

 Sorry to get on my soapbox here, but I do believe it's a little short sighted to focus on QS/adrank over conversions and overall profitability. QS will inevitably go up and down over time, if conversion performance, and profits steadily improve over the duration, it makes the frustrations of QS fluctuations much easier to cope with. If you doubled your sales over the course of a month, would your first reaction be - "Did my QS/ad rank for X number of broad/phrase match terms go up or down"?

Tom

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Re: CPA bidding concerns

Reply to tomhalejr
| ‎04-04-2012 07:32 PM
Really appreciate the help! I only care about conversions. I guess it's just working really well right now so I don't want to break it! And since switching to CPA it hasn't been amazing.

I'm a little bit worried we're going to get less calls though, because calls are conversions for us but they don't show up in conversion tracking.

We'll see I guess!
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Re: CPA bidding concerns

Reply to TatM
| ‎04-04-2012 08:54 PM

All I know is my cost per lead has really increased....

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